As the economic downturn eases, what challenges are management accountants in the public sector facing and what are employers looking for in their finance staff? By Neil Hodge, freelance journalist.
Following a general recruitment freeze, global demand for accountants in the government and academic sectors is now expected to increase, according to The International Federation of Accountants (IFAC). Experts say that organisations are looking for people with a mix of skills that can question organisational strategy rather than just examine the figures. Fortunately, the CIMA qualification promotes this style of thinking, say public sector finance directors.
Judith Briggs, head of financial management at Sherwood Forest Hospitals NHS Foundation Trust in the UK, believes that the CIMA qualification is probably the best suited of all the accounting qualifications to the needs of management and the wider organisation. ‘The selling point of the CIMA qualification is that it emphasises that accountants should understand the drivers that shape the organisation’s strategy, rather than just looking at income, expenditure and profit and loss. The idea that accountants should challenge management thinking is a strong point in their favour,’ she said.
Tony Whitfield, finance director at Salford Royal NHS Foundation Trust, said that the CIMA qualification is a good fit for NHS organisations because of the breadth of its training. ‘The NHS is constantly evolving and facing new challenges regarding budgeting, strategy and service delivery, and it needs accountants that are capable of looking at all the details of these issues and raising questions about them to management,’ said Whitfield.
False expectations
‘While NHS trusts need specialists to analyse all the financial information, they also need people with a broader range of general and softer skills who can look at the challenges more widely and engage with people throughout the organisation. In this way we can gain greater insight into the operational and strategic issues that determine how the money is being spent,’ he added.
Whitfield said that some accountants holding CIMA qualifications – particularly those who are newly qualified – may be considering the public sector as a place to work because private sector organisations are not recruiting as many people due to the recession.
‘People view the public sector as a safe haven and somehow believe that it is immune from economic downturns and recession. They also think that the public sector will settle for candidates that are second best because they can’t compete with private sector salaries to recruit the best candidates. This simply isn’t the case,’ said Whitfield.
‘Value for money is crucial in the public sector and HR departments are intent on getting the best people they can to do the job. The sector is facing some serious challenges in the year ahead and they are having to consider budget cuts, headcount cuts and getting rid of some services altogether to make ends meet. In that climate, they are not going to recruit a second rate candidate. They want the best they can get – people who are capable, flexible, and show initiative,’ he said.
Employer focus
So what exactly are employers in the public sector looking for?
Briggs said that the department has moved away from the ‘old style’ focus which was almost entirely on budgeting and expenditure. ‘It’s now about what the trust is doing to meet service provision expectations and understanding the reasons behind the levels of departmental spending and income so that we can get a better idea of how the trust is working. We are moving away from being financial accountants to being management accountants,’ she said.
The CIMA qualification and its emphasis on the wider strategic issues, rather than balance sheets and budget figures, is a perfect fit with the finance team’s aims at the trust.
Briggs said: ‘CIMA members are able to look more broadly at a range of strategic issues. And they tend to have better soft skills such as networking and being able to liaise directly with the board and other department heads. These skills have really caught management’s eye.
‘Ten years ago I was told that if you wanted to take a broader role in the organisation in the future, then opt for CIMA,’ said Briggs. ‘This has been entirely justified. CIMA managed to accurately predict how the needs of an organisation’s board would change so that it demanded more than just financial information from its finance department. Now, boards want information, opinions and assurance on a whole range of strategic issues from its finance team. We need to deliver it if we want to be regarded as truly valuable,’ she said.
Hard to recruit
Ruth Deedman, regional manager for finance and performance in the North East for the UK's Ministry of Justice’s National Offender Management Service (NOMS), said that the CIMA qualification is very well suited to the work that her department is doing. This is because ‘we are looking for people who have a broader set of skills and who can look at the financial aspects of a project as well as the strategic elements and the rationale behind it.
‘We find that financial accounting qualifications give people a very narrow view of the business while CIMA’s focus on management accounting encourages people to look at other aspects and this is a better fit for the work we are trying to do,’ said Deedman. ‘We want people to look at the business model and question the level and quality of service provision rather than just look at the financial accounting and we think that the CIMA qualification makes people better prepared for this,’ she added.
However, Deedman said that her organisation is finding it difficult to recruit CIMA members and disagreed that more people are looking at public sector roles now. ‘I suspect that the majority of newly qualified CIMA accountants are approaching private sector organisations, and probably for the usual two reasons – more money and a perception of better prospects,’ she said.
‘While public sector pay is a lot better than it has been, it can still find it hard to compete with private sector organisations purely in terms of remuneration,’ admitted Deedman. ‘However, with regards to prospects, I think the public sector offers as much opportunity as anywhere in the private sector, if not more in some cases. Public sector managers recognise the importance of recruiting candidates with a broad range of skills and that allows people to get involved in a wider variety of business areas. This presents more challenges,’ she concluded.