I am potentially looking for a field switch from Financial to cost/managerial accounting as it seems there are more opportunities in cost than financial (side bonus starting salaries seem to be higher too). All my experience is in the financial side of accounting though, and I do not want to set myself up for failure. Can anyone who is in/has experience in cost accounting describe the daily/weekly/monthly tasks that were performed or expected? For example on the financial side i would say almost 95% is software based and pretty straight forward. You wont be doing actual journal entries, depreciation, etc...its mostly accounting software that will ask you to input certain information in key spots and it will do everything for you, so all you really need to know are the most basic of rules day to day, and next to none of the financial formulas are ever used. Hope that makes sense! Not looking for a job description, we've all seen those and companies do not usually accurately describe the operations that would be performed. I'm looking for specific reports, formulas used, procedures, rules that apply that if I get a chance at cost it will be expected I know how to do without any training what so ever. Sorry for the length of this question, and i greatly appreciate any help.
Cost Accounting
Answers
Don't overlook the fundamental issue when it comes to your professional competency and efficiency to perform in a particular job. If the daily activities and the environment you have to perform are not in line with your personality and the way you like to do things, the new job will make you unhappy. And if your daily work becomes nothing more than a paying job, you will not be able to be successful.
If you feel comfortable working in a typical clean white-collar office and/or banking environment, where adherence to accounting and legal rules and regulations, on an ongoing basis, you will not be happy in a cost accounting job.
As a general rule, Financial Accountants are Balance Sheet oriented. Safeguarding the assets of a company, identifying existing and potential Liabilities are their domain. Cost Accountants are more focused on the Profit and Loss Statement, and their work involves breaking down the income and expenses into categories that allow identifying the productivity and the profitability of an organization.
Consequently, competent Cost Accountants must understand the processes, and be able to identify the impact management decisions had and will have on the results achieved during a reporting period. It is a much more “hands-on” job, sleeves up, and collection of information from the shop floor, and the warehousing and shipping departments.
And of course, it all depends on the proficiency level of your job assignment. If it comes to data input and use of computerized standard templates prepared by the Cost Managers, this difference becomes much less important. But the higher a cost accountant progresses in his career, the more involved he/she gets in the daily communication and teamwork with Operating and Marketing Managers. And his ability to understand the processes and to apply analytical thinking to continuously adapt the costing methods used to the changing factory and supply chain processes, the more successful he/she will be.
For further information on this topic, google KPI’s, Standard Costing, ABC, Value-Based Management.
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It was a very concise and clear reply to the query. I think that was a pretty common question he asked.
Thank you for your crystal clear response. I think you explained very well