Thursday, January 29, 2015
Qualifications of a Chief Financial Officer
A company's Chief Financial Officer (CFO) is responsible for ensuring the financial health of an organization. This executive level position is held by leaders with exceptional skills and experience. Here are some of the qualifications held by typical CFOs of large corporations.
Because Chief Financial Officers s are concerned with strategic level financial decision making, they usually have an accounting or finance academic background. The typical undergraduate degree program undertaken by ambitious students who have their eye on the CFO position is the Bachelor of Science (B.S.) in Accounting, and the B.S. in Finance is the second most popular degree program chosen by them. Some people do not start their academic years with the desire to be the top finance officer of a company, but they develop the qualities that fit the position later. Many of these people have undergraduate degrees in business administration or in a number of the sciences. In these cases, future CFOs usually still manage to obtain formal accounting and finance training through the completion of advanced degree programs like the Master of Science in Finance or Accounting. A classic academic combination for CFOs is a B.S. in Accounting and a Masters in Business Administration.
Common Licenses and Certifications
Surveys taken by samples of company CFOs showed that many of them start their careers as accountants and possess the certified public accountant (CPA) designation. Besides the important state administered CPA license that is needed to practice public accounting, CFOs who enter the executive ranks through the accounting field may also have the certified management accountant credential. Alternately, CFOs who have strictly finance backgrounds may have completed the challenging chartered financial analyst training and examinations.
Progressive and Broad Job Experience
The accounting academic degree programs in which most CFOs have participated help them to develop a wide range of skills that they need to be successful in a number of accounting related jobs. These jobs in auditing, forensic accounting and financial reporting give CFOs basic experience in the areas of financial compliance and risk management that they commonly apply to financial strategy development. CFOs are usually the spokespeople for corporations when it comes to investor relations, and previous positions as financial analysts and investment banking managers help them to effectively communicate with investors about their company's financial status.
While the role of CFO can be challenging and rewarding, the position is obviously not for everyone. Mastering the fundamentals of finance and accounting is the first step towards the c-suite. However, aspiring financial executives must demonstrate managerial and leadership skills throughout their careers that are normally composed of a variety of mid to senior level finance jobs.