What Is Management Accounting? Jobs, Skills, Salary, Education

Management accounting is the process of analyzing and interpreting data to make informed decisions about the business operations of an organization. Someone who works in management accounting will likely conduct:

• Internal audits

• Monitor spending and costs

• Identify financial trends

• Predict future needs

The goal of management accounting is to aid decision-makers by providing accurate information about a business’s financial operations. 

Management accounting vs. financial accounting 

The major difference between the two accounting types is that management accounting focuses on strategic decision-making within a company, while financial accounting provides analysis for external use. 

Management accountant job titles

Your job title in management accounting varies based on a few factors, including:

• Size of an organization

• Level of experience

• Type of industry

• Required credentials for reporting financial information 

Roles, responsibilities, and job titles may vary widely in this field. A few common job titles in management accounting include the following: 

• Controllers act as the manager of the financial department and will likely report to a supervisor like an accounting manager. Their job is to gather financial data and prepare documents per the needs of the end user. 

• Financial analysts or accounting analysts mostly focus on analyzing key financial documents and creating reports and presentations for decision-makers in an organization. They may note trends, offer financial advice, and determine a company’s value. 

• The chief operating officer (COO) is likely the lead decision-maker over a company’s financial choices. They use financial reports that management accountants compile. In an executive position, the CFO is the one to execute financial strategies and develop plans based on financial status.  

• Accounting managers conduct financial processes like monitoring cash flow, conducting company-wide audits, and budgeting. Account managers oversee a financial department and report to the company's executives and decision-makers.  

Read more: Your Guide to Managerial Accounting: Types, Careers, and More

Management accountant responsibilities

A management accountant’s responsibilities are central to analyzing and interpreting a company’s financial information. Since a management accountant may work in various industries, the responsibilities may vary, but some common tasks include: 

• Perform cash flow analysis to help make decisions that involve company purchases 

• Determine price points for goods and services 

• Plan out the total costs of goods and services

• Monitor performance metrics (e.g., debt to equity ratios)

• Calculate inventory turnaround 

• Manage deficient accounts receivable 

• Use performance reports to note changes in budget or to set budgets 

• Evaluate the financial performance of a company 

• Prepare financial budgets for a company 

• Suggest financial investments such as stocks and bonds or other investments 

• Monitor sales, costs, and spending 

• Conduct internal audits 

• Supervise staff within a financial department 

• Handle tax returns 

How much do management accountants make? 

The salary ranges for management accountants will vary by factors like job title, industry, location, level of education, certification, and years of experience. According to Glassdoor, the estimated total pay for management accountants in the US is $111,514 per year. This figure includes an average base salary of $90,606 and $20,908 in additional pay. Additional pay may represent profit-sharing, commissions, or bonuses.

*Note: US salary information is taken from Glassdoor and is accurate as of February 2023.

What skills do management accountants require?

Management accountant jobs require financial and business skills, so it’s essential to demonstrate proficiency in both. You will work with the financial dealings of a company and in day-to-day operations. As a result, you’ll be best equipped in this field if you have the ability to be analytical and realistic in aligning decisions with a company’s goals and future plans.  Here are some competencies to have to be successful in management accounting:

• Excellent analytical and numerical abilities: As a management accountant, you will spend most of your time making sense of financial documents and translating that data into easy-to-understand reports. Management accountants do this through data analysis tools like Excel spreadsheets. 

• Accuracy and an eye for detail: It’s important to have an eye for detail to find discrepancies and errors and to spot patterns and trends you can use when creating budgets and forecasting. 

• Have business knowledge: Understanding the industry and how your company functions in that space can help you to better understand the financial status of your company and devise strategic plans. 

• Good oral and written communication skills: From oral presentations to written reports, a large portion of your work in management accounting will be translating complex financial processes, reports, and statements, into content that’s easily digestible. 

Is management accounting right for you?

Management accounting may be right for you if you enjoy working with data, numbers, and finances. Management accounting can be a rewarding and exciting career, especially with evolving technologies that make data analysis and collection even more precise. Consider the following things to determine whether this field is for you: 

• You want to do something that requires analytical skills. If you have the patience and attentiveness necessary to study data for patterns or trends, this might be a career for you. Data analysis requires examining the details and from your findings, interpreting results for the purpose of presentation. 

• You are interested in working in management. In this field, multiple managerial positions are available, making it a great field to work in if management is in your future career goals. 

• You're good with numbers. Management accounting is a subsection of accounting, so you will need to be very comfortable with numbers and proficient in basic skills. 

• You feel passionate about accounting. Beyond proficiency in mathematical and analytical skills, if you enjoy the challenge of balancing books, setting budgets, and problem-solving, this field might be for you. Accounting requires critical thinking and deductive reasoning.

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Steps to becoming a management accountant

To become a management accountant, earn a degree in accounting, gain professional experience, and consider Certified Management Accounting (CMA) certification. Here are six steps to get started in management accounting. 

1. Consider a degree in accounting.

Earning a bachelor’s degree in accounting, finance, business management, or a related field is your first step in becoming a management accountant. Some individuals may pursue an associate degree in management accounting; however, you will need a bachelor’s degree to pursue certification. Many employers prefer a graduate degree since this is a management position within a company, so be prepared to pursue your master's in management accounting if necessary. 

2. Gain professional experience. 

After obtaining a degree, build your skills while gaining experience to prepare yourself for future employment or certification. You may also want to pursue advanced degrees. Professional experience will be required for management roles. Some management accountants advance from entry or mid-level positions like auditing clerk, bookkeeper, or assistant controller. 

3. Apply for Institute of Management Accountants (IMA) membership.

If you want to pursue certification to become a certified management accountant, you have to be a member of the IMA. The IMA membership allows you to access its resources and apply for certification. To stay certified, you’ll have to pay an annual membership fee and complete ongoing continuing education requirements. 

4. Enroll in the Certified Management Accountant (CMA) program.

Requirements to enroll in the CMA program include membership to the IMA, payment of a program fee, a bachelor’s degree from an accredited university, and at least two years of consecutive professional experience. Once enrolled, you have up to one year to study and prepare for the CMA program. 

5. Pass the CMA exam.

The two-part CMA exam will test your knowledge of financial planning, performance, and analytics, as well as strategic financial management. The test can be taken in person at an approved test site or remotely. The IMA offers several testing windows per year. There is a separate exam fee. 

Exam consists of: 100 multiple choice questions and two essay questions 

6. Getting started in the field.

When you’ve met the educational and experiential requirements to get into management accounting, it’s an ideal time to network and continue building relevant skills. Be prepared to start in an entry-level position in a finance department within an organization. Focus on gaining real experience in this role and finding opportunities to hone your skills to advance in management accounting. 

Get started 

Management accounting can be a fast-paced and rewarding career choice. Get started in your career by enrolling in an accredited program and building your skills with online courses. Consider the Managerial Accounting Fundamentals course offered by University of Virginia. It covers topics in managerial accounting, cost volume analysis, cost allocation, and more.