Accounting, Financial, Taxation

Job descriptions for these 12 key positions are essential and crucial to determining who is responsible for each task in accounting and financial department. Otherwise there is no way to control the flow of activities or know who should be contacted about fixing problems. The typical accounting and finance departmental structure typically includes one or more assistant controllers reporting to the controller, each of whom is responsible for a selected set of functional areas, such as accounts payable and accounts receivable, or cost accounting and the general ledger. Below these personnel are a number of accountants and clerks. Within these reporting relationships, it is necessary to define the exact job description of each position, which should be included in the general accounting manual.

Of course, job description sets should be depends on the accounting and department’s goal set by the company’s management (in the whole) which most likely adapted with the nature and dynamical of the company’s operations. But, in general, here are examples of job descriptions that should be included:

[1]. Controller

Reports to: Chief Financial Officer

Responsibilities                                                                 -Timing

Accounting Area

Assist in the annual audit as required                                                   -Annual
Develop accounting policies and procedures                                        -Ongoing
Ensure that accounts payable are paid on time                                     -Daily
Ensure that accounts receivable are collected promptly                       -Daily
Ensure that all economical payable discounts are taken                       -Daily
Ensure that billings are issued promptly                                               -Daily
Ensure that job costs are calculated                                                      -Ongoing
Ensure that bank reconciliations are completed                                    -Monthly
Issue financial statements                                                                     -Monthly
Maintain an orderly accounting filing system                                        -Ongoing
Maintain the chart of accounts                                                              -Ongoing
Manage outsourced functions                                                               -Ongoing
Manage the accounting staff                                                                 -Ongoing
Manage the budgeting process                                                             -Annual
Prepare the annual budget                                                                    -Annual
Process payroll in a timely manner                                                       -Bi-weekly
Provide financial analyses as needed                                                    -Ongoing
Review systems for control weaknesses                                               -Ongoing

Finance Area

Arrange for banking services                                                                -Ongoing
Arrange for debt financing                                                                    -Ongoing
Conduct public offerings                                                                      -As needed
Invest excess cash                                                                                -Daily
Invest pension funds                                                                            -Monthly
Issue credit to customers                                                                     -As needed
Maintain insurance coverage                                                                -Annual
Maintain lender relations                                                                     -Ongoing
Manage the finance staff                                                                      -Daily
Monitor cash balances                                                                         -Daily

[2]. Assistant Controller, Transactions

Reports to: Controller

Responsibilities                                                                           -Timing

Manage the accounts payable process                                                -Ongoing
Manage the accounts receivable process                                             -Ongoing
Manage the payroll process                                                                  -Ongoing
Use best practices to increase transactional efficiency                        -Ongoing
Take all viable supplier discounts                                                        -Weekly
Ensure that payments are authorized and accompanying                     -Daily
deliveries are received prior to payment

Issue invoices to customers in a timely manner                                   -Daily
Obtain payment from customers in a timely manner                            -Daily
Create an efficient time keeping system                                               -Ongoing
Issue payments to employees in a timely manner                                 -Bi-weekly
Make payroll tax payments in a timely manner                                     -Monthly

[3]. Assistant Controller, Financial Reporting

Reports to: Controller

Responsibilities                                                                            -Timing

Create financial statements                                                                 -Monthly
Create footnotes to financial statements                                             -Monthly
Create SEC reports                                                                                -Quarterly
Monitor changes in generally accepted accounting principles             -Ongoing
Present financial results to the management team                               -Monthly
Create systems for efficient reporting process                                     -Ongoing
Create the annual budget                                                                      -Annual
Create internal management reports                                                     -Ongoing

[4]. Assistant Controller, Cost and Tax Accounting

Reports to: Controller

Responsibilities                                                                              -Timing

