What is a project accountant? (Duties and skills)
Project accountants focus on tracking the costs, expenses and cash flow of a specific project. This role requires specialised accounting abilities to accurately analyse and report a project's finances across its entire lifespan. Learning about project accountants' duties and requirements can equip you with a strong understanding of the opportunities and challenges that project accountants encounter and help you decide if you want to pursue this career. In this article, we answer 'What is a project accountant?', explore the role's responsibilities, discuss its requirements and share key skills for success in this profession.
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What is a project accountant?
To answer the question 'What is a project accountant?', they're individual who monitor the progress of projects and their financial metrics. The key purpose of this role is to make sure that customers receive invoices in a timely manner and that the organisation collects project-related payments on time. Project accountants also work directly with project managers, providing them with pre-billing information, invoices and cost estimates. They usually report directly to the accounting supervisor and project managers.
Responsibilities of project accountants
Project accountants work closely with project managers and focus on a project's finances to ensure the team provides successful services to clients. Here are examples of duties for which project accountants are responsible:
Generating budget reports and documentation
Overseeing a project's budget is a priority for project accountants. They ensure the project manager has access to the latest and most accurate information about the costs, expenses and earnings from a project. As part of their duties, project accountants regularly generate budget reports, including information about work plans and fee structures.
In addition to collecting and presenting budget information, project accountants review project budgets. Before a project manager implements a budget plan, they may consult with the accountant to make sure the schedule complies with internal regulations and national accounting standards. For example, accountants make sure that financial project milestones align with the organisation's invoicing schedule. As part of this, accountants also make sure a project's finances and budgets comply with standards that the Financial Reporting Council sets.
Issuing invoices and purchase orders
Invoices and purchase orders may include similar or even identical information, but these documents have different purposes. Project accountants handle both types of documents within a project. Typically, they start with scheduling purchase orders, which define the services or products that the project team is about to provide to a client.
A standard purchase order features elements such as payment terms, price and delivery date. After the client finalises the purchase, an accountant issues an invoice describing the goods that the project team delivered. Other examples of invoice elements include the price per unit that the organisation sold or the contact information of the buyer and seller.
Project accountants are responsible for all financial transactions in a project. This means that they also process incoming and outgoing payments that directly relate to the project's resources or delivery. For example, if a project involves working with contractors or freelancers, the accountant calculates and processes their weekly or monthly payments.
Updating budgeting documentation
Project managers regularly evaluate project progress to make sure the team has the necessary resources to create and submit deliverables on time. Once they reach a milestone, they review and analyse the project budget and update it if necessary. During this process, project accountants gather financial information from the manager and update any documentation that relates to the project, including documents estimating the total cost of the project. They also use these budget amendments to update client and supplier contracts.
Preparing annual reports
Once a calendar year ends, accountants begin preparing annual reports that help with evaluating project costs and earnings. As part of this, they analyse working capital and tax reports. Project managers who oversee long-term projects use these reports to compare the latest project information with historical data to see how the team's efficiency or productivity has changed over time.
Requirements for project accountants
Requirements that employers set for project accountants vary depending on the size of the organisation and the types of projects. Here are some basic educational, experience and qualification expectations employers may have:
To work as a project accountant, you require a degree in accounting, finance or a related field that allows you to develop expert knowledge of numeracy and finance. Completing an undergraduate course of this type usually takes three years, but it can extend to four years if you choose a programme with an industry placement. To qualify, you require at least three A levels at grade AAB, including maths, business or accountancy.
If you already have a degree in another subject, such as business administration, consider choosing accounting or finance for your master's. Another course to consider is a master's programme in project finance. This course helps you gain expert accountancy knowledge that you may use to perform project accounting duties, such as preparing budget reports and project cost estimates. Postgraduate courses usually take one year if you study full-time and two or more years if you study part-time.
When hiring project accountants, employers prioritise candidates with at least two to five years of experience in accounting. Having some understanding of project accounting processes is desirable, but most organisations provide successful candidates with introductory on-the-job training as part of their onboarding. What employers want to know is that candidates have experience working with and reporting to project managers. This means that having any project management experience may increase an accountant's chances of entering project accounting.
To increase your chances of becoming a project accountant, you may invest in off-the-job training. Employers may prioritise candidates with Certified Public Accountant (CPA) or Certified Management Accountant (CMA) status. In addition, certificates in project finance modelling, corporate finance and project coordination may help you advance to later stages of recruitment.
Key skills for project accountants
As a project accountant, it's useful to have strong attention to detail and maths skills. In addition to these competencies, you may succeed by developing the following practical skills:
Accounting software and systems: Project accountants use accounting software to generate invoices, manage project financial documentation or automatically generate annual or monthly financial project reports. Organisations usually choose which software to use according to their size and the volume of financial documents they process, but if you want to determine which tools a potential employer uses to prepare for an interview, consider asking a recruiter about this.
General ledger management: This is a process that allows project accountants to oversee the reporting and recording of financial figures in their accounting databases. For example, this skill helps accountants prepare financial statements and perform regulatory reporting duties.
Financial forecasting and budgeting: Financial forecasting helps accountants estimate the amount of money a team is likely to use to complete a project and how much money it can generate doing so. Forecasting is a key element of budgeting, which helps accountants and project managers to compare their estimations with actual cost and revenue statements.
Project invoicing and billing: When issuing invoices or billing customers, accountants follow a strict schedule, which helps them make sure the organisation receives and pays money on time. To improve invoicing and billing, accountants may use various automation tools, including email reminders.
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