When we talk about core competencies, that usually refers to a company’s ability to create a competitive advantage that makes their business a cut above the rest.
In accounting, there are several core competencies that every company must have. In today’s article, I will talk about some of them so that you will be aware of. Perhaps, you want to get some competent accounting services in Malaysia while you’re at it.
When it comes to accounting, there are two different types that you need to be aware of because they both have different core competencies.
The first one is Financial Accounting and it is responsible for examining and reviewing a company’s accounting information. The financial accountant will then be able to assess its validity and accuracy before they hand it over to the business owner for review.
The core competencies in Financial accounting typically relates to the understanding of national accounting principles.
Management Accounting, on the other hand, looks at all of the internal business functions and the abled body will then gather and record all financial transactions for the management to review.
The core competencies in management accounting are typically found in forecasting, cost allocation, and budgeting processes, among many others.
Why Core Competencies Are Needed
The core competencies in accounting are needed because it helps ensure company owners, managers, and directors that they will have a proper understanding of the operational flow and performance of their organization.
A company that has set core competencies requires years of time and experience and will not be easily replicated by other companies. That is why organizations that have established competencies are usually the preferred options as opposed to those budding companies.
Among the many organizations that pertain to accounting, the American Institute of Certified Public Accountants or AICPA is an organization that gives licenses to qualified accountants that have the know-how of the different core competencies required in the field.
The said organization writes three accounting core competencies: business perspective, functional, and personal. Business perspective competencies will require accountants to have a thorough understanding of the various business situations and topics.
Accountants with functional competencies are those that have the amazing ability to assess and do (and therefore, complete) all accounting processes that are required of them.
Finally, personal competencies talk about a person’s ability to perform their functions in an organizational and business environment using their own technical skills.
Learning These Things
An easy way to get all of the accounting tasks handled is usually for a business owner to just hire a qualified and certified public accountant or CPA. However, such services will be too much for small business owners to get.
Fortunately, you are not limited to doing just that. With the power of the internet, you can use it to search for accounting programs that you can find online and learn from that. All you really have to have is the patience and perseverance to understand accounting principles and the core competencies that the job usually entails.