The coming year may bring greater uncertainty, according to experts. Now for the good news: Even though there will inevitably be outside influences, having more financial assurance will help you deal with any challenges that may arise.
There is a lot of discussion about the chief financial officer’s evolving duties (CFO). Modern CFOs have a lot of responsibilities, from managing personnel to managing environment, social, and governance (ESG) performance. Here is a helpful checklist to assist you whether you are a CFO who is unsure where to begin or a C-suite executive who wants to assist your finance executives as they adjust to their new position.
CFO check list to ensure that you’re in the game!
For the first 90 days, the CFO should understand the business.
- Learn about the business’s finances
- Examining Current Performance and Existing Processes
- Learn About the People and Cultures
- Place Priorities
- Make a road map.
- Construct Strategies
1. Recognize the Industry
You are in charge of making sure a company’s finances are in good shape as the CFO. To do this, you must have a thorough grasp of the company and all of its sources of income. You must devote time to thoroughly familiarizing yourself with the firm throughout your first 90 days on the job. Meeting with important stakeholders, looking through financial accounts, and conducting research are required. Learn about the company, the staff, the offerings, and the target market.
You can only make wise judgments about how to effectively spend resources and expand the firm if you take the time to fully comprehend the business.Even while it could seem like there is a lot to be done in the first 90 days, keep in mind that knowing the business is crucial to ensure its success in the long run.
2. Set Priorities
Setting the financial priorities for your organization is a responsibility of your new position as CFO. Although this may seem like a difficult undertaking, keep in mind that you only have a short window of opportunity to create an impression. During your first 90 days on the job, you should concentrate on setting priorities and putting in place the procedures and systems that will enable you to accomplish your objectives and create a long-term strategy.
Understanding the business’s financial situation in-depth should be one of your top priorities. You must examine previous financial accounts, comprehend the working capital and cash flow requirements of the moment, and assess risk exposure. Making a budget and forecasting method that can give insight into future financial requirements should be another top goal.
Along with establishing oneself as a trusted counsel, you should concentrate on fostering connections with important stakeholders including shareholders, workers, and suppliers. These connections will be crucial as you attempt to overcome the difficulties of the present economic situation.
3. Learn about the Business’s Finances
During your first 90 days on the job, learning about finances is the most crucial responsibility. You can make sure that your selections are in the best interests of the company and its shareholders by taking the time to have a thorough understanding of the firm’s financials. By doing so, you’ll be able to clearly comprehend the company’s existing financial status and see any potential improvement areas. Knowing the fundamentals will provide you a better grasp of how the company runs, what adjustments could be necessary to increase profitability, spot possible issues, and prevent them in the future.
For instance, if you see that the business is not making enough money, you might take actions to boost sales or cut costs. The ability to communicate effectively with the CEO and other important figures about the future of the firm and ways to enhance its financial performance can also be facilitated by being familiar with the financials.
4. Build a Road Map
You’ll get the opportunity to make your mark on the company for the first time by developing a roadmap. It serves as your initial donation and point of entrance. You may use it to establish your strategic direction, choose priorities, and obtain a sense of the overall situation.
The roadmap should outline the company’s financial objectives, an evaluation of the existing financial status, and your strategy for achieving those objectives. Any dangers or difficulties that could have an effect on the business’s finances should also be identified.
So don’t be reluctant to roll up your sleeves and begin working on your plan right away. One of your finest investments in your new position will be this one.
5. Understand the People and the Culture
The roles of an accountant and a CFO are very different. The strategic direction and leadership are your responsibilities as CFO. Getting a handle on the company’s finances, business strategy, and competitive environment will be a top priority during your first 90 days, but it’s also crucial that you get to know the company’s employees and culture.
After all, a company’s ability to generate revenue is highly dependent on how motivated and effective its workforce is. It will take time to identify their advantages and disadvantages and build rapport with important stakeholders.
6. Analyze Current Procedures and Performance
A process evaluation is a necessary step in comprehending a company’s financials. This assessment must take into consideration efficiency, accuracy, and compliance, among other things, but it will also aid in identifying any possible dangers.
You will be in charge of not just the company’s financial stability but also the implementation of any adjustments that must be made to the current procedures. You must ascertain which procedures are successful and which require improvement in order to ensure that the business is running as effectively and efficiently as feasible. Examine the financial accounts in detail, and consider the activities and cash flows. You may find locations to cut costs or boost income by using this analysis to find such areas. With thorough analysis, you can create a roadmap for the future, make sure that any adjustments are supported by reliable data, and determine whether the business is on course for success.
By getting to know the team members and the company’s culture, you may see any possible problems that can affect employee morale or motivation as well as obtain a deeper grasp of the company’s guiding principles and the ways in which they influence decision-making. When it comes time to make important decisions regarding the future of the organization, this information will ultimately be priceless. You may make better choices about how to allocate your limited resources by understanding people and culture.
7. Establish Strategies
You may start formulating plans for improvement after you have a firm understanding of the financial state of the business. In order to do this, you might need to automate your accounting procedures, adopt new accounting standards, alter your organization’s structure, or look for new sources of funding.
You may use your new tactics to create accurate financial accounts, uncover cost-saving opportunities, increase income sources, identify cost-saving methods, and implement strong internal controls. Regardless of the strategy you choose, it is crucial that you take prompt action and make decisions to protect the business’s finances. In order to secure the company’s long-term financial stability, you must be proactive in formulating plans. You should also collaborate closely with the other members of the executive team to guarantee that all departments are working toward the same financial objectives.
The possibility to leave your stamp on the organization exists even though becoming a CFO might be difficult at first. You’ll be better able to set objectives and devise plans of action if you thoroughly understand the firm, its stakeholders, its finances, and its operational procedures.Although it may feel like there is a lot to accomplish, it is crucial to concentrate on the most crucial activities within your first 90 days on the job to get off to a strong start and have a favorable influence on the business’s bottom line.
CFO best Practices for Creating a Cutting-Edge Finance Department
1. Examine existing procedures to find inefficiencies
2. Go over the contracts and budgets
3. To prevent unpleasant surprises, review the loan agreement.
4. Innovation and cooperation between teams
5. Refresh and modernize the staff
6. Improve working capital and cash flow
7. Put risk management, GRC, and ESG first
8. Look for fresh chances for expansion and ways to boost efficiency
9. Arrange financial investments in data analytics and cutting-edge technology
10. A blueprint and long-term vision
How might High Radius assist CFOs in checking off their to-do list?
Leading fintech company HighRadius uses self-driving software to improve the order-to-cash, accounting, and treasury processes in the office of the CFO. Data-driven software that continually adapts its behavior to the underlying transactional data of the domain is known as autonomous software. It provides the finance & accounting industry with out-of-the-box functionality for current digital transformation technologies including robotic process automation (RPA), artificial intelligence (AI), natural language processing (NLP), and connected workspaces.
We assist CFOs and finance teams in producing quantifiable business results including decreased DSO, optimized working capital, less bad debt, accelerated month closure timeframes, and increased productivity.