أنشئ حسابًا أو سجّل الدخول للانضمام إلى مجتمعك المهني.
Actually its good that the word "Understand" was mentioned in the question because the project manager must be able to get the quality of predictions and estimations given to him.
He should sometimes even know enough about finance and accounting, to be able to recheck the estimations and financial plans and to influence his employees in a way that they know "the boss always understands the difference of a good job and a bad one".
He also is always responsible for the quality of the out come and as for someone who is known by the Main Contractor's Board, he should understand whats going on in financial department.
If PM definition is to deliver the best solution in due time, quality and within budget constraints, then PM does not need to be Financial “Guru”. To track his project, he must define clearly relevant KPI’s with stakeholders so he can analyze, take actions and report; his other important tasks being, to understand (not master J) the customer business / processes / challenges, so to coordinate efficiently his Teams to deliver project goals. His personal expertise’s such as “Finance” or “SI” or… , should not overshadow the fact that a PM is first of all a Manager leading different teams skill? Have a good day
It is important for the PM to understand finance and accounting as PM is accountable for maintaining profitability for a project and optimizing operation costs. Similarly he is also accountable for all risks. Hence finance and accounting knowledge will help the PM manage sources of funds, to improve cash flows and reduce costs in project. It will also enable him to equip with account operations while dealing with vendors and internal Account Payment Departments.
I would say that understanding of the finance and accounting statements, which includes: Balance Sheet, Income statement, and statement of Cash flow is a big advantage skills for the project manager in order to analyze and report his project finance health and to show/audit how the PM spend the project funds.
