Tweet

Is Your CFO REALLY a Chief Financial Officer

Guest post by: Dr. Rick Johnson

Article Overview: No offense to all those dedicated, competent, excellent performing CFO’s out there but I have to admit that I run into a number of individuals in business that hold the respectable title of CFO (Chief Financial Officer) that shouldn’t be the Chief of anything. Oh, some of these CFO impersonators do a good job as an accountant and some may even qualify as a Controller. But, there are some that just shouldn’t hold the title of Chief Financial Officer. “The chief financial officer (CFO) is a corporate officer primarily responsible for managing the financial risks of the corporation. This officer is also responsible for financial planning and record-keeping, as well as financial reporting to higher management. The CFO is also responsible for analysis of data”. So…… ask yourself; is your CFO really a Chief Financial Officer.

Is Your CFO REALLY a Chief Financial Officer





No offense to all those dedicated, competent, excellent performing CFO's out there but I have to admit that I run into a number of individuals in business that hold the respectable title of CFO (Chief Financial Officer) that shouldn't be the Chief of anything. Oh, some of these CFO impersonators do a good job as an accountant and some may even qualify as a Controller. But, there are some that just shouldn't hold the title of Chief Financial Officer.

"The chief financial officer (CFO) is a corporate officer primarily responsible for managing the financial risks of the corporation. This officer is also responsible for financial planning and record-keeping, as well as financial reporting to higher management. The CFO is also responsible for analysis of data".

So...... ask yourself; is your CFO really a Chief Financial Officer or did you simply give them that title due to tenure, compassion or because ty are a family member?

An effective CFO starts by asking the question of all management personnel --- What needs do you have, and how can I help?'"

Real CFOs

Real CFOs today are structuring and negotiating mergers, working with division managers to cut costs, stepping in for the CEO to talk to investors and boards of directors as well as coordinating all the components of strategic planning. Being a CFO is not just about finances. And yet, you must be careful not to burden the CFO with responsibilities that they are not qualified to handle. A simple example might be putting them over information technology with no practical experience in that field to avoid hiring an IT specialist.

The CFO bears responsibility for the results of core finance activities and provides appropriate analysis. A Real CFO is both a navigator and an adviser to business managers throughout the organization. This person must be ready and willing to manage the administrative side of the business, and the strategic requirements involved in measuring and validating successful results. A key responsibility includes fighting for investments in the growth of the business. The CFO must instill confidence with all of the stakeholders focusing on particular roles and activities both internally and externally.

A Real CFO has the ability to build consensus, to inspire confidence, and to

be a navigator for the CEO and make decisions authoritatively. They must be

ready and willing to provide an opinion when and where necessary, fight for its implementation and be humble enough to back off and support alternative ideas, as appropriate.

The Relationship with the CEO

How chummy should the chief executive get with the CFO? Some experts warn against developing too close a relationship with any top subordinate, because you have to make judgments that are based on what's in the best interest of the company. However, relationships are important and being able to get together and discuss critical issues informally can only strengthen the executive team.

The best situation for any CEO and CFO is a close relationship, not as equals, but the fewer formalities the better. The ability to talk on the phone over a weekend should not be considered an imposition on personal time.

Much greater demands on businesses to perform makes a company's accounting and finance functions, led by the chief financial officer play a broader role in guiding decisions across the business in order to maximize shareholder value. In addition to broadening this role, finance departments are making strategic investments in IT solutions that automated and standardize critical processes within their own department. These investments not only help decrease costs and cycle times, but pay additional dividends in the form of strengthened compliance and improved financial returns.

So..... If your CFO demonstrates not only leadership but also integrity and honesty, which objectively balances the competing needs of internal staff, the board of directors, investors, other stakeholders and maintains integrity in the face of investor or board expectations for results then you have an excellent Chief Financial Officer.

Related Articles
  Why Is the Chief People Officer Missing from the C-Suite?
  What does a CEO do What is their job discription
  100 Ways to Succeed #39
  Buzzword Bingo and Acronym Update V2.011
  How Employees Are Your Greatest Asset in Building Loyal Customers
  Do You Have a Chief Serving Officer?
  Analyst says we shouldn’t expect revamped Mac desktops anytime soon—but I beg to differ
  Youth and Entrepreneurship: Part 1
  JetBlue Valentine’s Day crisis—The case for Chief Reputation Officer (CRO).
  Your Career Plan - Be The CEO Of Your Own Career!
  EVERY BUSINESS NEEDS A CEO!
  Michael Moore, Capitalism, and Dead Peasants Insurance
  Papa Bello to acquire Indian Concept, to franchise eventually
  Title Inflation Emerges With A Vengeance
  What Does a CEO Do?
  Giving Back
  Do you Suffer from Sand Castle Management? Take this Litmus test.
  There’s a slow, slow train comin’ up around the bend: Epilog for the Ariba Interviews
  Do you manage your Finances like GM or Exxon?
  Successful Business Plans

Article Tags: chief financial officer, corporate officer, financial reporting, leadership



Related Forum Posts
Future Financial Corporation - I've never heard of Future Financial Corporation is this a new company?
Job title depends on job type - I knew a small press publisher with a sense of humor.... she called herself "Chief cook and bottle washer." I'd say calling yourself CEO would give your clients illusions of grandeur about your business, if it's not a large one. President or Director would work.
canada resources - I used to have a connection to a franchise consultant in Canada at "Franchise Officer" in Toronto. I wish I could remember his name ( but I can check my files at the office tomorrow). Anyway, he had a lot of connections to banks in Canada. He may know of them and may be able to offer some feedback. If you are looking for a business loan, Canada has similar business loan programs to that of the USA's Small Business Administration (SBA). I think its SLBS in Cananda, and I probably have the list of it's lenders in my office also. Do you think either can be helpful? If so, I can get back to you with this information tomorrow. Let me know!
Any experience with McManus UK Ltd.? - Did anybody already deal with any of the McManus UK Ltd offshore entities? I do have a program, but not enough cash. I have been advised that they can fund investors with access to Private Placement Programs but they don’t want to joint venture with me. They want a fee for the service. This is why I want to find out if anybody has had first hand experience with this group? Patrick Ohara, Financial Consultant
Re: LEADERS - Nice post, i like the Doers and the listeners comments from my handbook 8.5 HOW MUCH DO YOU KNOW ABOUT LEADERSHIP? Planning Problem Solving Vision Innovation Leadership Emotional Intelligence Delegation Communication Self-Development Relationship Building Commercial Financial skills Personal Energy Ethics Transparency Even there I see that we are missing "PASSION"


Share this article with your friends. Fund someone's dream.

Leave a comment below or share on the left and you'll help support entrepreneurs in Africa through our partnership with Kiva. Over $50,000 raised and counting - Please keep sharing! Learn more.

Newsletter

Get advice & tips from famous business
owners, new articles by entrepreneur
experts, my latest website updates, &
special sneak peaks at what's to come!

Name:
Email:

Popular Articles

Selling What Sizzles vs. Delivering Real Value

The Digital Diet by Daniel Sieberg

Promoting your company and self with verve

Suggestions

Email us your ideas on how to make our
website more valuable! Thank you Sharon
from Toronto Salsa Lessons / Classes for
your suggestions to make the newsletter
look like the website and profile younger
entrepreneurs like Jennifer Lopez.