How to Transition From Accounting to Finance — Optim Careers (2024)

A common question that many accountants will come across in their career is how to transition out of accounting and into a finance or FP&A role?

While accounting can be a rewarding career for some, for many, there comes a point where there isn't much more to be gained by staying in the field. Yes, we know all the rules, guidelines, best practices, etc., but if you're like me, you know there is a clear limit to how far you can go on a pure accounting path.

At a certain point in time, the pedantics, the overly specific rules, and regulations leave little to be desired in the accounting field as we look to advance from entry-level to mid and senior-level employees. We want to have an impact and to feel like what we do matters. In many cases, reconciling GL balances to the penny doesn't quite do it; we want to be involved with the organization's strategic direction and feel like we can have a real impact. The same monthly routine, box-checking, and follow rules that lack common sense principles can grind your soul to a pulp.

A background in accounting is an incredibly valuable asset when it comes to changing paths. To succeed in finance, you must know the basics of debits and credits, accruals, revenue recognition, COGs, Inventory, balance sheets, and income statements. Finance professionals without this background often struggle to explain fluctuations and tell a complete story.

That is where a transition to finance comes in. While the two fields of accounting and finance are closely related, the skills and abilities between the two are very different. The first step you should take is the research you're conducting by reading this article and others like it. The second step is to apply the advice before you start applying for new roles.

Master Excel

The first skill set to consider if you want to transition to finance is becoming an Excel master. No, just barely knowing how to use vlookup is not considered expertise. Either is copy/paste. Being an expert means knowing how to use and reference the program's most dynamic and advanced features. The list below has a quick list of must-know functions.

Aside from Excel functions, you should also know and master Excel formatting to make workbooks look clean, organized, and professional.

Must know Excel functions:

Sumif

Sumifs

Countif(s)

Vlookup

Index

Index-Match

Pivot Tables

Logical Operators

Text Functions

Data Tables

Quick Access Tool Bar-Bonus

See Also

Accountant Career Path Vs. Finance Career Path

Cell Formatting-Bonus

Conditional Formatting-Bonus

Indirect-Bonus

Sumproduct-Bonus

Master PowerPoint

Groan all you want, or keep telling yourself that "PowerPoint is dead," but the truth of the business world is that PowerPoint is very much alive and kicking. When you present anything to the business from a finance role, PowerPoint is the go-to tool for presenting and explaining the context behind the numbers.

To prepare for a transition, take courses to learn the basics and advanced features and then practice applying your skills. If there is a known PowerPoint guru in your organization or network, it will be highly advantageous to seek them out, buy them coffee, and pick their brain to learn the inner working of an excellent presentation. Ask to watch them work and take notes.

If you try and get by in finance by presenting through Excel workbooks, you'll create lots more confusion and frustration than you could ever imagine.

Mindset

Perhaps the biggest challenge to some in going from accounting to finance will be the change in mindset. Accounting is very much about following the rules, regulations, and procedures. Numbers must reconcile to the penny, the perspective is backward-focused, and accuracy is critical. On the other hand, finance is forward-looking, requires dealing with ambiguity, and being flexible. Directionally correct answers are more important than those that are precisely wrong. Finance is about gathering the most current assumptions, documenting them, and building them into a story. Accounting provides an account of what happened and creates a clear record of resources available. Finance asks where to allocate resources to create the most value for the company.

Speed and flexibility are more important than spending too much time to produce an analysis that is 100% correct but late and therefore useless.

In my experience, I've seen professionals who transition from public accounting to FP&A have a more challenging time than those already in the corporate world. For one, you need to learn to recognize that there are very different styles of working. Public accountants are well-known for following rules and procedures and need to learn to adapt to the new culture rather than forcing their known way of working onto others.

Systems

Systems knowledge is another critical skill to finance professionals. Finance is about building an ecosystem where systems speak to each other, processes are improved to produce clean data, and automation is built in wherever possible.

If this sounds like I am speaking another language to you, then hit the books (Google) to learn about the most common and modern systems and ways of working in practice today. A general rule of finance functions is that 80% of questions should be quickly answered using the systems to do the heavy lifting of math and computations to produce the answers. Thus, more time can be spent on higher-value activities of business partnering and working with others.

Business Partnering

Accountants love to sit in their little accounting departments, talk about accounting to other accountants, and live a generally routine life of the month-end close, reporting, SOX, and quarterly/annual filings.

To transition to finance, though, you will need to prove that you are a much more dynamic professional who can grow beyond your comfort zone. To not just survive but thrive in finance, you need to be able and willing to branch out and talk shop with other functions. You need to understand their needs, challenges, and opportunities and then adapt to help them solve their problems. You need to know how the business you are in actually makes money and works.

You will need to establish strong working relationships to get the inside scoop for what is going on and upcoming in the business. Working on soft skills is a bit of a marathon, but investing here will pay off with significant dividends. An effective finance professional will know the key drivers of business profitability, growth, and variances without thinking.

You will need to know how to explain business results and variances from targets in the common language.

Practice Forecasting by Understanding Business Drivers

Business Intelligence

Excel is only ever the starting point for finance professionals. A modern finance function runs on advanced BI (Business Intelligence) tools that do the heavy lifting of ETL (Extract, Transform, & Load) from a data source to quickly, accurately, and powerfully produce answers with the click of only a few filters in a dashboard.

The age of screwing around and manipulating data for hours is outdated and a sure way to prove that you aren't a fit for your new role. If you are planning to transition to finance, you must spend time and money enrolling in courses first to understand what BI is, how to use it, and finally, how to apply it to your work.

Earn Your Way In

Credentials hold a lot of weight in the finance and accounting world. Essentially, they tell others that you have put in the time, energy, and money to learn the fundamentals of the profession. While in public accounting, the CPA holds weight, the CMA is king in the finance world. There are also more specific credentials, such as the CFA if you're headed towards Wall Street or the lesser-known but upcoming FPAC from AFP.

If you're not sure what credential will be best for you, go to LinkedIn, search for jobs you are interested in and look at the job requirements. Take a look at 10-20 roles and start to identify common patterns and requirements. Even if a credential is explicitly named, having one or more will get your resume to the top of the pile and increase your odds of at least getting an initial interview. From there, you can charm them to death.

Summary