Almost every firm, government agency, and other type of organization has one or more financial managers. Financial managers oversee the preparation of financial reports, direct investment activities, and implement cash management strategies. Managers also develop strategies and implement the long-term goals of their organization.
The duties of financial managers vary with their specific titles, which include controller, treasurer or finance officer, credit manager, cash manager, risk and insurance manager, and manager of international banking. Controllers direct the preparation of financial reports, such as income statements, balance sheets, and analyses of future earnings or expenses, that summarize and forecast the organization's financial position. Controllers also are in charge of preparing special reports required by regulatory authorities. Often, controllers oversee the accounting, audit, and budget departments. Treasurers and finance officers direct the organization's budgets to meet its financial goals. They oversee the investment of funds, manage associated risks, supervise cash management activities, execute capital-raising strategies to support a firm's expansion, and deal with mergers and acquisitions. Credit managers oversee the firm's issuance of credit, establishing credit-rating criteria, determining credit ceilings, and monitoring the collections of past-due accounts.
Cash managers monitor and control the flow of cash receipts and disbursements to meet the business and investment needs of the firm. For example, cash flow projections are needed to determine whether loans must be obtained to meet cash requirements or whether surplus cash should be invested in interest-bearing instruments. Risk and insurance managers oversee programs to minimize risks and losses that might arise from financial transactions and business operations. They also manage the organization's insurance budget. Managers specializing in international finance develop financial and accounting systems for the banking transactions of multinational organizations.
Financial institutions—such as commercial banks, savings and loan associations, credit unions, and mortgage and finance companies—employ additional financial managers who oversee various functions, such as lending, trusts, mortgages, and investments, or programs, including sales, operations, or electronic financial services. These managers may solicit business, authorize loans, and direct the investment of funds, always adhering to Federal and State laws and regulations.
Branch managers of financial institutions administer and manage all of the functions of a branch office. Job duties may include hiring personnel, approving loans and lines of credit, establishing a rapport with the community to attract business, and assisting customers with account problems. Branch mangers also are becoming more oriented toward sales and marketing. As a result, it is important that they have substantial knowledge about all types of products that the bank sells. Financial managers who work for financial institutions must keep abreast of the rapidly growing array of financial services and products.
In addition to the preceding duties, all financial managers perform tasks unique to their organization or industry. For example, government financial managers must be experts on the government appropriations and budgeting processes, whereas health care financial managers must be knowledgeable about issues surrounding health care financing. Moreover, financial managers must be aware of special tax laws and regulations that affect their industry.
Financial managers play an increasingly important role in mergers and consolidations and in global expansion and related financing. These areas require extensive, specialized knowledge to reduce risks and maximize profit. Financial managers increasingly are hired on a temporary basis to advise senior managers on these and other matters. In fact, some small firms contract out all their accounting and financial functions to companies that provide such services.
The role of the financial manager, particularly in business, is changing in response to technological advances that have significantly reduced the amount of time it takes to produce financial reports. Financial managers now perform more data analysis and use it to offer senior managers ideas on how to maximize profits. They often work on teams, acting as business advisors to top management. Financial managers need to keep abreast of the latest computer technology to increase the efficiency of their firm's financial operations.
Work environment. Working in comfortable offices, often close to top managers and to departments that develop the financial data those managers need, financial managers typically have direct access to state-of-the-art computer systems and information services. They commonly work long hours, often up to 50 or 60 per week. Financial managers generally are required to attend meetings of financial and economic associations and may travel to visit subsidiary firms or to meet customers.
| 1. | Establish and maintain relationships with individual and business customers, and provide assistance with problems these customers may encounter. |
| 2. | Examine, evaluate, and process loan applications. |
| 3. | Plan, direct, and coordinate the activities of workers in branches, offices, or departments of such establishments as branch banks, brokerage firms, risk and insurance departments, or credit departments. |
| 4. | Oversee the flow of cash and financial instruments. |
| 5. | Recruit staff members, and oversee training programs. |
| 6. | Network within communities to find and attract new business. |
| 7. | Approve or reject, or coordinate the approval and rejection of, lines of credit and commercial, real estate, and personal loans. |
| 8. | Prepare financial and regulatory reports required by laws, regulations, and boards of directors. |
| 9. | Establish procedures for custody and control of assets, records, loan collateral, and securities, in order to ensure safekeeping. |
| 10. | Review collection reports to determine the status of collections and the amounts of outstanding balances. |
| 11. | Prepare operational and risk reports for management analysis. |
| 12. | Evaluate financial reporting systems, accounting and collection procedures, and investment activities, and make recommendations for changes to procedures, operating systems, budgets, and other financial control functions. |
| 13. | Plan, direct, and coordinate risk and insurance programs of establishments to control risks and losses. |
| 14. | Submit delinquent accounts to attorneys or outside agencies for collection. |
| 15. | Communicate with stockholders and other investors to provide information, and to raise capital. |
| 16. | Evaluate data pertaining to costs in order to plan budgets. |
| 17. | Analyze and classify risks and investments to determine their potential impacts on companies. |
| 18. | Review reports of securities transactions and price lists in order to analyze market conditions. |
| 19. | Develop and analyze information to assess the current and future financial status of firms. |
| 20. | Direct insurance negotiations, select insurance brokers and carriers, and place insurance. |
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