by Glenn Cheney
Montvale, N.J. -- As part of the Institute of Management Accountants’ newly adopted strategy of branding the term “managerial financial professional,” interim executive director Paul A. Sharman said that the group’s new direction would be to stake out a professional territory for the corporate accountant.
“We are going to build a community that recognizes the importance of managerial finance professionals,” Sharman said. “MFPs already have a community. The IMA has 45,000 members who are not certified management accountants. You have to ask yourself why they have that kind of commitment. I think it’s because they believe that managerial finance is important. We haven’t capitalized on that enough. We’re going to take that and build on it.”
Sharman, an international consultant and chartered management accountant who joined the IMA in November, was named interim director following the recent departure of president and chief executive David T. Schweitz, who, after three years with the 67,000-member group, resigned over a difference in philosophy and direction.
Schweitz could not be reached for comment, but IMA chair Kim Wallin, president of D.K. Wallin Ltd., said that the parting was amicable.
“Dave has done a great job coming in here and making the IMA stable and doing some hard cost-cutting that needed to be done. And he got the CMA review course on track,” Wallin said. “But the executive committee wanted more intensity and a new direction.”
As part of the IMA’s new strategy, the professional organization will work to distinguish management accountants from auditors.
Sharman said that the institute is reacting to the new demands of the Sarbanes-Oxley Act. A response to recent corporate scandals, the act puts more responsibility on management and requires more stringent accounting and reporting.
“It comes down to where control resides,” Sharman said of the effort to make management more responsible. “You cannot impose control from outside a company. The procedures, processes, methodologies and practices inside an organization are what cause the organization to be in control. The practitioners, therefore, have to have standards and methodologies to apply. We see that as our domain,” he emphasized.
That domain, Sharman said, means that the potential membership of the IMA — which currently numbers about 67,000 and at one time exceeded 90,000 — includes scores of “disenfranchised” accountants who work for companies and other organizations but are not public accountants.
An early indication of the IMA’s new focus is an agreement in principle with the American Association of Accountants — an organization composed principally of academics that concentrates on accounting research and education. The IMA has asked the association to propose a research project to be conducted with IMA funding.
AAA member Kip Krumwiede, assistant professor of accountancy at Boise State University, said that he intends to propose a project to research German cost accounting.
“We are researchers; that’s a big part of our job, and I think we can help fill the need for research that the IMA has and help them meet their goals,” Krumwiede said.
Sharman said that he could not establish how much the IMA is intending to invest in research. The amount depends on the proposals, which could come from individuals and organizations other than the AAA.
The IMA Executive Committee has decided to launch the term MFP as a kind of trial balloon to see whether the business community sees it as more descriptive of a profession populated by accountants who are not CPAs.
“When I hear MFP, I think MVP — most valuable player, and that’s what the MFP really is,” IMA chair Kim Wallin commented. She sees MFPs playing an increasingly important role in management decisions.
Wallin said that the institute is going to enhance its two certification designations, the Certified Management Accountant and the Certified Financial Manager. The institute wants to ensure that professionals seeking certification are being tested on skill sets that are currently used in business. The importance of a commitment to the IMA code of ethics will be reinforced. Continuing professional education courses will be more substantive and demanding.
The institute is also looking at the viability of standards in management accounting.
“I think the opportunity to establish legalistic standards is available through risk management,” Sharman said. “It’s really evident that the management of processes, and the expectations of performance of people who are in the context of those processes, has to be characterized. We have to establish what we mean by functioning properly and bounds of control. We need our members to understand that. Otherwise, we’re going to have other people trying to glom onto this, [without] actually doing the work. It is the MFPs who do the work, so we have to establish expectations for them.”
