If you are interested in reaching the pinnacle of your career in finance then there are a few things you should know about the chief financial officer (CFO). The CFO is the senior officer responsible for running the financial activities of a corporation. The CFO’s obligations involve trailing cash movement and financial arrangement as well as studying the company’s financial powers and weaknesses and recommending helpful solutions.
The CFO is like a treasurer. Why? Well, because he is in charge of handling the finance and accounting sectors and also for making sure that the company’s financial information is correct and completed in a timely fashion. At the very epicentre of its functions, the job description requires the chief financial officer to be liable for all the financial, skill management, and managerial actions. This comprises the growth and development of effective financial tactics for the company, as well as managing these strategies.
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As the CFO, you are answerable to the company’s Board for all accounting and financial matters. You have to create company-wide aims, strategies, measures, methods, agendas, and carry them out to guarantee the company’s continuous detailed financial structure. Certainly, the CFO duties should be defined in your Job Description, am I right? If not, let’s take a look at some of the things you have to do as a Chief Executive Officer.
As the Chief Financial Officer, your job is to govern the cash-flow throughout the establishment, recognize the sources and monitors the spending of cash, secures valuable documents. You will accept, keep, and distribute the company’s cash.
Aside from being in charge of cash flow, another aspect part of your CFO duties is to know all of the company’s liabilities which is one of the most important parts of the job. A standard company has many contracts, legal & tax obligations, and contingencies. There is no better person to look out for these liabilities than the CFO.
In a small organisation, the CFO is the manager of Secretarial, Finance, Human Resource, and information technology. In bigger companies, the CFO duties may just consist of the Accounting and Finance roles. But the bottom line is that the CFO helps the company’s accounting and financial roles.
As the CFO, you have to create and sustain lines of communication with several investment bankers, financial analysts, and shareholders as well as the President.
As CFO, you will create and complete programs for the providing of capital necessary for the company, including discussing the obtaining of debt and equity capital and sustaining the necessary financial activities.
As the CFO, you must sanction all agreements relating to financial duties, such as contracts for resources, information technology assets, and services.
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Chief financial officers usually work in comfortable offices because they spend hours on the computer. Meetings should be carried out in conference rooms which should be comfortable and temperature controlled. They get support from office assistance personnel for any tasks they might need to be accomplished.
Chief financial officers naturally work extended hours, primarily during vital times such as the close of the financial year or each quarter. These crucial periods can be hectic a lot of time.
1. Leadership
This is the pinnacle of the financial ladder so it demands a lot of responsibility and a lot of people looking up to you for guidance. A firm and self-reliant CFO is able to move the business forward with good strategies that will have an impact on the employees. Therefore, you will have to be a good decision maker and leader. Rather than just counseling the Chief Executive Officer, the Chief Financial Officer should be considered as an equal partner and important consultant on information and action planning. The capability of completely influencing others and push boundaries is important in filling this position.
2. Experience
An extensive and diverse standpoint on the effect of commercial instructions, client anticipations and market powers will guarantee a good information base from which to deduce financial insight. Complete understanding in an array of tasks and roles can add perspective and create an appreciation of investor. This can also be assisted by a wide classroom education in business, for example, a blend of the CA qualification and an MBA degree.
3. Communication
Communication is well appreciated in the business world. Skills in communication, presentation, and workplace associations encourage reliability in the firm. Good communication skills are necessary for almost all financial operatives and they are important in explaining difficult tasks so that your team can understand and carry out the order as instructed. A solid level of acceptance by your subordinates, respect, and self-confidence coupled with the reputation you have made for yourself will make it easier to stand by the tough decision you have made under pressure.
4. Adaptability
A chief financial officer must be ready to go with the trend and adapt to new innovations that are coming out every day. The computer revolution is creating an interruption in all sectors and as a skilled chief financial officer, he/she must be ready to go with the flow and respond to these alterations. He should be informed and know about possible threats to his standing as the chief financial officer. An organisation that wants to go with the trends and possible stay above the competition will look for a candidate that has these skills. He should be able to understand big data and give fast analysis, both in finance and other matters outside his jurisdiction. A chief financial officer should be committed to developing himself professionally. He should be willing to give room for improvement and innovative practices in his quest to lead his sector and the entire business forward. Equally, encouraging the hiring of new talents and instilling that passion in them.
5. Mentoring
The chief financial officer has a lot of responsibility and mentorship should be a good asset when boosting your reputation. Mentoring and career coaching will not only boost your reputation but will also improve your team’s performance as they grow under you.
Because CFOs are existing in so many industries and organisations, the education requirements differ generally. The common level of education needed to be a CFO is a bachelor’s degree, as well as a significant amount of work experience in the finance field. Another common requirement for CFOs is a master’s degree in business administration.
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Like any other executive position, it takes years of experience to achieve. Well if you are lucky, it should take you about 10 to 15 years in the finance-related field to be considered for that position. They often seek out people with a reasonable success rate and also with years of experience.
The average salary of a CFO is about $313,343 per annual in 2017. Although, apart from the salary and bonuses, CFOs should receive benefits as well such as Social Security, disability, healthcare, pension as well as time off. The worth of these added benefits for the regular CFO is about 20% of his or her total payment.
Obviously, the job outlook for anyone looking-in is very favourable. Since they don’t actually fall into a single industry, there aren’t any employment predictions for the position. On the other hand, since the position is very important for any establishment, it appears like the market will only experience an influx of CFO Job openings. Moreover, there are more companies that are being created every day. And more, the large CFO salary and other bonuses make the CFO position very desirable.
If you’re looking for your next CFO role, visit the Accountancy Age jobs site.