Manage the cost and taxation staff                                                       -Ongoing
Devise tax strategies                                                                             -Ongoing
Create tax data collection systems                                                       -As needed
Complete required tax forms in a timely manner                                  -As needed
Update the company sales tax database as tax rates change                -As needed
Negotiate with tax authorities over tax payment issues                       -As needed
Review adequacy of costing systems                                                    -Quarterly
Report on costing variances                                                                  -Monthly
Report on overhead allocation variances                                               -Monthly
Report on margins and break-even points                                            -Monthly
Report on capital budgeting requests                                                    -Ongoing
Assist in development of the budget                                                     -Annual
Analyze new product margins                                                                -Ongoing

[5]. Accounts Payable Clerk

Reports to: Assistant Controller, Transactions

Responsibilities                                                                               -Timing
Match supplier invoices to purchase orders and receiving documents   -Daily
Take all viable supplier discounts                                                          -Daily
Obtain approvals for supplier invoices                                                   -Daily
Pay supplier invoices when due                                                              -Weekly
Research supplier requests for payment                                                 -As needed

[6]. Billings Clerk

Reports to: Assistant Controller, Transactions

Responsibilities                                                                              -Timing

Issue invoices to customers                                                                  -Daily
Contact customers about overdue invoices                                           -Daily
Issue monthly customer statements                                                     -Monthly
Resolve billing discrepancies with customers                                       -As needed
Process cash receipts                                                                            -Daily
Recommend bad debt write-offs                                                           -As needed

[7]. Payroll Clerk

Reports to: Assistant Controller, Transactions

Responsibilities                                                                                   -Timing

Collect time cards from employees                                                      -Weekly
Obtain supervisory approval of time card discrepancies                      -Weekly
Obtain overtime approvals                                                                   -Weekly
Process garnishment requests                                                             -As needed
Process employee advances and paybacks                                          -As needed
Print and issue paychecks                                                                   -Bi-weekly
Issue direct deposit tapes to the bank                                                -Bi-weekly
Deposit payroll taxes                                                                          -Monthly

[8]. General Ledger Accountant

Reports to: Assistant Controller, Financial Reporting

Responsibilities                                                                            -Timing

Create a system of recurring journal entries                                    -Annual
Calculate and enter all adjusting journal entries                              -Monthly
Provide detailed analysis of accounts to auditors                            -Annual
Create financial statements                                                             -Monthly
Assist in writing footnotes to financial statements                         -Monthly
Assist in completing Securities Exchange reports                           -Quarterly

[9]. Financial Analyst

Reports to: Assistant Controller, Financial Reporting

Responsibilities                                                                          -Timing

Provide analysis of investment vehicles                                         -Ongoing
Review financing options                                                               -Ongoing
Review capital expenditure proposals                                            -Ongoing
Review acquisition candidates                                                       -Ongoing
Provide ratio analysis of company results                                     -Monthly

[10]. Tax Accountant

Reports to: Assistant Controller, Cost and Tax Accounting

Responsibilities                                                                         -Timing

Devise tax strategies for management approval                          -Ongoing
Create tax data collection systems                                              -As needed
Complete required tax forms in a timely manner                         -As needed
Update the company sales tax database as tax rates change       -As needed
Manage audits by taxation authorities                                         -As needed
Negotiate with tax authorities over tax payment issues              -As needed

[11]. Cost Accountant

Reports to: Assistant Controller, Cost and Tax Accounting

Responsibilities                                                                       -Timing

System Tasks
Review adequacy of activity-based costing system                   -Quarterly
Review adequacy of data collection systems                             -Quarterly
Review system costs and benefits                                             -Quarterly
Audit costing systems                                                              -Monthly
Analysis and Reporting                                                             -Tasks
Report on product target costing variances                              -Monthly
Report on activity-based costing overhead allocations            -Monthly
Report on break-even points by product and division             -Monthly
Report on margins by product and division                              -Monthly
Report on periodic variance analyses                                       -Monthly
Report on special topics as assigned                                       -Ongoing
Report on capital budgeting requests                                      -Ongoing
Assist in development of the budget                                       -Annual

Pricing Tasks
Work with marketing staff to update product pricing             -Ongoing

