
SFU-008 - Module 1 (Chapters)
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Created on September 17, 2024
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Transcript
Hello, and welcome, I’m Christine Smith, an Accountant, and I’m your industry expert guiding you through this Springpod For Universities Online Career Readiness Experience, in association with The University of Liverpool. As somebody that has worked in this field for a long time, I’m really excited to invite you and encourage you through an opportunity that could seriously boost your career prospects. Throughout this experience, you’ll be provided with a deep dive into the Finance Industry, learn about what it means to work as an Accountant, and get hands on experience with the hard skill of ‘Break-Even Analysis’. I’d like to say this - I wish I’d had such an opportunity back when I was studying!Being confident in Break-Even Analysis will give you a real competitive edge - after all, hard skills are the currency of today’s data-driven workplaces. Employers are on the lookout for candidates who not only understand the fundamentals, but can also walk into a job on day one ready to contribute meaningfully. By completing experiences such as this, you’re one step closer to being that candidate. In addition, we’ll be focusing on the all-important soft skill of ‘Trustworthiness’. This involves being consistent and acting with integrity, transparency and reliability. Building trust is a key skill that’s going to support you as an Accountant, and within the Finance industry as a whole. You’ll get the chance to complete industry-validated, work-based activities that mimic real-world tasks, complete with learning objectives, model answers, and learning outcomes. By the end of the experience, you’ll earn a certificate of completion - a valuable addition to your CV that shows employers you’re not just another graduate, but a job-ready candidate who stands out. Speaking from personal experience, the blend of these technical skills and interpersonal insights can set you apart from the rest. When I started out, I had to learn many of these lessons on the job. This experience gives you the advantage of developing them before even stepping into the workplace. I’m really looking forward to seeing where your data journey takes you, and guiding you along the way! Warm regards,
Christine SmithAccountant
Chapter 1
Finance Industry
Chapter 2
What is an Accountant?
Chapter 3
Hard Skill: Break-Even Analysis
Shaping your future
Let's start with the basics of the finance industry. In the next four chapters, we'll explore the key areas and roles you can pursue within this field, along with the latest industry trends. Be sure to take notes, there's a quiz at the end!
Start
Finance Industry
What are the key areas of this industry?
The Finance Industry is a vast and multifaceted sector that encompasses various disciplines aimed at managing money, investments, and financial planning. It involves the application of financial theories, practices, and tools to drive economic growth, ensure financial stability, and maximise returns. Here is an overview of the Finance Industry, including its key areas, roles, and trends.
What job roles can I pursue?
What are the current trends?
Conclusion
Chapter 1
Index
What we'll cover...
What are the key areas of the Finance Industry?
Chapter 1
Corporate Finance
Investment Banking
Asset Management
Retail Banking
Wealth Management
Risk Management
Financial Planning
Insurance
Key areas
What job roles can I pursue in the Finance Industry?
Click the job roles to reveal more info!
Chapter 1
job roles
Analyses financial data to support decision-making.
Financial Analyst
Investment Banker
Portfolio Manager
Risk Manager
Wealth Manager
Insurance Underwriter
Corporate Finance Officer
Financial Planner
Auditor
Loan Officer
Assists clients in raising capital and provides financial advisory services.
Manages investment portfolios on behalf of clients.
Identifies and mitigates financial risks.
Manages a company’s financial activities.
Offers financial planning and investment advice to individuals.
Assesses risk and determines insurance policy terms.
Helps individuals and businesses plan their financial futures.
Reviews financial statements and ensures regulatory compliance.
Evaluates, authorises, and recommends approval of loan applications.
What are the current trends in the Finance Industry?
