CFOs are in charge of a wide variety of activities that impact a company’s growth. It takes a lot of effort and determination to rise to the top of a company’s financial hierarchy. While the scope of responsibilities varies by sector and company size, it’s worth noting that everyone’s journey to becoming a CFO is unique.
Tasked with ensuring the business maintains a positive financial outlook, the CFO needs to confirm the go-ahead for new ventures or partnerships. As with every executive role, being a CFO entails long-term dedication and careful preparation.
Let’s see what the path to CFO entails, their responsibilities & the skills and qualifications needed to become a chief financial officer.
What Is a Chief Financial Officer?
A Chief Financial Officer (CFO) is in charge of a company’s financial operations and is active in budgeting and financial reporting. They are heavily involved in strategic planning; they will help formulate and implement business goals while monitoring key performance metrics in partnership with other stakeholders. The role also includes acting as a strategic advisor to the CEO, being a team leader to other employees, and interacting with third parties relating to company finances.
Responsibilities
CFOs are the ones included in any financial decision that is made within an organization. The exact duties depend on the scale of the company and the industry itself. They’re in charge of running departments involved in sourcing, pricing, savings, taxes, debt management, and accounts payable.
The day-to-day duties of these professionals include:
- Maximizing profits while mitigating financial risks and losses.
- Managing investment portfolios and conducting audits.
- Supporting expansion by raising capital or taking a private company public.
- Developing financial strategies for mergers or acquisitions.
- Analyzing market trends and generating economic forecasts.
- Ensuring compliance with laws and regulating agencies.
- Recording of company-wide transactions.
- Reporting on expenditure and projections.
The Skills & Qualifications of a CFO
With such responsibilities, one has to keep up with industry trends and have the right academic background and credentials.
What degree does a CFO need?
A bachelor’s degree is the first step toward a promising finance career. Aspiring CFOs can establish a strong foundation with a bachelor’s degree in business management, finance, accounting, or economics. During their undergraduate studies, ambitious students cultivate leadership skills crucial for managerial positions.
Since the position of CFO includes leadership and management roles, earning an MBA will help you gain experience and prepare for the job. Obtaining an MBA or an MBA with a specialization in finance program will help finance professionals advance in their careers.
Essential CFO skills
As a CFO, almost anything you do entails some level of leadership. CFOs have to be strategically minded, execute strategies and need awareness of shifting markets and competitor behavior. Accounting and tax knowledge are also fundamental for a CFO.
Chief executives possess the following qualities:
- Communication
- Decision-making
- Leadership
- Management
- Problem-solving
- Time management
- Data skills
Credentials
A financial professional may be required to obtain Certified Public Accountant (CPA) licensure via state board approval in order to become a CFO. They may also be required to be a Certified Management Accountant (CMA) or a Chartered Financial Analyst (CFA).
Obtaining such certifications typically entails meeting experience and educational standards, as well as passing a test.
What Is a Typical CFO Career Path?
When pursuing a finance degree, students can participate in hands-on internships and apply what they’ve learned in class to real-world situations in business finance. Before becoming CFOs, many professionals serve in finance-related positions. Banking, accounting, trading, consulting, financial reporting are all options for a fulfilling finance career.
Finance professionals can work in almost any sector since finance is an essential part of any economically viable company. Specializing in one field, on the other hand, improves one’s chances of success. Aspiring CFOs should develop specialized knowledge on their desired career path. It’s beneficial to learn about industry-specific tax laws, legislation, budgeting procedures, investment methods, and other facets of business such as mobile banking and international finance.
Particular roles that lead to becoming a CFO are:
- Finance Manager
- Operations Manager
- General Manager
You’ll wear several different hats as a CFO during the day. In order to climb the corporate ladder and become successful, you must also be enthusiastic and aware of the duties and commitment required for this role. Prepare to demonstrate your adaptability, versatility, and willingness to be constructive in fostering long-term development.
Make the first step by enrolling in our Bachelor of Arts in Economics & Finance program, or consider the Master of Business Administration with a concentration on Economics & Finance program to get one step further into your career as CFO.
