Best FP&A Certifications: Further Your Career in Financial Planning and Analysis
There are many successful careers that a person can have in finance. One area of focus in which a finance professional can build a career is financial planning and analysis, otherwise known as FP&A.
What is Financial Planning and Analysis?
Financial planning and analysis, or FP&A, is a series of finance-driven activities that certain finance professionals take part in to help a company make good business decisions and maintain financial health.
Essentially, FP&A professionals collect, prepare, and analyze various forms of financial data from a business so that they can create data-driven reports that forecast the business decisions that will bring the company the most long-term financial success.
The FP&A Process
To correctly predict future business decisions that a company should make, FP&A professionals must go through a specific process of finance-driven activities. This FP&A process includes the following series of activities:
1. Data Collection, Consolidation, and Verification
In this first step in the FP&A process, financial planning and analysis professionals collect financial and operational data from accounting management software, particularly enterprise resource planning (ERP) accounting management software systems. In this step in the FP&A process, financial planning and analysis professionals also collect data from
data warehouses and other business solutions. FP&A professionals also collect broader demographic, economic, and market data at this time.
2. Planning and Forecasting
In this step in the FP&A process, FP&A analysts use all the previously collected data to create financial reports. These financial reports forecast, or predict, how a business will perform in the future. These reports also determine whether or not a business is currently on the path to financial success.
The financial forecasts that FP&A professionals create at this time include sales forecasts, cash flow projections, and more. FP&A analysts also use the financial forecast reports they create to test out different scenarios and prove what the next best course of action should be for a business.
3. Budgeting
In the budgeting step of the FP&A process, financial planning and analysis professionals estimate the amount of money they will need to execute the strategies they previously determined would bring them financial success. At this time, finance planning and analysis professionals allocate a budget to each department within a company.
FP&A professionals also create a master budget at this time for the entire company that they are working for. Many businesses keep continuous budgets that are always updated with rolling forecasts and projections.
4. Performance Monitoring and Analytics
At this time, finance planning and analysis teams analyze a company’s financial data to continuously monitor its performance. The financial data that FP&A teams analyze at this time include sales data, expenses data, profit data, working capital data, and data on the company’s cash flow and other KPIs.
Finance planning and analysis teams then use the information they learned from all this data to answer ad hoc queries and create a “data story” that helps the business’s decision-makers understand what course of action they should take.
How Do You Become an FP&A Professional?
To become a finance planning and analysis professional, you must first receive a bachelor’s degree in a finance or business-related subject area. Examples of such subject areas include finance, business, economics, accounting, statistics, etc. While not necessarily required, some FP&A professionals even get master’s degrees in such subject areas. For example, it’s not uncommon for FP&A professionals to have a master’s in business administration (MBA).
Even after graduating with a bachelor’s or master’s degree, many FP&A professionals go on to get different FP&A certifications. Once prospective FP&A professionals receive the education their careers require, they must receive real work experience in the finance or accounting industry before obtaining a lucrative FP&A job.
Common FP&A Job Titles
There are various different job positions that you can obtain as an FP&A professional. Some of the most common job titles of people who work in financial planning and analysis include the following:
Corporate Financial Analysts/FP&A Analysts
Corporate financial analysts analyze financial data and use financial models to create financial reports that predict a business’s future financial health. They also use the financial reports that they create to recommend future actions to a company.
In addition, corporate financial analysts also track a business’s revenue and gross margins. They also establish policies and procedures that guide cost analyses.
FP&A Managers
FP&A managers work with a company’s leadership team to create short and long-term financial plans. They also analyze financial and operational results and evaluate a business’s previous budgets to help them create future budgets and forecasts.
Furthermore, FP&A managers analyze data and create models so that they can project a company’s long-term growth and make recommendations to senior management that will lead to revenue generation, cost reduction, and more efficient operations.
Director or Vice President of FP&A
The Director or Vice President of FP&A owns the process for scenario planning and preparing financial statements and financial models. They also take the lead on existing management reporting, ad hoc financial modeling, and reporting for special projects.
They also define the processes for monthly, quarterly, and annual financial budgeting, forecasting, and long-range planning. Furthermore, the Director or VP of FP&A analyzes financial data so that they can make recommendations to senior management.
What are FP&A Certifications?
FP&A certifications are educational programs that teach upcoming financial planning and analysis professionals information and techniques on how to conduct data collection, planning and forecasting, budgeting, and performance monitoring.
Financial planning and analysis professionals should use FP&A certification programs to help further their FP&A skills so that they can advance in their careers. There are numerous different types of FP&A certification programs.
Some of the Top Certifications for FP&A Professionals
As previously mentioned, there are numerous different types of FP&A certification programs. Some of the top certification programs and online places where you can take them are outlined below:
Chartered Financial Analyst (CFA) Certification Program
The Chartered Financial Analyst (CFA) certification program is one of the top distinctions in the financial world. This is because the CFA certification program provides its participants with the knowledge and skills they need to successfully advance in investment analysis and management.
People who enter the CFA certification program typically have education and work experience in either finance, accounting, economics, or business. The CFA certification program ends in a three-part exam that tests its takers on the fundamentals of investment tools, valuing assets, and financial analysis.
Certified Corporate Financial Planning and Analysis Professional (FPAC) Certification
The Certified Corporate FP&A Professional (FPAC) certification program helps people establish a core set of FP&A skills. Some of these FP&A skills include scenario planning, modeling, and communicating financial data and information to business leaders.
CFI’s Certified Financial Modeling & Valuation Analyst (FMVA) Certification
The Financial Modeling & Valuation Analyst (FMVA) certification program teaches its participants everything they need to know about advanced financial modeling, budgeting, and forecasting. The FMVA certification also helps give its participants an overall competency in accounting and finance. It does this through a hands-on curriculum and real-world applications.