Fintech Innovations
Regulatory Changes
Digital Transformation
Globalisation
Sustainable Investing
Data Analytics
Cybersecurity
Customer Experience
Chapter 1
Current trends
Remote Work
So, in conclusion…
Chapter 1
Conclusion
The Finance Industry is a dynamic and evolving field that plays a crucial role in driving economic growth and ensuring financial stability. It spans various disciplines, each with its unique focus, tools, and applications. As technology advances and global financial environments change, the Finance Industry continues to adapt and innovate, providing valuable insights and solutions to improve financial performance and stability.
Chapter 1
Finance Industry
Chapter 2
What is an Accountant?
Chapter 3
Hard Skill: Break-Even Analysis
Start
Chapter 2
Index
Accountant
What is an Accountant?
Great job on completing chapter one! In chapter two, we'll dive into a career as an accountant, exploring the role in detail and focusing on financial record keeping and reporting, audit and assurance, and cost management. An Accountant is a professional responsible for managing and interpreting financial records to ensure that organisations operate efficiently, comply with laws and regulations, and make informed financial decisions.
What are the key responsibilities?
What are the skills and tools needed?
What career path and education is ideal?
What we'll cover...
Summary
What is an Accountant?
Chapter 2
What is an accountant?
An Accountant is a professional responsible for managing and interpreting financial records to ensure that organisations operate efficiently, comply with laws and regulations, and make informed financial decisions. This role involves recording financial transactions, preparing financial statements, and analysing financial data to support business operations. Here is a detailed overview of what an Accountant is and what they do: Accountants focus on the financial health of an organisation by maintaining accurate financial records and providing insights that guide business strategy. Their goal is to ensure that an organisation’s financial information is accurate, timely, and in compliance with relevant laws and standards. In a business world where financial transparency and accountability are paramount, Accountants play a crucial role in helping organisations manage their resources effectively. Accurate accounting can lead to better financial decision-making, improved profitability, and enhanced stakeholder confidence.
What are the key responsibilities of an Accountant?
Chapter 2
Financial Record Keeping
Financial Reporting
Tax Compliance and Planning
Audit and Assurance
Collaboration and Communication
Key responsibilities
What are the skills and tools needed to be an Accountant?
Attention to Detail
Analytical Skills
Ethical Standards
Communication
Accounting Software
Spreadsheet Software
Tax Software
Auditing Tools
Chapter 2
Key SKILLS & TOOLS
KEY SKILLS
COMMON TOOLS
What career path and education is ideal for becoming an Accountant?
career path & education
Educational Background:
Career Progression:
Accountants typically have degrees in Accounting, Finance, or related fields. Many Accountants also pursue certifications such as Certified Public Accountant (CPA), Chartered Accountant (CA), or Certified Management Accountant (CMA) to enhance their career prospects and credibility.
Entry-level Accountants may start as Junior Accountants or Accounting Assistants, focusing on tasks such as data entry and financial reporting. With experience and additional certifications, they can advance to roles such as Senior Accountant, Accounting Manager, or Controller. Specialisations within the field include roles like Tax Accountant, Auditor, Forensic Accountant, and Financial Analyst.
Chapter 2
So, in summary…
Chapter 2
summary
In summary, an Accountant plays a vital role in ensuring the financial integrity and success of an organisation. By focusing on accurate financial record-keeping, reporting, and compliance, they provide the financial insights needed to guide business strategy and operations. The work of an Accountant spans from daily transaction recording to preparing detailed financial reports and ensuring compliance with tax laws, requiring a combination of analytical, technical, and ethical skills.
Chapter 1
Finance Industry
Chapter 2
What is an Accountant?
Chapter 3
Hard Skill: Break-Even Analysis
Start
Chapter 3
Index
Hard Skill: Break-Even Analysis
Introduction to Break-Even Analysis
Break-Even Analysis is a crucial hard skill for Accountants. It enables them to determine the point at which a company’s revenues and expenses are equal. This skill is essential for evaluating the financial viability of a business or project, helping decision-makers understand the minimum sales volume needed to avoid losses and start generating profits.