[12]. Bookkeeper

Reports to: Controller/Company Owner [for SME]

Responsibilities                                                                      -Timing

Calculate attendance bonus                                                    -Bi-weekly
Close software modules following the monthly close            -Monthly
Compile 401 (k) census information                                      -Annual
Complete bank reconciliation                                                -Monthly
Conduct job costing                                                              -Ongoing
Create financial statements                                                   -Monthly
Cut manual checks and enter them into the computer          -Ongoing
Enter accounts payable into compute and cut checks           -Weekly
Enter time cards and pay rate changes into computer           -Weekly
Issue paychecks                                                                    -Bi-weekly
Match accounts payable documents                                      -Daily
Post accounts receivable payments                                       -Daily
Process employee expenses                                                  -Ongoing
Reconcile petty cash                                                             -Monthly
Store backup information on fixed assets                            -Ongoing
Track warranty expense detail                                              -Ongoing

Note that the last job description presented, the bookkeeper, was semi-independent of the hierarchical structure assumed for all of the preceding positions. Rather than reporting to someone else below the controller, this person usually reports directly to the controller or business owner [in a small medium enterprise], a bookkeeper is usually much used in very small businesses which only need one or two accounting positions.

The first thing that needs to be in place to ensure competent internal auditors is effective human resource policies and practices. Here we are concerned with the attributes of successful internal auditors. A formal Practice Advisory deals with proficiency and requires that each internal auditor should possess certain knowledge, skills, and other competencies:

1. Proficiencies in applying internal auditing standards and procedures
2. Proficiency in accounting principles and techniques
3. An understanding of management principles
4. Appreciation of accounting, economics, commercial law, taxation, finance, quantitative methods and IT.
5. Skilled at dealing with people and communicating
6. Skilled in oral and written communications

The organization of the future will be a conveyor of ideas with the sourcing of products and services a secondary issue. The customer says what they want, and the organization delivers. Meanwhile the organization also helps the customer raise their sights in envisioning what is available. In this way, the organization of the future is a collection of visions and intellects brought together by a dynamic information and communications network. The importance of getting the right competencies in staff has never been more crucial to business success, and internal auditing is no exception.

Some of the attributes that the competent internal auditor needs to demonstrate include the following (in no particular order):

1. Ability to apply innovative and creative thinking.
2. Ability to work to agreed timescales and account for time.
3. Able to add value to the organization.
4. Able to appreciate concerns of stakeholders and focus on needs of the customer.
5. Able to appreciate new ideas and embrace and encourage change.
6. Able to establish credibility with senior management and at grassroots.
7. Able to function within flexible working arrangements.
8. Able to plan work and have a sense of urgency in performing the audits.
9. Able to quickly build relationships but retain professional stance.
10. Able to work under pressure and set priorities.
11. Ambitious and confident without being overbearing.
12. Appreciation of business environment and new ventures.
13. Appreciative enquiry—looking for the positive in human undertakings based on the great energies that come from success and accomplishments.
14. Balance and common sense with an overall sense of fairness and diplomacy.
15. Basic technical skill—financial, legal, economics, accounting, auditing, computing, statistics, other analytical techniques, database and spreadsheet use, data interrogations and so on.
16. Can cope with travel requirements and overnight stays.
17. Commercial awareness.
18. Committed to continuous learning and open to training and development.
19. Committed to working within set corporate policies and section procedures.
20. Communications skills, oral, public speaking, writing, report writing, effective listening, written and interpersonal skills at all levels.
21. Diplomatic but persistent where required.
22. Emotional intelligence and good balance of emotions such as anger, sadness, fear, enjoyment, love, surprise, disgust, shame—and humility. The ability to apply social skills such as trustworthiness, empathy, adaptability.
23. Enthusiastic, task-oriented person, able to focus on the job in hand.
24. Facilitation skills with an emphasis on challenge and co-ordination.
25. Formal report writing.
26. General management skills and able to provide direction, delegate and monitor results through performance review.
27. Global perspective and interest in international developments.
28. Good balance of consulting and assurance approaches and able to reconcile possible conflicts between helping people and reviewing systems.
29. Good decision making and judgment with no special bias to self-interests.
30. Good interviewing technique and able to empathize with the client.
    Good problem solver and able to weigh up pros and cons of different options and to see around the problem through to solutions.
31. Intellectual capacity and able to see things for what they are and ascertain causal relationships between problem, cause and effect.
32. Interpersonal skills recognizing group dynamics and people behavior.
33. Leadership and drive with a clear sense of direction.
34. Mature and professional enough to deal with different types of people and operate across different cultures.
35. Negotiation skills and some tenacity in sticking to crucial points.
36. Objectivity and independence with an ability to remain impartial.
37. Practical edge in applying policy and an understanding of any limitations.
38. Presentation skills.
39. Project management skills.
40. Self-motivated with good initiative, and enthusiastic even when performing mundane tasks.
41. Some commitment to developing a career in internal audit.
42. Task-focused and good at applying energies to delivering results.
43. Team player—able to buy into team working and team tasks with an understanding of the importance of being friendly, participative and helpful, and having fun where possible.
44. Track record of achievement and completion of tasks.
45. Understanding of internal audit procedures and quality requirements.
46. Understanding of modern audit techniques including corporate governance, risk management and control.
47. Understands big picture but can respond to detail when required, notwithstanding apparent ambiguity.

