home  news  study zone  career advice  pq awards  free mag  advertise  contact  nq mag
PQ magazine is for part qualified accountants.

Read the latest web issue here – if you like what you see sign up today

Careers


Rising to the challenge

Accountants working in the public sector face a unique set of challenges. So how are they dealing with them?

November 2016

For finance officers working in the public sector, ‘business as usual’ just won’t cut it nowadays. Public organisations, be they health services, local government, police and fire services, have always faced a unique set of financial challenges, compared with those in private sector businesses – think funding frameworks, taxpayer obligations, etc – but in today’s cash-strapped public sector, the role is evolving into one that would have been barely recognisable just a few years ago.
Today’s CFOs must certainly retain all the technical expertise that has traditionally defined the role, but now they need to also deal with increasingly complex partnerships, widespread reform and new patterns of funding. They must be the drivers for investment and strategic transformation, all the while ensuring that the budget is balanced in a given year and adequate resources are created to build for the future.
Local government, for example, has had to weather the storms of funding cuts during almost a decade of austerity, while also managing reforms for greater fiscal autonomy – and the sector has responded not only by working to maximise savings and efficiencies, but by seeking new and entrepreneurial ways to boost revenue. There are now numerous examples of partnerships established between councils and commercial organisations, and a growing number where councils have set up independent, autonomous profit-making companies themselves.
Recognising that a large number of its low-income residents were paying high prices for pre-pay gas and electricity, Bristol City Council recently established Bristol Energy, which it says will be a social enterprise, providing fair prices to its customers.
To develop a workable business model and bring Bristol Energy to the market, the council put forward significant investment and brought in a wide range of external expertise. The investment in the company is based upon Market Economy Investor Principles (MEIP), which follows along similar lines to those used by private equity investors, and includes possible return rates from the investment at above 20%.
This emerging drive for business growth and public sector entrepreneurialism comes with its own set of challenges, particularly relating to risk and investment. Organisations must analyse their own business structure to determine what can and should be outsourced. They need to develop the appropriate level of monitoring and benchmarking to ensure there is value for money. And within the contracts, there needs to be clear governance arrangements to ensure conflicts of interest do not arise.
In order to meet the challenges, CFOs cannot rely on financial acumen alone, they must be innovators, with leadership drive and solid people skills. They must possess the ability to undertake a range of roles, depending upon the context and demands of each situation. And they must be instrumental in enabling growth, taking calculated risks and delivering change.
Looking at what makes a truly standout finance officer they must be able to look beyond merely having a firm grip on the money, to seeing the larger picture. They must be able to translate vision into action; manage their time and the ambiguities of the role; respect other perspectives and develop strengths in others; be clear communicators, both in expectations and decisions; and they must adapt to circumstance, while balancing detail with strategic perspectives.
There must also be a clear link between how funds are being spent and excellence in service delivery. This involves embracing complexities, both in their organisation and in how their organisation interacts with others and society at large.
All of this means that as we look to the future, public sector finances must be a hotbed of new skills and experiences and those entering the field, those future leaders, must possess a broad range of abilities alongside traditional technical knowhow.
And perhaps the greatest skill will not be one particular attribute, but the ability to balance the skills in appropriate measures and at the right time.
• Thanks to CIPFA for this article

[«all Career Advice]
preload preload preload preload
Subscribe to RSS