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What Does a CFO Do?

 

The job of the CFO falls into three foremost categories, which are broken down in additional element under as we try to stipulate for you, "What does a CFO do?".

 

 

 

 

1. Reporting

 

Reporting takes up plenty of a CFO’s time, and this responsibility typically resides within the Controller’s group. This crew of professionals prepares all the company’s historical financial reports required for shareholders, employees, lenders, research analysts, governments, and regulatory bodies. This group is responsible for making certain all reporting is prepared in an accurate and well timed manner.

 

 

 

 

2. Liquidity

 

The CFO wants to ensure the corporate is able to satisfy its financial commitments and handle money flow in the most efficient way. These responsibilities are normally carried out by the treasury group, which is commonly smaller than the reporting team. This group is tasked with managing the company’s money balance and working capital, reminiscent of accounts payable, accounts receivable, and inventory. They also perform the issuing of any debt, managing investments, and handle different liquidity-related decisions.

 

 

 

 

3. Return on Funding

 

The third thing a CFO does is assist earn the corporate earn the highest possible risk-adjusted return on assets and return on capital (or return on equity). This is the place the financial planning and analysis – FP&A group – is available in to help the CFO forecast future cash flow of the enterprise after which compare actual outcomes to what was budgeted. The FP&A staff performs a critical role in analytics and choice making within the business.

 

 

If the company has a corporate development group, they also play a big part in creating (or attempting to create) optimum investment returns for the business.

 

 

 

 

What Else Does a CFO Do?

 

Surely the above is just not all a CFO does. Well, the above is actually quite quite a bit for a CFO to do, but there are different duties that include leadership, communication with the board, negotiating with suppliers and vendors, and supporting the corporate’s mission, vision, values, and culture.

 

 

Different teams that may report to the CFO embody supply chain, procurement, information technology (IT), and nearly another department, depending on the organization and the skin poor health set of the CFO.

 

 

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