Other skills that the FMVA certification program teaches its participants include Excel, valuation, presentation skills, and strategy. The hands-on curriculum and real-world applications of the FMVA certification program here at CFI help prepare its members for careers in investment banking, private equity, M&A, business valuation, and FP&A.
Certificate of Corporate Finance
The Certificate of Corporate Finance from the New York Institute of Finance teaches its participants about financial statement analysis, forecasting, management accounting, corporate credit analysis, corporate finance, business valuation, project valuation, and mergers and acquisitions. One provider of this certification course is the New York Institute of Finance.
Benefits of Completing FP&A Certifications
While taking an FP&A certification program takes time and commitment, the myriad of ways that it can improve your career and life make it worth it. Some of the key benefits of taking FP&A certifications are described below.
Builds Upon Your FP&A Knowledge and Skills
The FP&A certification programs teach financial planning and analysis professionals valuable information and skills that will help them improve at their jobs. In fact, nearly all of the FP&A certification programs teach information and techniques about one or more of the core steps in the FP&A process.
Therefore, you can rest assured that you will use the skills that you learn in your FP&A certification program at work. If anything, the financial planning and analysis skills that the FP&A certifications teach are likely just what you need to get promoted and take your career to the next level.
Makes You a Better Communicator
On top of helping you become more of an expert in your field, taking FP&A certifications will also make you a better communicator. This is because you will be compelled to communicate and work with the other financial planning and analysis professionals in the certification programs.
Helps You Stand Out in the Field
Like most areas of work, the field of financial planning and analysis is competitive. Luckily, any education and skills you gain from an FP&A certification program will give you an edge over your competition. This is especially true when applying for jobs or competing for a promotion.
Provides Evidence of Your FP&A Knowledge
It’s one thing to be knowledgeable about finance planning and analysis, it’s another thing to be able to prove that knowledge to others. To quiet any doubts that your boss, co-workers, or anyone else has about your FP&A knowledge and skills, get one or more of the FP&A certifications.
Demonstrates Your Passion for the FP&A Field of Work
People often expect professional leaders to be passionate about what they do. So, if you want to take on a leadership position at work and take your FP&A career to the next level, demonstrate your passion for the field by completing some FP&A certifications.
Provides Opportunity for Salary Increase
One major benefit of completing FP&A certifications is that doing so can prove your increasing value as an FP&A employee. As a result, completing FP&A certifications can help you get a salary increase.
Provide Networking Opportunities
While in an FP&A certification program, you will get the opportunity to engage with other financial planning and analysis professionals. Therefore, you will get the opportunity to network and make more professional connections that may benefit you later in your career.
Keeps You Up to Date with Industry Changes
Advances in the field of FP&A are being made every day. Therefore, there is always something new that finance planning and analysis professionals can learn. To help you stay up-to-date with any changes in the FP&A industry, enroll in some FP&A certification programs.
Can Help Cover Gaps in Education and Job Training
Sometimes, even after you receive an academic education in accounting, finance, or business and get some work experience in the field, there are still things related to financial planning and analysis that you don’t know. To help cover those gaps in your education and job training, take the necessary FP&A certification programs.
Builds Self-Confidence in FP&A Knowledge and Skills
If you don’t believe in your own knowledge and skills, no one else will. So, if you feel any sort of insecurity about your knowledge and skills as an FP&A professional, do yourself a favor and increase your self-confidence by completing some FP&A certifications.
Choosing the Right Certifications for You
Completing any sort of certification takes time, money, and commitment. That’s why it’s important to spend your resources on the FP&A certifications that you need most. To do this, make sure that you know what the curriculum of the certification course that you’re considering consists of before enrolling in the program. To further make sure that you choose the right FP&A certifications for you, consult the following tips:
- Choose certifications that will help you achieve your individual career goals as an FP&A professional
- Pick the certifications that will give you the skills you need for your career
- Choose certifications that will help you build on the skills that you’re lacking
- Pick certifications that will teach you the skills that are most respected in your type of FP&A role
Additional Things to Consider Before Enrolling in an FP&A Certification Program
As mentioned before, completing an FP&A certification program takes time, money, and commitment. In fact, time, money, and commitment are three things that you should highly consider before enrolling to get a new FP&A certification.
For example, through CFI, you can take a Certified Financial Modeling & Valuation Analyst (FMVA) certification program for as low as $41 – $70 a month, depending on the plan. While this is much more affordable than most FP&A certification programs, you should make sure that you can afford to make this monthly payment for an extended period of time prior to committing to the program.
When it comes to the time commitment of the various FP&A certification programs, it may also vary. For example, the FPAC certification program typically requires 80-plus hours of self-study, while the CFA certification program typically requires 900-plus hours of self-study.
In addition, the FPAC certification program requires you to take and pass two different parts of an exam, while the CFA certification program requires you to take and pass three different parts of an exam. With all the variations in the time that one must dedicate to different FP&A certification programs, it’s important that you make sure that you are able to dedicate yourself to an FP&A certification program before enrolling in it.
Ways to Advance in Your Career as an FP&A Without Receiving Certifications
While completing an FP&A certification is a surefire way to further your FP&A knowledge and skills and, in turn, advance in your career, it’s not the only way. Suppose you currently don’t have the time or funds to complete an FP&A certification program. In that case, you can still further your career by networking with other finance and planning professionals or even getting an experienced FP&A professional to mentor you.
Further Your Career in Financial Planning and Analysis Today
Whether you choose to enroll yourself in an FP&A certification program or you choose to build upon your FP&A knowledge and skills another way, there are always ways that you can further your financial planning and analysis career. For additional CFI certifications that you can get to further your FP&A career, click here.
To learn more, check out the following resources:
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