The Role & Responsibilities of a CFO (Chief Financial Officer) in a Multi-national Business

A Chief Financial Officer (CFO) is a high-ranking official in an organization whose role is to manage the finances of a company. They have to maintain the financial health of a business. Their responsibilities are not limited to balancing revenue and expenses and building a quality accounting and finance team. CFOs also supervise financial planning functions, obtain funds, analyze financial data, and create budgets. The CFO must also confirm the accuracy of the financial reports.

How Does CEO Differ from CFO?

A CEO is the chief executive officer of a company. Their role depends on the structure of the company. However, they are responsible for all aspects of the firm. The CEO is the face and voice of the company. On the other hand, the primary duty of the CFO is to take care of the organization’s financial aspects. They provide reports to the CEOs and serve as part of the board of directors. Therefore, the CEO occupies a higher position than the CFO. Bernard de Laguiche is a prominent Swiss-based Businessman and experienced multi-national CFO who has supervised organizational financial activities by helping meet revenue and earnings targets and stabilizing cash flow. He is a CFO with sufficient experience in large multi-national organizations and has led in the simplification of projects.

CFOs study complex financial data from past, current and future financial results to help organizations make informed financial decisions. They facilitate decisions like introducing new products or services based on the company’s financial status. Here are the elaborate responsibilities of a CFO.

1. Reporting

It is also critical for CFO to provide financial reports, including cash flow statements, balance sheets, P&L, etc. These reports help internal and external shareholders know the company’s financial status. Therefore, the CFO must confirm the accuracy of these reports before presenting them to the stakeholders. Remember, a company must file annual reports, which attracts fines and penalties. Therefore, financial reports are crucial. They are also necessary when a company wants funding or a bank loan.

2. Forecasting

CFOs are also expected to give accurate reports of future outcomes. They need to forecast the organization’s financial status and model the financial aspect based on the company’s past performance. They need to include external and internal factors that affect the expenses and revenue of the company. Internal factors include HR costs, sales trends, labor, cost of raw materials, and others. External factors include market shifts, competition, technology, etc.

3. Return on Investment

A CFO must ensure high ROI based on the inputs of the organization. This means they need to be able to measure the revenue garnered on the money invested. They look at the ratio of gain versus the investment loss based on the cost. They also evaluate projects to know their worth and whether they will bring meaningful ROI.

Conclusion

A CFO is a crucial member of a company since they guide the accounting and finance team and confirm the organization’s financial health. The expert is in charge of a company’s financial decisions. Therefore, they forecast the financial state based on the operational and financial data.

Leave a Reply

Your email address will not be published.