Chief financial officer (CFO)

The chief financial officer (CFO), the highest-ranking financial executive of an organization, is responsible for all financial operations. The chief financial officer oversees the preparation of budgets, treasury, internal auditing, forecasts, and qualitative information analysis for management decisions; provides leadership to the financial services group; and contributes to the objectives of firm. The financial function includes internal and external reporting, treasury and tax matters, capital financing; contractual relations; the development of sound financial management systems and the management of investor/Wall Street relations. Reporting to the chief financial officer are the controller and treasurer, key leaders in the financial services group. The controller is the chief accounting executive who directs internal accounting programs, including cost accounting, systems and procedures, data processing, acquisitions analysis, and financial planning. The treasurer is concerned with the receipt, custody, investment, disbursement, and protection of corporate funds and determines the ultimate cash posi- tion for the company. In smaller firms there may be an overlap of chief financial officer and controller/treasurer responsibilities. While the chief financial officer oversees the financial aspects of a business, the Chief Operating Officer (COO) oversees the company’s production of goods and services. The chief financial officer reports directly to the chief executive officer (CEO), the highestranking official of the company. Typically the chief financial officer position requires a bachelor’s degree in accounting; an MBA, CPA, or equivalent postgraduate work; and a minimum 10 years of relevant, progressive experience. The experience may include numerous acquisitions, equity investments, divestitures, and joint ventures, both domestically and internationally. Today’s CFO requires a much broader knowledge base than just accountancy. The chief financial officer job description is moving away from the super-accountant stereotype and towards someone more akin to a deputy chief executive officer. The changing global business environment has driven the trend towards diversification. In addition to being a financial manager, a chief financial officer must be a strategic thinker, communicator, and team player, and must have an understanding of information technology (IT) systems. The chief financial officer must have the ability to clearly articulate the financial and operational results and strategic plans of the organization in a manner appropriate to a variety of audiences, including employee groups, the financial community, members of the board of directors, and the corporate CEO. As a strategic planner, the chief financial officer needs to understand the interrelationships between marketing, products, and production processes as well as understand the industry (market segment) in which the business operates. The CFO’s job has become more complex and demanding, and there are few general guidelines as to what one can expect when stepping into such a position. This will depend on the company—the nature of its business and its corporate structure, management style, strategic objectives, and executive resources.