Cfo (Chief Finance Officer)
CFO services provide businesses that have a finance and accounts team but do not have a in-house CFO, a Finance Partner in their growth journey. There are many challenges facing a growing business and our CFO services help you navigate those challenges effectively by providing professional advice, analysis and support to management.
Hiring a full-time professional CFO may not be in the budget of a small enterprise. Startups and SMEs are increasingly recognizing the need to have professional CFO services and realize that managing a business’s finance and accounts, compliances, corporate governance, reporting and strategic requirements are important tasks.
In the past few decades, the business world has witnessed a significant growth in the demand and expectations of financial leaders. The CFO acts as a guardian and financial leader to take care of end-to-end financial matters of the organization. A good CFO is one who understands the business well. Without good business understanding, it will not be possible for any CFO to establish best financial practices as per the need of the business for overall growth.
The CFO has the role of a professional, organizational leader, business partner and steward, integrator and navigator and finance & accounting leader. There are two essential aspects; first, conformance, which includes stewardship of organizational assets and conducting the organization to follow all legal and regulatory requirements. Second, performance which includes developing strategies, obtaining resources and maintaining these resources sustainably. They both go hand in hand and are performed simultaneously.
Functions Of Cfo
Cash Flow and Company Liabilities: A CFO is responsible for maintaining company’s cash flow and understanding company’s liabilities to be able to know what all is happening in the company. Cash flow includes understanding company’s sources and uses of cash and maintaining stability of funds and securities. Whereas liabilities include understanding all the legal contracts, statutory and tax obligations and hidden liabilities.
Treasury: CFO should know the current financial condition of the company and then decide where to invest further, keeping in mind risk and liquidity factors. He should also determine the best mix of debt and equity by looking at the capital structure of the company.
Controller-ship: Stakeholders and all the other investors invest in a company by looking and analyzing its financial information. For this purpose, CFO is responsible for presenting accurate and timely historical financial information of the company.
Economic Strategy and Forecasting: CFO is not only responsible for keeping track of company’s past and present financial situation but also plan for financial future. Also making use of capital in the most efficient manner.
Budgeting: CFO oversees the budgeting process by comparing the actual performance with the estimates defined by the company.
Investors’ Relations:CFO holds the responsibility of maintaining robust relation between shareholders and board of directors by regularly sharing budgets, forecasts and financial condition with them.
Risk Management: CFO should understand the risks associated with the business and take preventive actions to solve the same by applying control strategies.