Every organization has higher management whose job is to work for the welfare of that company. The CFO has a very important role in this organization. It is necessary for every listed company to appoint CFO i.e. Chief Financial Officer.
The CFO is the senior executive of a company and is also called the top-level financial controller of the company. Because the CFO handles every activity related to cash flow and financial planning. The primary responsibility of a CFO is to maintain a positive financial outlook of the organization. This includes financial planning, management of financial risk, record keeping and financial reporting.
Therefore, all major financial decisions are made only after the approval of the CFO. In some sectors, CFOs are also responsible for data analysis. If a company wants to increase capital, invest money, start a new partnership or any major project, then all such decisions will be taken only on the basis of the approval of the CFO. The role of a CFO is similar to that of a treasurer and controller. Because he is responsible for managing the finance and accounting decisions. He ensures that the final report of the company is completed and accurate in a fixed time. After knowing so much about CFO, it is understood that this has a very important role in an organization. Perhaps you too intend to reach such a high position. In such a situation, how will it be if you come to know about the process of becoming a CFO?
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What Are The Responsibilities of A CFO?
A CFO has to fulfill all these responsibilities, executing the company’s financial strategies, creating monthly and annual financial plans, supporting the CEO, managing the company’s financial controls and accounting procedures, increasing the company’s revenue and reducing costs. To advise. To recommend an action plan for fulfillment of Annual Financial Objectives of the Company. To ensure full transparency on the financial performance of the company. Maintaining accuracy and speed in billings and client payments. Produce all text documentation according to the requirement.
Criteria To Become A CFO
So after knowing about the CFO’s responsibilities, let us now know more about the Criteria to become a CFO. So that you know what conditions you need to meet to reach this position. Most CFOs in large companies have finance qualifications. For example, MBA i.e Master of Business Administration. Master of Science and Finance or Master of Science in Accounting or CFA or they come from an accounting background like Certified Public Accountant. The finance department usually consists of qualified accountants like Certified Public Accountant, Chartered Accountant, Certified Management Accountant and Chartered Certified Accountant.
If you are thinking that you can directly reach the position of CFO by taking any course or giving any exam, then it is not so at all. Rather, you will have to go through many steps to reach this position, because this designation is at the top. You have to set a goal and move towards it step by step in order to reach it. Your schooling, graduation and further professional degree will all be part of this mission. The experience you will take in this field will be equally important. So you have to maintain professionalism. You should have clarity in your mind for your profession. Your consistent efforts will also be important. Therefore, start taking the knowledge of finance from the school level itself. So that you can reach your dream job at the right time.
That is, when you prepare yourself to become a CFO, then you will have to fulfill these criteria.
First of all, it is necessary for you to pass the 10+2 class from any recognized board. After that, you should get a Bachelor’s degree. If you want to become a CFO then you must take this degree in accounting or finance. For this, you can do BBA, BBM or B.Com. These steps will prove to be your first step in the journey of becoming a CFO. Therefore, you should take this step after thinking carefully. After this you will do MBA then you will get preference. You should take finance specialization in MBA. If you want, you can also take dual specialization. Including both finance and operations. By doing an MBA, it will be very easy for you to take the final decision of an organization.
You must also have a professional degree which can be any of these. The CA course is perfect for Chartered Accountants, understanding the details of finance. After doing the CA course, your chances of becoming CFO will increase significantly. Chartered Financial Analyst, like CA, CFA is also a professional course that teaches you about the financial domain. CFA prepares you for the role of CFO. On the same side, CMA i.e. Cost Management Accounting and CPA i.e. Certified Public Accountants can also do professional courses. That is, you have 4 choices in the best suitable professional courses for CFO. Such as CA, CFA, CMA and CPA.
Once you enter the financial world after fulfilling the criteria, you will also need to have 10 years of experience working in senior financial managerial positions to reach the position of CFO. Now the position is so high, so the experience must be strong too, right?
Having many skills in addition is necessary. Skills like Analytical Skills, Communication Skills, Cost Management Skills, Leadership Skills, Problem Solving Skills, Reporting and Presentation Skills, Time Management Skills, MS Excel & Database Query Knowledge and Stakeholder Management.
If you look closely at the career path of a CFO, then you will understand that to become a CFO, you have to be associated with any organization for a long time. To become a CFO, you will need promotions and internal job positions. You can get this opportunity as soon as possible, so it is important that you should be from a finance background and have the required experience. Even if you work in an operations-related role, it will be possible for you to become a CFO.
Because the operations manager has some technical and financial knowledge which can also lead him to the position of CFO. You should also know that one who is working in the post of Director or Manager in the Financial or Operational domain becomes a natural candidate for the post of CFO. Therefore, reaching these positions can also become a CFO. Yes, your leadership skills will also make you a strong candidate.
Salary and Packages
If the salary package received by the CFO is identified, then the minimum salary of the CFO who takes care of so many financial responsibilities of the company can be around 1 million. Which is for Startups and Small Organizations. While the maximum can be an enum at 8 million. This salary package will affect your previous salary, experience, skills and other factors. Also, the location and size of the organization will also affect your salary. Apart from this, CFOs also get incentives, bonuses, profit sharing and stock options.
In this way, you have the complete process of becoming a CFO and you have also understood that even though the journey to becoming a CFO is long if the right route is followed, it can be reached in the set time.