The new look creates a very demanding role. It includes all those aspects that make a good traditional auditor with a hard nose and deep concern with getting to the truth, and the new approach of being a top-flight consultant on risk and control issues.

Audit Training and Development

Training is an important aspect of developing internal auditors, and has to be carefully planned in line with a career developmental program. A professional level builds on and extends the subjects that are covered at practitioner stage. As well as internal auditing topics, there is coverage of financial and general management, information systems and a new module dedicated to the topic of corporate governance and risk management. The advanced internal auditing paper is based around a case study that is available before the examination date, so reflecting the growing trend towards more practical work.

There is an entire spectrum of developing people at work that includes:

1. Training—program for getting people to learn to do things differently.
2. Development—untaught activity to increase/improve performance.
3. Education—formal courses to develop knowledge and qualifications.
4. Learning—acquiring better skills, knowledge and attitudes.

There are various ways that audit staff may be trained and developed:

1. Specialist skills training via internal or external skills workshops - These can be extremely efficient in terms of auditor development.
2. Professional training - This may be based on passing examinations of a defined professional body such as the Institute of Internal Auditors, which is a completely different form of training from skills-based courses.
3. The training coordinator - Appointing a training co-ordinator is a positive way of promoting various training program, particularly where the co-ordinator can undertake some of the actual training.
4. Directed reading - This is one way of encouraging auditors to research aspects of internal audit. The department should subscribe to all relevant journals and publications.
5. Training through work - Programmed audits enable audit management to ensure auditors are rotated and exposed to a variety of audits and experiences. It is possible to designate smaller audits as ‘training audits’ where they form part of the auditors’ personal development program.
6. The audit review - The audit review process enables audit managers and team leaders to direct the work of junior staff and also provides experience in staff management.
7. Professional affiliations - These can be part of continuing professional development (CPD) and stimulate group discussions.
8. The audit manual - This sets out the defined methods and procedures required to discharge the audit mission.

Training is part of the managerial process and as such forms only one constituent of the overall system of human resource management. It cannot be seen in isolation from the other techniques for developing audit staff. Not all auditors remain in the audit shop for long periods of time. This ‘short-stay syndrome’ results because organizations view internal audit as an ideal place to train managers. There are many who do not view internal audit as a career in its own right and, for example, trainee accountants may wish to return to main line accountancy after a spell in audit.

This poses a problem in that extensive training is lost on audit staff who will not remain with the department for long. All staff should be developed and those who may wish eventually to leave auditing will simply be replaced by other auditors. Vacancies create scope for internal promotions for auditors who excel via their development programmes. The only concern is that short-stay staff should not be placed on professional qualification programs as these last several years and require a major commitment to a career in internal auditing.

