Why are CFO Services Important?
Often, companies commit small blunders in their pursuit of wanting to handle everything, starting from planning to taking over the finance part. This blunder can vanish if the mastermind of the company considers CFO Services and if, in case, you want your hands on the best services that are away from your reach. Then worry not! A virtual CFO is there for your rescue. Now, when it comes to virtual CFO, you might think it is less effective than offline CFO Services; however, contrary to that belief. Whether virtual or remote, CFO Services will always remain CFO Services.
Who is a CFO?
CFO refers to the Chief Financial Officer, a senior executive who is holistically responsible for the management of the financial undertakings of the company. He/She is a topmost executive and is the financial controller, who takes it into his hands to solve everything relating to cash flow, financial planning, and taxation issues. Often considered to have the highest financial position and the third-highest position in the company, the CFO is vital in deciding the company’s strategic initiatives.
Are the CEO and CFO similar?
No, the CEO and CFO are not similar, as CFOs are expected to work diligently with a company’s other senior executives, including the CEO. Executives belonging to the CFO are referred to as the C-Suite of the company and represent themselves as the highest decision maker, thus marking all the boxes of other executives in the company. Although, the CFO is typically in a subordinate position to that of the CEO in the hierarchical structure of the corporate world. CFOs generally are the most efficient in terms of decision-making within the department, considering financial interactions in a particular firm.
Responsibilities of a CFO
Controllership duties
Controllership duties hold the CFO responsible for presenting and reporting accurate and timely financial information based on the historical shreds of evidence presented by the company. All stakeholders in the company, including shareholders, analysts, creditors, employees, future investors, and other members of the management, depend on the accuracy and timeliness of this information. The information reported by the CFO must be confidently deemed to be accurate, as many decisions are based on it.
Treasury Duties
The CFO is also responsible for the company’s current financial condition; therefore, they must come to terms with how to invest the company’s money, further taking into consideration the risk and liquidity associated with the company. Plus, the CFO oversees the company’s capital structure, allowing them to determine the best mix of debt, equity, and internal financing. Resorting to address the issues surrounding the company’s capital structure is one of the most important duties of a CFO and is considered vital.
Economic forecasting
A CFO is responsible for a company’s past ventures and its present financial situation, as they are regarded to be a key player in a company’s future growth and its increased potential to achieve that. The officer must be able to identify and report what areas of a company are considered the most efficient and how the company can capitalise on this information.
Advantages of a CFO Services
Increase in Efficiency
Getting a CFO ticks all the boxes you require to focus on the success of your organisation as they help you make better decisions, optimise processes, and save money. Enrolling a CFO will allow them to look at every aspect of the business, not leaving behind any nook and corner. Through this, CFOs enable you to see where things could be streamlined to help reduce costs or maximise profits, thus making your company grow efficiently and make your business more efficient.
Business Growth
The role of a CFO is primarily to help you achieve your goals in the market, especially if you are one of those companies who trust their CFO with their eyes closed. Then congratulations! You are already on the right path of advancement, and this is your call to continue doing so. CFOs have all the ideas about your goals and how you wish to achieve them. This enables them to assess your growth starting from where you started and helps you pave the paths of success by guiding you towards strategies that allow you to scale, thus preventing the scope of unsustainable growth.
Tax Compliance
Companies are expected to deal with large-scale tax regulations. As much as complying with them is necessary, the need to adhere to the rules and regulations is also important, lest a disruption occur due to the regular audits that take place under Government Audits. However, if a CFO is enrolled in your company, then fear not! The CFO ensures the task of properly making your firm understand the tax obligations and helps you maintain the same.
FAQ’s (Frequently Asked Questions)
Decision-making is easy as I have a responsible team to give forward the best measures effectively. Why add up additional expenses by opening up space for a CFO?
We do not doubt your decision-making skills as we hold you highly concerned for single handedly bringing your company to such a large scale all these years. However, greater workloads require specially qualified people to look into it particularly because they will act as your helpful hand and provide the best measures to upgrade your company.
What if a CFO makes a mistake in the financial report?
It is nearly impossible for a CFO to make calculation mistakes as they are well-known for their reputation as the company’s C-suite, despite being subordinate to the CEOs. Still, if your CFO fails to make an accurate report of your company’s financial accounting, consider checking your data or help your CFO as well. Humans are prone to mistakes, and our nature of dealing with them is the main answer.
