Please note javascript is required for full website functionality.

What is a CFO, what do they actually do, and do you need one?

There are stories of success and failure, of good ideas and bad. One of the life bloods of any business (notice I said one, not the only!) is financial management. Some people are good at it, some not so much and, to be completely honest, that’s ok – we all have a different skillset and different attributes.

The most common answer to the question of how well your business is doing financially is usually centred around cash in the bank – either having some (seen as good) or not (predominately seen as bad!). As a basic indicator, it's a pretty important one – but is also important to know what may be causing these high or low levels of cash.

Is it due to a downturn in business?

Is the business growing?

How good are your customers at paying?

How good are you at paying your suppliers? 

Is there a major project underway?

Have you recently paid a BAS? Is it super time?

The list can be endless...

Are you recruiting?

Have you purchased items for work, which has now been cancelled or postponed?

Are you moving premises?

Are you paying your staff too much, or maybe too little?

Do you have enough cash to pay the next wage run?

And if not, what is going to happen?

Some business owners will have some idea of the answers and other times they won't. Some will rely on employees to have the information, some will not. There is no right or wrong answer – but I am sure you will agree, it would be good to know the reasons rather than guess them?

As businesses grow, they reach different stages of maturity, dependent on the journey they are on. The initial start-up stage, which brings with its excitement and anxiety, and can be quite frantic. As time progresses, and the business is gaining traction and momentum, the growth stage will occur. Confidence is high in the organisation, it’s good to run your own business and there may be an opportunity to take some reward for all your hard work.

As this growth continues, it then becomes important to maintain and support this growth with extra resources, which need managing and controlling. This takes up more time than anticipated and brings with it stress and frustration and may also mean that the skill set existing in the organisation may not be sufficient. Investment in the skills is not easily decided upon, as it might be clear the business requires them, but what is it going to cost and what will I get?

The services of a CFO/Financial Controller/Finance Manager are, more than likely, one of these services. You may have an internal or external bookkeeper processing your transactions. You may have an external accountant, who will assist with your compliance obligations and reporting, but may not be involved in the internal, everyday financial aspects of the business. A dedicated finance resource will be focused on what the business requires and will work to reinforce and strengthen the internal financial regime – allowing the release of the one thing we always seem to never have enough of – time – which is then “reinvested” into other areas of life – either professionally or personally.

Some key areas a CFO can assist with include:

  • Looking at internal systems and procedures
  • The level and scope of reporting within the business;
  • The interpretation of historical data
  • The viability of budgets and forecasts
  • Analysis of the cost base within the organisation and the profit improvements that could be obtained
  • The cash and working capital position both now and in the future
  • Management of customer collections and supplier payments

I understand that each business is different, and what the resource I offer will never do is tell you how to run your business – that is an extremely arrogant approach and does not lead to many long- term relationships! You are the experts in your field, you have the passion to drive your businesses, we are here to support and assist you!

What we provide, is a trusted source of information and advice. This is done through delivering on what I have been involved in for over 20 years.

I hope this has provided some insight into what a CFO can do, and where the advantages can be seen for your organisation.

We're here to help tackle those challenging financial questions

Whether you need a specific financial solution or just better visibility, a great place to start is with our obligation free health check.