Author: Jonas Akula
What does CFO do? Now, this is a golden question that many people want to know. Your business might need a CFO or Chief Financial Officer’s services if you’re going to take your business to the next level.
Trying to understand their roles and responsibilities is not going to be easy. If you pose this question to a CFO, you might end up in a long conversation, where he or she will brief what all things they do daily. While their answer might be lengthy, you can categorize the tasks they perform into a few categories.
However, you need to understand whatever might be the response of these people. You can break down their responsibilities into the following components.
A CFO of a company is responsible for presenting and reporting the financial information accurately. They need to ensure that these reports are available on time.
Understanding the company’s finances from the time of its inception is crucial and helps the CFO better fulfill their responsibility.
Stakeholders, investors, creditors, and analysts base their decisions based on these reports. CFO is held accountable for the accuracy of these reports. Hence, this is one of the critical tasks of a CFO.
Duties Related to Treasury
Apart from handling the reports, they are also responsible for presenting a company’s financial condition at the moment. They are responsible for giving direction to senior leadership and others on investing the company’s finances in getting the best results.
It means they need to understand better the risks involved and the liquidity. They not only oversee but build the capital structure of the company. CFO’s know how to best mix debt with internal and equity to bring in the best results. As a result, it is an expectation from them to find all the issues surrounding capital structure.
Forecasting and Economic Strategy
A CFO’s task is to understand how a company did in the past or present and give them the direction for the future. They need to understand the strong areas in a company that is performing well.
Thus, they can help the company see how they can leverage those areas to their advantage. For example, a CFO working in the automobile industry should indicate which car models bring maximum profit. Insights like this can help steer the company in the right direction and to find success.
These are some of the critical tasks that a CFO handles.
Outsource this Task
An article that WSJ published showed the compensation that various CFO’s were making. Most of the CFO’s charge a bomb to perform these tasks for you. It might not be easy for you to hire a CFO when you do not have much money in hand.
The best option that you have is to search for a company that offers CFO services. Many professional financial services provide this service. Take your time to find the best financial company that offers this service. By outsourcing this task to a professional company, you will significantly cut down on the costs.