Financial professionals play a critically important part in all M&A activities. Often CFOs, controllers, and their functional equivalents (throughout this chapter referred to as financial officers) are logical candidates to play a central role in the acquisition process, and invariably should be involved in the transaction from beginning to end.

Although executed for strategic purposes, acquisitions are essentially financial transactions. As such, a fundamentally sound acquisition process typically draws on these skills and expertise of the financial manager:

1. The ability to apply rigorous financial analysis to ensure sound decision making
2. An understanding of the tax implications associated with the various forms a transaction may take
3. An understanding of the applicable regulatory requirements
4. The ability to model and/or critically evaluate business valuations
5. Familiarity with the various financing options available as well as the ability to take a leadership role in structuring a financing package, if necessary
6. Familiarity with the principles of acquisition accounting and their application
7. The ability to plan, coordinate, and execute an efficient and effective due diligence review

In addition to these financial/accounting capabilities, the senior financial officer involved in the acquisition process should also have strong leadership, organizational, and communication skills. A successful acquisition requires a substantial amount of cooperation and coordination among professionals and experts, both financial and non-financial, within and outside the acquiring company. It is imperative that those providing leadership ensure that the process is rationally structured (i.e., that the steps in the process are properly sequenced) and that the efforts of all those involved are not compartmentalized (i.e., that individual efforts are integrated and that all valid inputs are synthesized).

Coordination

As a member of the core team managing an acquisition, the financial officer will have responsibility for coordinating much of the planning and execution of internal and external team members. This includes various line managers within the acquiring organization, as well as accounting, tax, and legal and other specialists who may reside outside the organization and/or in corporate headquarters in the case of larger, multilayered organizations.

1. Internal Coordination. The financial officer within the acquiring organization will generally be a co-equal partner with the business executives tasked with evaluating the merits of a transaction, making recommendations whether or not to proceed, and developing a plan of action, if the transaction is to be pursued. Additionally, he or she would play an important role in determining what internal resources would be needed to further evaluate the target company, to perform due diligence and, ultimately, to execute the transaction.
2. Coordination of External Experts. The financial officer is the logical point of contact in dealing with a wide range of accounting, tax, legal, and regulatory issues and processes. Outside accounting and auditing resources may be accessed to conduct preliminary assessments and financial due diligence. The financial officer must also interface with the target company’s internal and outside accountants. And, he or she will have responsibility for ensuring that acquisition accounting is properly implemented. The financial officer is also the logical coordinator of input from internal tax professionals or external tax advisors. Tax expertise is drawn on early in the acquisition process to determine the tax ramifications in structuring the transaction and is involved in the post–due diligence stage to ensure optimal tax treatment prospectively. Financial and legal considerations intersect frequently throughout the acquisition process. The financial officer is the logical individual to coordinate with legal counsel to ensure compliance with regulatory requirements and coordination of tax and legal issues, including the drafting of the Letter of Intent, ensuring compliance with SEC regulations, state law, and antitrust statutes, and negotiation of the final Purchase Agreement. The financial officer also has a role to play in the financing process. This can range from the simplest type of involvement for a large company, such as notifying the corporate treasury function that money has to be wired to the bank of the sellers at closing date, to very complex negotiations with those funding the acquisition for a smaller organization.

Financial Analysis

Not surprisingly, the financial officer plays an important role in analyzing the transaction and modeling the target company’s business. This includes, among other things, evaluating the target company’s business model and financial dynamics in the context of the acquirer’s investment objectives and establishing the value of the target company.

