Chief Financial Officer (CFO)
The chief financial officer (CFO) may be defined as the company’s senior-most executive who must shoulder the responsibility of overseeing its financial operations. The CFO is akin to a controller or treasurer in being responsible for managing the company’s finance and accounting departments and making sure that financial reports are accurate and finished on time. In fact, for a lot of companies, the CFO has the title of treasurer. The CFO reports straight to the chief executive officer (CEO) or President and directly helps the COO (chief operating officer) with all tactical and strategic company affairs as they pertain to cost benefit analysis, budget management, acquiring new funding and forecasting requirements.
Qualifications of a Potential Chief Financial Officer
To become a CFO, the individual should have educational qualifications in finance and/or accounting and considerable experience in financial management. The chief financial officers of many large companies have an accounting background such as Certified Public Accountant (CPA) or possess an MBA or other finance qualification.
Accounting Functions Handled
The CFO is in charge of multiple accounting functions including:
- Supervising investment and taxation matters
- Seeing to it that all accounting rules are adhered to
- Credit control
- Creating financial statements and budgets
- Keeping track of expenditure and liquidity
- Coordinating fundraising and financing
- Providing up-to-date financial information to the CEO
- Diminishing financial risks such as reliance on volatile commodity prices and variable interest rates
Any company decision that involves money calls for attention from the CFO. What’s more, at the end of the day, it is the CFO’s duty to protect and enhance the company’s financial integrity. So when a company puts up a pitiable financial performance, most of the time, the chief financial officer is held responsible particularly, if he did not predict the pitiable financial state early enough to rectify it.
Frequently, the chief financial officer (CFO) is considered to be the company’s second most important person, with the first being the CEO.