Tags: Fractional CFO, Outsourced Bookkeeping Services, Outsourced CFO, Sarasota Tax Problems, Virtual Accounting Services
Did you know that one of the main reasons businesses fail is due to a lack of funding or working capital?
In many cases, this isn’t a result of not enough revenue, but a lack of financial planning. That problem is easily solved by having a great CFO on your team.
But what is the role of CFO? Beyond financial planning, these executives manage your business’s money, ensure you’re compliant, and take care of important historical reporting.
If you think it might be time to take a CFO onto your team, keep reading to learn more about what a Chief Financial Officer is and what they do.
What Is a CFO?
A CFO, or Chief Financial Officer, is part of your C-level executive team. They work with the CEO, COO, and any other C-level executives that form the leadership of a business.
Unlike these other executives, the CFO focuses on finances and the financial actions of the company. They’re in charge of past, present, and future money management on many different levels.
The Role of CFO
The main role of CFO is to be in charge of a businesse’s money. But the ways in which they do this vary greatly.
Typically, there are four main CFO responsibilities: reporting, managing money, planning, and compliance. We talk about each in more detail below.
CFO’s do all the reporting of a business’s historical financial data. They may oversee a team that helps them do this. And, truth be told, this is what they spend the majority of their time doing.
These reports are then shared with employees and shareholders. They may also be shared with analysts in order to make future decisions.
A CFO will also manage a business’s cash flow. This involves making sure that the profits and revenues are larger than operational and other costs. A good CFO will also attempt to improve that cash flow.
This is the most creative aspect of the role of CFO. They are the main driver for creating financial plans for the business.
These financial plans involve budgeting, investing, and finding new funding and working capital. This is extremely important because having a financial plan is what helps a business grow.
Some industries and business structures (like a corporation) have certain laws regulating them. And all businesses have to comply with certain tax regulations and requirements.
A CFO ensures that a business is compliant in these manners. Compliance is of utmost importance because non-compliance can lead to hefty fines.
Looking for Financial Help with Your Business?
The role of CFO involves everything from financial planning and compliance to managing money and reporting. They’re a key player of the executive team that takes care of all the money, ensuring that you have the financial health to grow and develop.
Not all teams require a CFO, though. Sometimes, you just need a little help from the professionals. Contact us to find out how we might help your business in the matter of healthy finances.
Learn how Sterling Tax & Accounting can add value to your business!
Your virtual accounting and technology experts providing back office, compliance & strategic solutions for busy professionals.