Finance directors have broad authority in city government. As the chief bookkeeper, a finance director promotes transparency, efficiency and accountability. While finance directors may only have a basic understanding of the different city departments, their financial expertise is invaluable in ensuring citizens get the most out of their tax money and in proving so. Numbers go further than rhetoric in proving that tax money is collected and spent according to the public’s best interest.
Much like city attorneys, finance directors are involved in the work of all other city departments. Since finance departments touch all others, the finance director usually reports to the city manager rather than an assistant city manager like other department heads. In every action, city staffers need to make sure they are doing things right from legal and financial perspectives.
If the public works director wants to hire an additional 20 staff to collect garbage, the finance director helps write the cost estimate and justification. If the parks and recreation director wants to raise the fee to reserve a soccer field, the finance director helps with the revenue projection.
By necessarily getting into other departments’ business, finance directors quickly achieve a deep knowledge of all city functions. This makes veteran finance directors suitable for promotion to city manager positions.
The Selection Process:
Finance directors are selected through the normal government hiring process. Because finance directors have easy access to cash and broad authority in the city’s financial information system, cities usually conduct extensive background and reference checks on finalists. It only makes sense that the department head most responsible for championing sound financial controls is proven trustworthy.
The Education and Experience You'll Need:
Finance directors must have formal education in accounting and finance. At a minimum, they must have bachelor’s degrees in a relevant field. Many have master’s degrees in accounting and are certified public accountants.
Candidates for finance director positions should have significant accounting experience, preferably in city government. They should also have several years of management experience.
What You'll Do:
Finance directors supervise finance department staff. In midsize and large cities, one or more layers of management are placed under the finance director’s line of supervision. Finance department management duties are often divided by function such as budget, revenue collection, claims processing, payroll and financial reporting. Staff communicate with one another because all their work eventually rolls up to the city’s annual financial report and other routine and ad-hoc reports produced throughout the year.
The finance director is ultimately responsible for maintaining the city’s financial data. Not only do the numbers need to be accurate every time, they also need to be understandable. When the finance department produces reports, they must be explained. The finance director makes sure that explanatory text, tables, charts and footnotes will make sense to people without financial background. Presentations to the city council must be clear and concise.
Governments must abide by generally accepted accounting principles set forth by the Governmental Accounting Standards Board. Finance directors ensure that their cities follow GASB’s standards. Finance department policies help the city do this. City employees who handle cash or have access to the financial information system are responsible for following these policies. The finance department trains these employees on relevant policy. Finance department staff double-check figures to monitor for policy and process compliance.
The city manager and finance director work side-by-side on large financial projects like bond proposals and external audits. The finance director prepares the city manager for presentations and advises him or her on key decisions.
Larger cities have in-house auditors that double-check the finance department’s work and explore operational issues in other city departments. For smaller cities, the finance director is the liaison for external auditors. The finance director gathers documentation and answers auditors’ questions during audit fieldwork. Once the external auditors issue a draft report, the finance director coordinates management responses to issues raised. The finance director makes sure that any actions the city and the auditors agree to are completed.
What You'll Earn:
Like with city managers, assistant city managers and other department heads, a finance director’s salary depends on the size of the city and the number of people under the director’s line of supervision. Because of their organization-wide authority, many cities pay their finance directors better than other department heads.