Role of an Accountant in a Firm's Operation

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The role of an accountant in a firm's operations can be as simple as data entry or as complex as a tax law compliance officer. The accountant is ultimately responsible for the accuracy and presentation of the firm's financial operations. Because accounting--with all its intricacies--is the basis of business decisions, the roles an accountant may play within a business are many and varied.

Facts

Accounting is the foundation for all of a firm's financial transactions and decisions. Accountants record, classify and categorize business transactions. The extent of an accountant's role depends on the size of the organization. In small offices, the accountant handles all financial transactions. In larger firms, the accountant can supervise accounting personnel, assist in decision making, ascertain compliance with Generally Accepted Accounting Principles (GAAP), and have ultimate responsibility for accounting operations. In all roles, the accountant ascertains the correctness of financial information.

Roles

The accountant has a variety of administrative roles within a firm's operations. In smaller firms, the accountant plays the role of the data-entry person and generates financial reports.
As an adviser and interpreter, an accountant presents the firm's financial operations to others. Third-party financial contact is another role, because financial institutions, vendors and customers are all in contact with the accountant. As analysts, they perform ratio and account analysis on financial data to aid business decisions.

Types

The type of role an accountant plays in a firm's operations also depends on the type of industry. Public accounting involves working with numerous businesses as an independent financial professional. In private industry, the accountant could work in internal control and help ensure internal compliance with the firm's policies. Or the accountant could have the role of legal compliance officer regarding current laws. As a controller, the accountant's role would be one of an overseer of financial information accuracy. In manufacturing, the accountant could have the role of cost accountant and know the strategic intricacies of the manufacturing process.

Significance

An accountant plays a vital role in the firm's operations by ensuring that financial transactions are properly recorded and classified. This position makes certain that the firm's financial picture gives a realistic depiction of the operations at a certain point in time. Maintaining proper financial records is a requirement of the IRS, and a competent accountant will make certain this requirement is fulfilled. An accountant also plays a key role in presenting the financial information to decision makers in an way that's easy to understand.

Benefits

A key beneficial role an accountant plays in the firm's operations is as an advocate for compliance with applicable laws. This includes meeting deadlines, paying correct amounts, avoiding penalties and interest, and obtaining good payer discounts. Another benefit involves having the accountant as a researcher of financial information who assists in making financial decisions regarding firm valuation, ascertaining liquidity levels, risks of potential financing arrangements, asset valuations, viability of investments and stock valuations.

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References

  • Accounting: The Basis of Business Decisions; Walter B. & Robert F. Meigs; 1990
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