Who does the CFO report to? Is it the business operator, the CEO, or someone else?
The role of a CFO is among the topmost important positions in a company as they’re responsible for the financial management and strategy of the organization. But is the CFO the topmost job role in an organization? Or is there someone who’s above the CFO in the company’s hierarchy? If yes, then who does the CFO report to?
Keep reading to find out.
Chief Financial Officer Responsibilities
The CFO is responsible for the financial planning and management of the company. They develop long-term and short-term financial goals and strategies and make sure that these are met.
Equally important to remember is that the CFO also oversees the financial department. He or she is responsible for ensuring that all the employees are working towards the common goal of the company.
The CFO also creates financial reports and presents these to the board of directors. They can provide input on important decisions that the company makes, such as investments, mergers, and acquisitions, too.
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What Makes a Good CFO?
A good CFO is someone who’s able to take the company’s financial situation and create strategies that will improve it. They should be able to think long-term and be able to make sound decisions under pressure.
Good CFOs should also have excellent communication skills and be able to present complex financial information in a way that’s easy to understand.
Your CFO should also be able to work closely with the CEO and other members of your senior management team. They should be able to provide advice and input on important decisions that the company makes.
For example, suppose the CEO is considering acquiring another company. The CFO would be responsible for evaluating the financial situation of the company and providing advice on whether or not the acquisition would be a good idea.
Similarly, if the company is considering making a major investment, the CFO would be responsible for evaluating the financial risks and rewards of the investment.
Some essential qualities that make a good CFO include:
- Excellent financial management skills
- Ability to develop long-term and short-term financial goals
- Ability to think strategically
- Excellent communication skills
- Ability to work closely with the CEO and other members of the senior management team
CFO Job Qualifications
The CFO should have a bachelor’s degree in accounting or finance. Having an MBA or other advanced degree is often helpful. A CFO candidate should also have several years of experience working in finance or accounting.
Ultimately, CFO job qualifications will vary from firm to firm. However, depending on which industry the CFO works in, they might be required to have knowledge of the space. For instance, at Northstar, we look for CFOs with cannabis experience.
Does the CFO report to the COO?
The CFO does not necessarily report to the COO. In some cases, the CFO may report to the CEO. In other cases, the CFO may report to the COO or another member of the senior management team.
Who oversees the CFO?
The CFO reports to the CEO or another member of the senior management team. The board of directors may also have oversight over the CFO.
Who is higher, a CFO or CEO?
The CEO is typically higher in the company hierarchy than the CFO. However, this is not always the case. In some companies, the CFO may report to the CEO. In other companies, the CFO may report to the COO or another senior management team member.
Who is underneath the CFO?
The CFO typically oversees the finance department. The finance department may include positions such as controllers, treasurers, and financial analysts.
Final Thoughts on CFOs
The CFO is a very important position in a company. They’re responsible for the financial management and strategy of the organization.
A CFO should have excellent financial management skills, be able to develop long-term and short-term goals, think strategically, and have excellent communication skills.
Remember, your CFO is an indispensable part of the senior management team. If you find this individual isn’t providing you enough value to justify the expense, it’s best to find one who will.