1. Financial Criteria and Metrics. The financial officer provides critical input on the appropriateness of strategic fit, the reasonableness of projections of growth and profitability and assumed synergies and efficiencies, as well as comparisons of the acquiring company’s projected performance before and after the proposed acquisition (to measure such things as potential accretion and dilution). These are important judgments and measurements for establishing a basis for a preliminary decision to proceed with a transaction.
2. Valuation. Establishing a preliminary view of value and updating that view as additional information becomes available is a major role of the finance function in the evaluation of an acquisition. There is a variety of valuation methods used in the acquisition process, but larger, acquisitive organizations generally have a standard approach and models that are used to determine value, returns on invested capital, and other investment hurdles. Smaller, less acquisitive organizations may engage a valuation expert on a consulting basis. In either case, development of a credible valuation model requires a detailed understanding of the financial dynamics of both the acquiring and target companies and how synergies and efficiencies can be realized (and quantified) by the two. The financial officer is, unquestionably, in the best position to make these determinations.

Determination Of Deal Structure

The financial officer is a key player in determining how the transaction can optimally be structured. Some of the major aspects of the potential structure he or she would consider are:

1. Assets versus Stock. Almost invariably, the buyer will prefer to buy specific assets (vs. the stock) of the target company, because it enables the buyer to be selective about which assets are purchased and reduces the buyer’s exposure to hidden liabilities and generally reduces its tax liabilities. Conversely, the seller will prefer a sale of stock, so that unfavorable tax treatment can be avoided and all assets and all liabilities are included in the transaction. There are special situations in which the seller can treat a stock sale as an asset sale and the buyer can realize some of the benefits of an asset sale. The financial officer, often in combination with tax specialists, can determine the range of acceptable options and quantify their costs and benefits.
2. Earn-Outs. Earn-outs are an approach to risk sharing between the buyer and the seller. They provide the seller with upside potential in the form of additional consideration tied to company’s post-acquisition performance above a defined level (usually measured by revenue and/or profit). The financial officer is in the best position to determine if the use of an earn-out makes strategic and economic sense and, if so, how the earn-out should be structured.
3. Working Capital Adjustments. Letters of Intent will frequently require that sufficient working capital is left in the business at the point of the acquisition to fund ongoing requirements. In such cases, if the working capital falls below that level, then the purchase price would be adjusted downward accordingly. These adjustments are designed to offset any unusual removals of cash from the business. An analysis of the working capital dynamics over time by the financial officer is necessary to determine a fair and suitable working capital target, if a working capital adjustment is contemplated.

Due Diligence

Clearly, the lead financial officer involved in the acquisition should have responsibility for financial due diligence. This would include establishing due diligence objectives, managing the process, and reporting on its results. These functions are briefly discussed below:

1. Establishing Due Diligence Objectives. Although the due diligence process varies from transaction to transaction, there are some aspects of the process that are standard, regardless of the size and nature of the transaction. This includes the overarching objectives of the review, which are to verify historical results and to validate forecasts and key assumptions (such as synergies, growth rates, and anticipated efficiencies) related to the valuation that the acquirer has established. The financial officer should be the primary architect in establishing these objectives.
2. Managing the Due Diligence Process. By virtue of expertise and experience, the finance function is a logical one to take a lead role in structuring the due diligence program and process. A due diligence review is by no means the same as an audit. Constraints on time and resources limit the depth of the evaluations conducted. However, a due diligence review is analogous to an audit, and the types of procedures that should be reflected in the program are not unlike what one would find in an audit program. The financial officer and his or her staff will generally have the experience and expertise to shape the program and coach non-accountants in performing the review.
3. Reporting on Results. Finance professionals are co-equal commentators, along with the business managers involved in the process, on the results of the due diligence.

Because an acquisition is fundamentally an investment decision, recommendations to proceed or to disengage will largely be based on whether due diligence supports or contradicts the valuation that has been established. The financial officer is clearly in the best position to make such determinations.

Further worth reading about merger and acquisition:

Managing Merger and Acquisition (M&A)

Central Role Of Strategic Planning In The Merger And Acquisition Process

Types Of Merger and Acquisition (M&A) Activity

Merger & Acquisition (M&A) - Acquisition Process

Merger and Acquisition (M&A) - Sales Process

Merger and Acquisition (M&A) - Divestiture Process