Whats the word on Accounts Receivables Finance? (Career wise)

I saw some accounts receivables position at HSBC, careers in corporate finance, and then ran across another at a non-bank company.
From what I have read so far skills developed = financial analysis, business analysis, decision making. Though I am not quite sure to what extent since each place has their own procedures.

Anyone here have experience in this area or know of anyone in it?


Comments (11)

Sep 30,2016

At a bank it's probably dealing with AR factoring. Outside of a bank it could be managing the factoring process or a bunch of AR processing staff if they tried to give AR Supervisor/Manager a fancy title (yes, I actually saw what appears to be an AR Supervisor job req with that title in my 30 second google).

I don't know anyone in it so your guess is as good as mine, but your estimate of skills acquired is probably about right. Maybe some exposure to risk management but would imagine the bulk of that is done during the sales/contract negotiation process.

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Sep 30,2016
Sep 30,2016

Accounts receivable is the area of a finance function that deal with money flowing into the business.

Raising sales invoices
Credit control
At certain companies - managing invoice finance

The other side of this is 'Accounts payable' which is the area that deals wih money flowing out of the business

Processing purchase invoices
Paying purchase invoices

It's a transactional area and not considered skilled or interesting work by any means

Sep 30,2016

I'd avoid corporate AR if I were you. Your job could likely get automated. source: We recently let go of 4 "AR specialists" because their jobs were automated.

Sep 30,2016

any way to jump ship into something else after 1-2 yrs of AR?

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Sep 30,2016

From corporate AR, may be tough. But in reality, it's all about who you know and the quality of work you have done. If you are a good worker, and let your boss know you'd like to become more well rounded and gain experience in other areas of finance/accounting, then you will likely be able to.

Sep 30,2016

I would avoid AR in general. If you are in corporate finance (industry) it might be a good rotation to go through (i.e. 6 months) just to learn about it because it is an important function accounting wise. However, you don't develop really great skills there and I have known AR folks who have had a tough time getting into better roles. Plus AR tends to pay less in general as well.

There are a lot of roles in corporate accounting that are really useful to spend a marginal amount of time in (6 months to a year) but not to develop a career in. Areas that come to the top of my head are fixed asset accounting, external reporting, AR/AP, internal audit (some exceptions, GE/HON), consolidations, revenue accounting, etc..

All are useful roles and as a finance professional can be very beneficial in giving you a better understanding of financial systems and accounting for your industry. But I would be wary of of spending a lot of time in those areas. However, if you spend 3-5 years in accounting roles and 20+ years in finance roles you will probably be more well-rounded than just 25 years in finance roles.

Best roles in corporate finance in my opinion are the following (not particularly in order)

  1. Business Unit/Product Line finance roles. (FA, SFA, Manager, Controller, Product Line Controller, Division Controller, Division CFO)
  2. Manufacturing finance for mfg companies (FA, SFA, Plant Controller)
  3. Global/Corporate FP&A (FA, SFA, Manager, Senior Manager, Director, VP+)
  4. Investor relations (Analyst, Associate, Manager, Director+)
  5. Corporate Development/M&A (Analyst, Associate, Manager, Director+)
  6. Pricing (esp for airlines) (FA, SFA, Manager, Senior Manager, Director,+)
  7. Sales/Commercial Finance (FA, SFA, Manager, Senior Manager, Director,+)
  8. Shared Services Finance (FA, SFA, Manager, Senior Manager, Director,+)
  9. Cost Accounting (for manufacturing companies, critical background for business unit, mfg finance roles (FA, SFA, Manager+)

The last act is tragic, however happy all the rest of the play is; at the last a little earth is thrown upon our head, and that is the end for ever.

Sep 30,2016

How would you tier these in terms of exposure within the firm (ability to move up the food chain faster) or exit ops? In my experience I would put them in 4 groups generally. Opinion?

Tier 1- High exposure to top executives (typically promoted more quickly) and strong exit ops.

