
I have an accountant – why do i need a CFO?
The challenge with any industry when you’re looking in from the outside is to understand the different roles that make up a particular profession. And I know I’ve been guilty of that when I’ve looked at other professions.
Often when businesses say they have an accountant they mean a tax accountant. A tax accountant structures your business effectively for tax, and deals with your year-end tax return filings and sometimes other compliance filings.
Businesses also often refer to their bookkeeper, insourced or outsourced, as their accountant.
A bookkeeper will generally cover the following tasks
- Codes the transactions to your general ledger (eg. Xero)
- Accounts receivable – issues and chases payment of invoices
- Accounts payable – logs and pays supplier invoices
- Payroll
- Compliance filings (eg. BAS and payroll-related filings)
Broadly a bookkeeper is responsible for day-to-day transactions and ensuring that the financial data is correctly reflected in the business. The focus is on what has happened rather than what will happen.
The forward-looking lens is where your CFO steps in.
A CFO provides commercial and strategic finance leadership to support your business growth. They will be responsible for
- The “so what” of your numbers. What are your financials telling you about the health and direction of your business? What story are they telling you?
- Projecting your financial performance based on historical information and planned investment
- Running scenarios that show “what if” the business makes certain choices or is impacted by certain variables (eg. loss of a key customer or slowing sales)
- Managing risk, particularly financial risk, within the business
- Developing or evolving processes to support business growth and allow it to operate effectively
- Managing relationships with key financial partners; tax advisors, ATO, banks, lenders, and investors.
What financial support does your business have today and what does it need for tomorrow?
Let’s talk about what’s keeping you up at night.
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