Identifying and classifying costs
Calculating Break-Even Points
Evaluating profitability scenarios
What we'll cover...
Communicating insights to stakeholders
Chapter 3
Hard Skill: break-even analysis
The initial step in Break-Even Analysis involves identifying and classifying costs. Accountants begin by categorising costs into fixed and variable components. Fixed costs are expenses that remain constant regardless of production levels, such as rent, salaries, and insurance. Variable costs fluctuate with production volume, including materials, labour, and utilities. Understanding these cost structures is vital for accurate break-even calculations.
With the data collected, BI Analysts synthesise the information to create actionable insights. This process includes data cleaning, integration, and advanced analytics techniques such as regression analysis, clustering, and predictive modelling. BI Analysts use tools like SQL, Python, R, and data visualisation software such as Tableau and Power BI to uncover patterns and trends. For instance, they might analyse sales data to identify the most profitable customer segments or use social media data to gauge consumer sentiment about a brand.
Chapter 3
Hard Skill: break-even analysis
The initial step in Break-Even Analysis involves identifying and classifying costs. Accountants begin by categorising costs into fixed and variable components. Fixed costs are expenses that remain constant regardless of production levels, such as rent, salaries, and insurance. Variable costs fluctuate with production volume, including materials, labour, and utilities. Understanding these cost structures is vital for accurate break-even calculations. With costs categorised, Accountants proceed to calculate the break-even point. This is typically done using the formula:
With costs categorised, Accountants proceed to calculate the Break-Even Point. This is typically done using the formula:
Chapter 3
Hard Skill: break-even analysis
The initial step in Break-Even Analysis involves identifying and classifying costs. Accountants begin by categorising costs into fixed and variable components. Fixed costs are expenses that remain constant regardless of production levels, such as rent, salaries, and insurance. Variable costs fluctuate with production volume, including materials, labour, and utilities. Understanding these cost structures is vital for accurate break-even calculations. With costs categorised, Accountants proceed to calculate the break-even point. This is typically done using the formula:
This calculation determines the number of units that must be sold to cover all costs. Alternatively, the Break-Even Point can be expressed in terms of sales revenue using the formula:
Accountants use tools like spreadsheets or accounting software to perform these calculations efficiently.
Chapter 3
Hard Skill: break-even analysis
Next, Accountants use Break-Even Analysis to evaluate profitability scenarios. By adjusting variables such as selling price, cost structures, or sales volume, they can model different financial outcomes. For example, they might assess how a change in supplier pricing or a rent increase would impact the Break-Even Point. This analysis helps businesses make informed decisions on pricing strategies, cost management, and sales targets.
Accountants also play a key role in communicating Break-Even Analysis insights to stakeholders. They create detailed reports and visualisations, such as graphs and charts, to present the Break-Even Point and its implications clearly. This information is crucial for managers, investors, and other decision-makers as they develop business strategies, budget plans, and investment decisions.
Chapter 3
Hard Skill: break-even analysis
In summary, Break-Even Analysis is a fundamental hard skill for Accountants that involves meticulous cost classification, accurate financial calculations, and strategic scenario planning. By mastering Break-Even Analysis, Accountants provide valuable insights that guide businesses in achieving financial sustainability and profitability.
That's a wrap!
Mark this section as complete to access the quiz and test your knowledge!
Attention to Detail: High level of accuracy and attention to detail in recording and analysing financial data.
Heightened regulatory scrutiny and compliance requirements.Implementation of new regulations such as GDPR and MiFID II.
Financial Record Keeping
Recording Transactions: Documenting all financial transactions accurately, including sales, purchases, receipts, and payments. General Ledger Maintenance: Maintaining and updating the general ledger, which is the core of a company’s financial records.
Accounting Software: QuickBooks, SAP, Oracle Financials.
Expanding use of big data and analytics to drive decision-making. Leveraging AI and machine learning for predictive analytics and risk management.