  1. Corporate Development/M&A- If M&A is a major part of the firms strategy than this is usually considered the top finance talent pool of the firm.
  2. Business Development & Strategy- Responsible for project finance, JVs, valuing potential markets etc. (These positions seem to start at manager in a lot of firms)

Tier 2- Strong exposure (Typically have the ability to move around the firm/not pigeon holed)

  1. Sales/Commercial Finance- typically are involved with lots of salesmen/topline growth, so exposure can be really strong.
  2. Global/Corporate FP&A- Usually a 50/50 mix of regular accounting and forecasting/ analysis. (Budget discussions provide strong exposure and at the higher levels you could be looped into strategy/M&A.
  3. Investor Relations- Can be a great way to get exposure to top brass at the firm, (not really viewed as a growth/revenue position) Skill set can be considered niche, but I have heard the hours and the work are awesome.
    6.. Business Unit/Product Line finance roles- tends to have a lot of accounting focus at the low level,(ie.reporting) with increased responsibility with the budget and growth at the higher levels. (Top performing units typically have there finance people promoted and spread around the firm)
  4. Pricing- Depending on the firm and industry this can be a crucial part of the performance of the firm, so exposure varies.

Tier 3- Decent exposure (exit ops tend to lean to more of the same jobs as skill sets are viewed as more niche)

  1. Shared Services Finance- Usually is a accounting role with more a internal reporting focus, the advantage to this role is that you network throughout the organization. So moving is usually an option down the road.
    9.Manufacturing finance/Cost accounting- Accounting with a touch of analysis, can be involved with inventory management and procurement, which if performing well could lead to opportunities.
  2. Technical Accounting- Heavy accounting, full of CPAs, does have some exposure to top brass, but typically seen as a back-office person with little impact on the operations. Exit ops tend to offer decent pay and work/life balance.
  3. SEC reporting group- Full of ex-auditors and CPAs, low level it is a very tedious accounting job. Higher level could lead to opportunities in BU Finance. Tough promotions on the lower end as Big4 people usually come in to fill those roles

Tier 4- Normally Pigeon holed, limited growth and exit ops

  1. Tax- Full of CPAs, work is usually tedious. Pay can be good and exit opportunities are pretty much all in the tax silo. This could be a much higher tier job if a company has unique tax structure that it relies on to function. Rarely hear of someone leaving tax though.
  2. IA- Full of ex-public accountants usually. Often viewed poorly internally with some notably exceptions (GE). Can be tough to leave group, but pay is usually fair.
  3. AR- usually full on non-college graduates and often no one higher then manger within the group, rarely ever leave group and are usually forced to switch firms to even become manager. Lower paid.
  4. AP- Pretty much the same as AR. Although, AR gets more attention usually do to its ability to maintain relationships.

This is just based on my experience, I am sure every company is different.

Best Response
Sep 30,2016

A/R is a dead end job that doesn't really prepare you for anything else and offers limited exits. I don't consider myself a snob by any means but that's probably the only corp fin role (aside from A/P) that I'd avoid. It's quite a bit of drudge work: applying payments, doing collections work, getting credit approvals, and running aging reports to show who owes what. It never lets up and there's no glory in it. Say you collected a payment on an invoice that looked as if it were going to be a write off, do you get so much as a pat on the back? It's more like why didn't you collect this sooner since it was owed?

Also, depending on how important your customers are (how much $$ they bring in), you'll be under pressure to meet your collections targets while abiding by their own internal payment terms, which may be completely contrary to your company's-so expect your bosses harassing you to collect stuff within a timeframe they KNOW your customer won't recognize. You won't win in those instances.

And have fun telling your Sales dept. that you won't extend credit to a customer who's made a huge order because of their risk profile. Prepare for salespeople going over your head, demonizing you, and raising hell to get these approvals.

Finally, those jobs are usually the first to get outsourced writ large. The pay's already terrible, and it's better to have people in developing countries who'll take the abuse without complaining.

Now I have seen people successfully transition from A/R to something more meaty, but it usually involved going to a P/T degree program and heavy internal networking/job posting. The only "good" thing I'd say about this job is that it lets you develop relationships w/ Front Office people or those w/ some influence, so if they like you and can vouch for you internally you might be able to make your way to something else. But that's more the exception than the rule. My last boss came over from A/R and she was a manager there for 10 years(!) before finding an opening.

Sep 30,2016

It's a reasonable way to get your foot in the door but as others have pointed out it is one of the least desirable finance/accounting roles. It is possible you get some "phone experience" making collection calls.

In A/P you see the money flowing out of the business which I would say is a bit more interesting, depending on the nature of the business. Many/most businesses have a broader range of input costs than final product sales eg 5 different raw materials get turned into one product.

A good tell as to the quality of the job would be whether it absolutely requires a 4 year degree or is open to an associates. Check LinkedIn of your potential boss and co-workers if you can.

These type of jobs can be extremely heavy in data entry.

I started in A/P and 3 years later am now in FP&A at a different company.

Sep 30,2016

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