How To Become an Accounting Director

How To Become an Accounting Director

Accounting Director is a role that should be on any accounting manager’s career path. It is a senior leadership team member, and the incumbent has significant influence over the finance organisation in any company.

As in any leadership role, you need both hard and soft skills, as well as relevant experience. Most importantly, you need accounting certifications.

Photo by Carlos Muza on Unsplash

This article provides accountants with an overview of the role’s responsibilities. It explains how to become an accounting director, the average salary for the role, and essential tips for success.

What Does an Accounting Director Do?

The Accounting Director role is senior. It covers responsibility for financial operations and planning. It also involves helping the FD and CFO develop strategies.

Accounting directors usually coordinate audits. They manage both external and internal ones. They also have key business relationships with external stakeholders. These include banks, financial institutions, government agencies, and tax consultants.

They manage a team that covers all financial aspects. These include ledger accounting, cost accounting, accounts receivable, and financial accounting. They rely on accounting managers to run the accounting or financial departments.

Types of Accounting Directors

The breadth and scope of an accounting director’s role depend on the type of organisation in which the position sits.

• In large and diverse organisations. That’s for financial controllers. An accounting director would likely cover duties like those of a group financial controller. These tasks include making board financial reports and documents. They also include preparing the annual financial statements. They work with external auditors. They guide the organisation through changes in IFRS or GAAP.
• In smaller organisations. An accounting director would typically assume a more senior role, akin to a mini-CFO. They would develop financial strategies and control asset management and resource deployment. They would also look after accounting systems and software. Tax and tax management are also strictly linked to accounting directors. Although it may be part of a separate department looked after by a tax accountant, the tax would naturally report to an accounting director. There isn’t a “one-size-fits-all” accounting director. Still, the key thing is that an accounting director is ultimately accountable for their actions. They are accountable for an organisation’s financial data and financial reports.

Photo by Kaleidico on Unsplash

Developing Financial Strategies: Duties and Responsibilities of an Accounting Director

Besides operational goals, the accounting director also helps create financial strategies. The specifics depend on the company’s size.

Such strategies usually relate to asset allocation and resource management. For instance, how do you manage a debt covenant in a company with external leverage? Also, how to allocate equity or debt to maximise return. And, how to invest capital for business expansion while keeping a manageable debt-to-equity ratio.

Developing financial strategies includes forecasting and budget management. An accounting director typically coordinates these tasks and presents them to the board for approval.

Data-driven decisions are now more important. The company must make the most of its financial data. An accounting director oversees accounting systems and software. Their responsibility will be to assess the suitability of the current ERP system. They may also develop a strategy and plan for an upgrade or replacement.

Photo by Volkan Olmez on Unsplash

Skills of an Accounting Director

An Accounting Director position is one of the senior management positions, and as such, a candidate would need the right mix of soft and hard skills.

• Knowledgeable in management and leadership. Accounting directors may rely on accounting managers in large organisations. They may be directly responsible for financial departments in smaller organisations. But in either case, they need leadership skills. These skills are essential for them to operate well. As part of the senior leadership team, it is expected that individuals will be able to manage a team and have experience with human resources. To progress in the role, they should do this effectively.
• Communication. All leadership positions need such skills. Yet, this is key for accounting directors. Their roles require interpreting financial information. An accounting director must do more than report transactions or present income statements. They must interpret the data and share it with the organisation.
• Analytical Skills: Problem-solving and Attention to Detail. Accounting directors should have superior analytical skills. They need to analyse financial information and accounting data. They must draw meaningful conclusions. There is an element of reliance on accounting managers and financial analysts. Still, the CFO and FD will look at accounting directors for solutions and analysis. As the second CFO or FD, they will need to provide solutions to tough problems. This could involve advising on the impact of new financial regulations and tax forms, or assisting with strategic planning.
• Organisation and planning. Accounting directors also have operational objectives related to the company’s accounting management. As such, they must be able to prioritise and focus on critical tasks. They would have to periodically juggle tax data. They would also need to handle statutory account filings and prepare financial statements. Thus, organisational and time management skills are essential.
• Financial Expertise. An accounting director in any company is the resident expert in financial matters. As such, they should be familiar with all financial concepts and regulations. They should also be familiar with the accepted accounting principles. More broadly, they need to interpret financial data. They will handle expense management, treasury management, and budgeting. They will be the top financial advisors, except for the CFO. As such, they must be sound financially and knowledgeable.
• Risk Management. The accounting director is also the custodian of the risk management register. While they don’t need to be experts in all types of risks, they do need to efficiently and effectively work with the entire organisation. This is to gather, assess, and present the risks to the board. The accounting director is the last line of defence in risk management. They ensure a company meets its objectives without taking on unnecessary risks.
• Accounting software skills. Accounting directors are the custodians of financial data. Such data is inevitably stored on ERP systems, so a certain level of skill in accounting software packages is required. So, accounting directors (and accounting managers) usually help with design. They also set up financial software. They will also ensure that the ERP is compliant with the new accounting regulations. This will make the ERP produce accurate financial information. Knowing accounting software will also help. It will improve procedures and expedite the creation of accounting statements.

