What is a finance manager and what do they do?

The finance manager role varies considerably depending on the organisation that they work for. In smaller companies (without a financial controller or chief financial officer) the finance managers can act as the head of finance and be the principle creator of budgets, accounts and payroll. In larger organisations, the finance manager may be a senior finance professional with accountability for a specific area of the business or team who reports directly to senior leadership.

Accordingly, finance managers can have a diverse range of responsibilities across all areas of financial operations. They may be involved in budgeting and forecasting, preparing management accounts, compliance, managing cash flow or even contribute to internal audit processes. They may also be involved with more strategic elements such as cost and risk reduction, finance system reviews and implementation or be asked to support other commercial projects.

Wherever they are, finance managers usually assist senior management in making financial decisions that affect the organisation by preparing analysis and reports to facilitate informed decision making. A strong finance manager will ensure management are appraised of financial trends and kept up-to-date with new developments within the market as they will be expected to provide insight that will help develop strategies and plans for both short and long-term financial goals.

Key responsibilities

Responsibilities will vary, but examples include:

  • Monitoring ongoing financial operations within a company, such as payroll, invoicing, cash flow and other transactions
  • Formulating strategic and long-term business plans
  • Overseeing employees within the finance department, including accountants
  • Researching and reporting on factors influencing business performance and identifying areas for potential improvement
  • Identifying cost reduction opportunities
  • Ascertaining methods for minimising financial risk to the company
  • Liaising with auditors to ensure annual monitoring is carried out
  • Developing external relationships with appropriate contacts, e.g. auditors, solicitors, bankers and statutory organisations such as the Inland Revenue
  • Managing budgets and producing accurate financial reports to specific deadlines
  • Ensuring compliance with applicable laws and procedures
  • Contracting outside services for tax, auditing, banking, investments, and other financial services
  • Providing insightful information to senior management to aid long-term and short-term decision making
  • Presenting financial reports to board members, stakeholders, executives, and clients
  • Keeping up to date with technological advances and accounting software

Why are they important?

As well as playing an important management role in an organisation, finance managers also contribute to a company’s success by providing reporting and analysis that helps inform senior management. Their insight and analysis are often used to support strategic decision making and assist senior management to assess and prioritise strategic projects and opportunities.

Skills needed for this role

A finance manager needs to be able to deal with complex modelling and analysis, as well having a sound understanding of financial systems and procedures. Excellent attention to detail and strong interpersonal, communication and problem-solving skills are essential. Commercial and business awareness is highly beneficial, as are good organisational, planning and research skills.

Strategic Professional Options examinations linked to this role

Advanced Financial Management

Advanced Performance Management

Career opportunities presented by this role

Finance Managers work in a variety of industries including the banking and finance, healthcare and insurance industries, as well as private companies and government agencies. The skills of a Finance Manager are very transferable and experienced professionals will move on to the role of Finance Director or Managing Director. Some proceed to train in professional accountancy or move out of finance and into a more general management role, such as HR manager. Financial management also offers good opportunities to work overseas.

Competencies

High level competencies required include:

  • Corporate and business reporting

    A. Prepares financial statements, corporate financial and integrated reports for external stakeholders using appropriate technology.

    B. Leads effective decision making through analysing, evaluating and communicating performance and position of entities.

    C. Prepares financial statements for groups of entities using appropriate technologies.

    D. Monitors, critically evaluates, and advises on the relevant accounting standards, regulations, conceptual and financial reporting frameworks.

     

  • Financial management

    A. Links developments in global trade, markets, business practices and the economic environment to required improvements in the financial and risk management of an organisation.

    B. Advises on business asset valuations, capital projects and investments using appropriate analytical qualitative and quantitative techniques.

    C. Identifies, evaluates and advises on alternative sources of business finance and different ways of raising finance.

    D. Communicates and advises on the impact on financial decision making on current developments in regulation, governance and ethics.

    E. Assesses and advises on appropriate strategies to manage business and organisational performance regarding business and finance risk and effectively communicates the impact.

     

  • Governance, risk and control

    A. Evaluates organisational structures and governance to protect the long-term interests of stakeholders.

    B. Recommends appropriate strategies to ensure adherence to governance structures and application of best practice internal controls.

    C. Identifies and manages risk appropriately.

    D. Uses risk management for the best interests of an organisation and its stakeholders.

    E. Monitors and applies relevant legislation, policies and procedures.

  • Leadership and management

    A. Applies appropriate leadership strategies to effectively deliver business objectives.

    B. Leads, motivates and manages people to optimise performance and effectiveness.

    C. Collaborates, supports and works to achieve the objectives of the organisation, applying appropriate digital technologies.

    D. Acts proactively and thinks strategically, in anticipating organisational needs, recognising the wider business environment and dynamics.

     

  • Management accounting

    A. Applies development and performance management, in the wider business and technological environment, within the context of strategic planning and implementation.

    B. Directs organisational performance through the selection and measurement of financial and non-financial performance indicators.

    C. Collaborates on the key tactical and organisational areas of budgeting and control, capital investments, people and resource management.

    D. Consults on the design and use of current and emerging technology and information systems to improve strategic decision-making and organisational performance.

  • Strategy and innovation

    A. Applies business acumen and commercial awareness to deliver business objectives.

    B. Recommends a range of suitable strategic options from which to develop sustainable plans and objectives.

    C. Evaluates, justifies and implements suitable strategic options.

    D. Adopts and applies innovative methods to implement strategy and manages change.