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Accountants as Communicators

It has been said that accountants speak a language of their own. As a result, financial teams can use acronyms and other “short hand” to quickly and effectively communicate information. However, accountants are spending more and more time communicating with their non-finance counter-parts. This can result in the accounting team appearing difficult to understand. For finance professionals who communicate and work with varying parts of the organization, it is critical to focus on these three key essential communications considerations:

Need: Effective financial communication starts with knowing what your audience needs. Whether you are developing a report or delivering a presentation, it is important to zero in on what your colleagues need to know to better understand an issue or take necessary action. Resist the temptation to share everything you know –focus on what they need to know.

Language: Financial communication does not have to only be about finance. If you are communicating with the marketing team, find a way to tie the information into their work. For example, the marketing team might not understand capital expenditures or amortization; they do understand that it takes progressive investments to penetrate a market. By using their language and terms, you can also help them to better understand financial information.

Relevance: Accountants, because of their skills in relating unrelated data and figures together, can see the whole story from only a few pieces of information. As a result, accounts sometimes assume that others in the organization can do the same. To be the best financial communicator possible, be sure that you not only provide information but explain the relationship between key data points. By explaining the relevance and interdependencies between facts and figures financial communicators can help enhance understanding as well as share information.

Focusing on communication does take time and effort. But for the finance professional who wants to be seen as a valued resource to their colleagues and management, it’s a necessity.

Accountants as Communicators

Accounting for Credit Losses

The Financial Accounting Standards Board (FASB) issued an Accounting Standards Update (ASU) that improves financial reporting by requiring timelier recording of credit losses on loans and other financial instruments.

The ASU requires an organization to measure all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. Financial institutions and other organizations will now use forward-looking information to better inform their credit loss estimates.

Many of the loss estimation techniques applied today will still be permitted, although the inputs to those techniques will change to reflect the full amount of expected credit losses. Organizations will continue to use judgment to determine which loss estimation method is appropriate for their circumstances.

The ASU requires enhanced disclosures to help investors and other financial statement users better understand significant estimates and judgments used in estimating credit losses, as well as the credit quality and underwriting standards of an organization’s portfolio. These disclosures include qualitative and quantitative requirements that provide additional information about the amounts recorded in the financial statements.

Additionally, the ASU amends the accounting for credit losses on available-for-sale debt securities and purchased financial assets with credit deterioration.

The ASU on credit losses will take effect for U.S. Securities and Exchange Commission (SEC) filers for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019.

For public companies that are not SEC filers, the ASU on credit losses will take effect for fiscal years beginning after December 15, 2020, and interim periods within those fiscal years.

For all other organizations, the ASU on credit losses will take effect for fiscal years beginning after December 15, 2020, and for interim periods within fiscal years beginning after December 15, 2021.

Accounting for Credit Losses

Accounting Supervisor Key Qualities

In most organizations accountants work in teams, often segmented by key functions or areas of specialization. While all accountants share a passion for accuracy, efficiency, and process – not all accountants make good supervisors.

At SNI Companies we have placed Accounting Supervisors in a wide variety of industries, and most agree that making the change from staff accountant to supervisor requires building and showcasing these key attributes:

People Skills

Serving as an Accounting Supervisor is more about people than it is about accounting. Knowing how to motivate them, listen to them, and communicate with them is essential. Your success depends on the success of your team and the ability to work effectively with them. Sometimes this means helping them improve their performance by removing barriers to their success, coaching to enhance skills, or holding them accountable when they don’t perform.

Listening Skills

Accounting Supervision involves a good deal of listening. You need to accurately listen to your internal clients, the CFO, business unit leaders, and really anyone else who needs services or reports from your team. It also means developing the skill of listening to both what is said and what is implied. This means listening for tone and other indicators which provide insights to someone’s perceptions and satisfaction.

Communication Skills

Good communication skills are essential to an accounting supervisor. You must be able to present complex financial information in a way that their team and their non-financial colleagues understand. You also have to make communicating with your team a priority to ensure that you share information, expectations, and knowledge which supports optimal success.

If you are an accountant who enjoys working with teams, are a skilled listener, and have solid communication skills - accounting supervision might be the right step for you.

Accounting Supervisor Key Qualities

The State of Business Analytics

Business analytics study data through statistical and operations analysis, the formation of predictive models, and the application of optimization techniques. Business analytics also involve the communication of insights and data to customers and colleagues. Most technology and business leaders agree that data driven decision-making is optimal, but few organizations have automated and embraced business analytics technology.

A Bloomberg Businessweek Research Services study, conducted among 930 businesses across the globe in various industries, provides six insights into the state of business analytics:

1)Business analytics is still in the “emerging stage” with most businesses utilizing Excel spreadsheets vs. analytics software.

2)Organizations are proceeding cautiously in their adoption of analytics. Use of business analytics has only grown at a moderate rate and their use is narrow within different aspects of an organization.

3)Intuition based on business experience is still the driving factor in decision-making. Analytics are used as part of the decision process at varying levels, depending on the organization.

4)Companies are looking to analytics to solve big issues: with the primary focus on money, reducing costs, improving the bottom line, and managing risks.

5)Data is the number-one challenge in the adoption or use of business analytics. Companies continue to struggle with data accuracy, consistency, and access.

6)Many organizations lack the proper analytical talent. Businesses that struggle with making good use of analytics often don’t know how to apply the results.

Despite these barriers, organizations with investments in quantitative methods and evidence-based data in business modeling and decision-making have seen dramatic and positive results. If your organization is not embracing business analytics, now may be the time to investigate how to minimize barriers to adapting a more data driven approach.

The State of Business Analytics