Unsplash+In collaboration with Getty Images

How to Become an Accounting Director

• Earn a graduate degree. A bachelor’s degree is required for accounting professionals seeking to pursue this career path. You do not need a finance or accounting graduate degree. Having both an accounting certification and a degree in a different field, such as engineering, can be beneficial. This is especially true in a relevant industry, such as manufacturing. Yet, you need to pursue accounting qualifications in this career path. A bachelor’s degree in a finance-related subject helps make the path easier. Similarly, accounting director jobs do not require a master’s degree. However, having one helps candidates stand out and increases the chances of a high salary.
• Earn an accounting certification. As an accounting expert, it’s not a written rule. But today’s business expects an accounting director to have an accounting qualification. As outlined in our article here, there are various qualifications. They are all suitable for accounting directors. It could be a Certified Public Accountant, Certified Financial Analyst, or Certified Auditor. All accounting qualifications are relevant for professionals who want to become accounting directors. It usually takes two or three years to complete such qualifications. Appropriate professional experience is also needed to support them.
• Get work experience in your field.  Accounting directors possess transferable skills due to the nature of their role. As mentioned before, academic qualifications are key. These include bachelor’s degrees and accounting certifications. But relevant work experience is also key. A young professional would naturally progress to an accounting director position by moving up the ranks. They might start as a cost accountant or a certified management accountant. Then they become an accounting manager. An accounting manager will have gained accounting credentials. They cover all parts of financial management: AP, AR, GL, management accounting, tax, and banking. With increased exposure, they would be better equipped to take on stakeholder management. They would also be ready to take on operational procedures and set up as an accounting director. In small or large organisations, public or private, it is possible to gain work experience. The size of the company does not determine whether an accounting manager can become an accounting director. What matters more is the breadth and depth of exposure. However, as a differentiator, experience in professional services (such as auditing) or with publicly listed companies can significantly enhance a CV.

Photo by Sean Pollock on Unsplash

What Is the Career Path to Becoming the Accounting Director of a Company?

There are only a few significant career paths to becoming an accounting director. Yet, it is certain that the person would have spent at least 3-5 years in a finance department, covering various vital roles.

It is nearly impossible to fill accounting director positions. You need experience in finance. Yet, the road to the top can take many turns.

Usually, the top candidates for accounting director jobs are accounting managers. They have handled many functions in the accounts department and likely started as AP, AR, or management accountants.

A background in tax or treasury makes a person a strong candidate for an accounting director position. The same applies to a career in professional services, such as public practice or audit.

The key message here is that so long as you have developed a career in finance, you can generally aim for the Accounting Director’s position.

Best Tips for Looking for an Accounting Director Job

To secure an accounting director position, a candidate must ensure that their CV is up-to-date and accurately reflects their relevant experience.

There is no substitute for experience and accounting qualifications. Hence, there is no shortcut “to the top.”.

Yet, new finance professionals can prepare to be accounting directors. They have just started or are halfway through their careers. They can do this by gaining broader experience in areas not covered in their CVs.

For example, areas such as Treasury and tax may not necessarily be topics that candidates are fully exposed to if they are working in finance. Also, public companies usually handle tax and Treasury matters centrally. So, if the aim is to become an accounting director, candidates can take steps by moving “sideways” in large organisations. They can also switch roles within finance to maximise their exposure.

Accounting Director’s Role as a Stepping Stone

It’s also important to acknowledge this. The role of accounting director doesn’t need to be the end for ambitious finance professionals. There is a long road ahead, one that encompasses the roles of the Group Financial Controller, CFO, or FD. All these are positions that an accounting director can handle, given the right career choice and exposure.

The accounting director’s position is common in large, publicly listed organisations. It easily coexists with the CFO and FD roles.

To learn more about a career in accounting, please visit our resources page or search for accounting job roles.