Any company that wants to succeed must accept the need for financial leadership. In early stages this is often handled by the owner/president/CEO. But growing companies often find there comes a time that won’t work anymore. Managing the financial information of the business becomes too demanding for the person managing the business to handle. At this point many businesses outsource their accounting function by hiring a CFO.
But did you know many of these businesses don’t actually hire a CFO? They hire what we call a glorified bookkeeper carrying the title of a CFO. They are happy to find their books are reconciled and they get financial statements. But they don’t get any value beyond that. And that is not a CFO.
With that in mind, our team decided it was time you knew exactly what you should be getting from your CFO.
What You Should Be Getting From Your CFO
Here are the top five results your CFO should be providing you:
1) Data analysis
CFOs are rarely the people actually handling your accounting. But they should be regularly reviewing the financial details of your company. And they should be providing regular feedback on areas of concern as well as successes
2) Financial planning and strategy
A good CFO will be able to help you plan for your goals as the owner of the business.
- Are you looking to retire in five years?
- Double revenues?
- Improve your margins?
A CFO should be able to help you determine how to achieve these results. And if you don’t know what results you want, a good CFO should be able to help you figure it out.
3) Candid yet supportive feedback
Perhaps your goals aren’t attainable. Or perhaps there are some major red flags in your business. Or maybe a path you’re pursuing is preventing you from achieving your goals. A good CFO should have the knowledge and courage to be able to share these details with you when needed. Yet they should also know when it’s time to defer to your decisions as the owner of the company.
4) Skilled communication
A CFO who knows all the data but can’t present it well will have a hard time actually bringing you value. A good CFO must be as skilled at helping you understand what they see as they are at seeing it. Otherwise what’s the point of seeing it?
5) Knowledge of your business
You’ll find most CFOs when you first hire them don’t know everything about your business, even if you hired one with experience in your industry. But you should expect the CFO to be able to learn about your business, and if necessary industry, really quickly. One that doesn’t understand your business and industry is not a CFO worth hiring because they won’t be able to help you make decisions.
These are all reasonable expectations you should have of your CFO.
If you’re not getting these results, the first thing to do is evaluate your expectations. Have you made it hard for them to communicate or given them work that is preventing them from giving you these results?
If so, you need to work on fixing it immediately. If not, you should ask yourself if your CFO is the problem. And if they are, it’s time for a new one.
We Serve Clients All Over the United States, But We Are Proud to Call Utah Home
If you’re ready for a new CFO, let us show you how we can help.
We’re located in Utah County and serve customers nationwide, so don’t hesitate to call us regardless of where you are located. We look forward to answering any questions you may have.
Not Claiming Enough Depreciation Could Cost You