Analytical Skills: Ability to analyse financial information, identify trends, and provide insights that support decision-making.
Risk Management
- Focus: Identifying, assessing, and mitigating financial risks.
- Applications: Credit risk analysis, market risk management, operational risk assessment.
- Tools: Value-at-risk (VaR) models, stress testing, risk assessment matrices.
Increasing integration of technology in financial services. Emphasis on mobile banking, blockchain, and robo-advisors.
Financial Reporting
Preparing Financial Statements: Compiling financial statements such as balance sheets, income statements, and cash flow statements that provide a snapshot of the organisation’s financial health. Budgeting and Forecasting: Assisting in the development of budgets and financial forecasts to guide business planning and decision-making.
Ethical Standards: Strong sense of ethics and integrity, as Accountants handle sensitive financial information.
Collaboration and Communication
Working with Stakeholders: Collaborating with other departments, such as finance, operations, and management, to ensure accurate financial reporting and compliance. Presenting Financial Data: Communicating financial information to stakeholders in a clear and understandable manner, helping them make informed decisions.
Insurance
- Focus: Providing risk management through insurance products.
- Applications: Underwriting, claims management, policy administration.
- Tools: Actuarial software, policy management systems, claims processing systems.
Investment Banking
- Focus: Assisting clients in raising capital and providing advisory services.
- Applications: Underwriting, mergers and acquisitions advisory, trading securities.
- Tools: Financial modelling, valuation techniques, pitch books.
Enhanced focus on improving customer experience through personalised services. Utilisation of customer journey mapping and advanced Customer Relationship Management (CRM) systems.
Auditing Tools: ACL Analytics, CaseWare IDEA.
Adoption of digital technologies to enhance operational efficiency.Integration of cloud computing, AI, and IoT in financial services.
Expansion of financial markets and cross-border transactions. Focus on managing currency risks and regulatory differences.
Increasing importance of cybersecurity measures to protect financial data. Implementation of advanced security protocols and threat detection systems.
Wealth Management
- Focus: Offering financial planning and investment advice to high-net-worth individuals.
- Applications: Estate planning, tax optimisation, retirement planning.
- Tools: Financial planning software, investment management platforms, tax software.
Tax Software: TurboTax, H&R Block, TaxSlayer.
Growing focus on environmental, social, and governance (ESG) criteria in investment decisions. Adoption of green finance and impact investing strategies.
Shift towards remote work and virtual collaboration in financial services. Utilisation of online platforms for communication and project management.
Tax Compliance and Planning
Tax Preparation: Preparing and filing tax returns for individuals or businesses, ensuring compliance with tax laws and regulations. Tax Planning: Advising on tax strategies to minimise tax liabilities and take advantage of tax benefits.
Communication: Excellent communication skills for explaining complex financial concepts to non-financial stakeholders.
Spreadsheet Software: Microsoft Excel, Google Sheets.
Asset Management
- Focus: Managing investments on behalf of clients.
- Applications: Portfolio management, asset allocation, risk management.
- Tools: Portfolio analysis software, financial ratios, performance metrics.
Corporate Finance
- Focus: Managing a company’s financial activities.
- Applications: Capital budgeting, financial forecasting, mergers and acquisitions.
- Tools: Discounted cash flow analysis, financial modelling, capital asset pricing model (CAPM).
Audit and Assurance
Cost Analysis: Analysing costs associated with business activities to identify areas for cost savings and efficiency improvements. Cost Reporting: Preparing cost reports that help management understand the true cost of business operations.
Financial Planning
- Focus: Helping individuals and businesses plan their financial futures.
- Applications: Budgeting, retirement planning, tax planning.
- Tools: Budgeting software, retirement calculators, financial planning tools.
Retail Banking
- Focus: Providing banking services to individuals and small businesses.
- Applications: Personal loans, mortgages, savings accounts.
- Tools: Customer relationship management (CRM) systems, loan origination software.