For the short and simple answer, no! Financial accounting is no longer a prerequisite. The function of a Chief Financial Officer (CFO) is changing. In fact, the position of CFO is shifting away from having an accounting background and focusing more on financial analysis capabilities.

Now, when organizations look for a CFO, the first thing that springs to mind is a strategic game plan. Candidates must have prior experience with strategy and the ability to implement it. Companies want their CFO to be able to handle future recessions while also developing their business.

The CFO Today

The responsibilities of today’s CFO extend beyond the accounting and finance departments. Instead, they perform a role that is more connected to the company as a whole like Human Resources, IT, and risk management besides accounting and finance. Companies seek a CFO with strong operational expertise to help them manage these changes.

In place of being a lead technical accountant for the firm, the CFO will take on a more active role as a company visionary. Their new responsibilities will include increasing and automating operations. This will ensure that the firm’s cash flow is sufficient enough to meet its obligations. For fresh and aspiring CFOs, strategy is increasingly important.

Financial Planning Roles

As the CFO responsibilities shift away from financial accounting backgrounds both corporations and CFOs are looking at other options in the finance arena. In fact, it is not uncommon to find a CFO with an MBA or a degree in Finance who came up the ranks as an Auditor and has only been in the CFO position for a few years.

Today’s CFO is responsible for overseeing more than just the accounting and finance department. Instead, they now serve a role more integral to the function of the entire company. This includes interaction with Human Resources, Information Technology, and even risk management. To accommodate this change, companies want a CFO with a firm grasp on company operations and financials, rather than one who just has an accounting background. After all, the CFO’s role is to ensure the company is successful over the long term so it can continue to grow and thrive.

Their new role will engage in helping user growth and enabling operational expansion. The company’s cash flow will consequently flow with this strategy. Current trends have made it clear that the key to the future of CFOs is achieving a better balance in life.

Chief Financial Officer without the Accounting Background

Accounting and finance are always changing. The accounting industry has been shifting from a focus on development to one on financial reporting and compliance. Now it is very common for a CFO to not need an accounting background to excel at his or her job. However, finding a CFO with a background in accounting provides an even deeper level of understanding and enables the CFO to better explain changes in the business.

The world of accounting and finance continues to advance in order to meet the problems posed by the global climate and economy. This will continue to be the case with the role of the CFO. This evolution will occur as society progresses, changing accounting and finance functions. Each of these responsibilities will alter along with the world. Of course, the CFO of tomorrow will rise to cope with new situations and challenges as they surface.

The CFO of the Future

Every year, the world of accounting and finance changes because of new developments. After 2002, professional accountants shifted their focus away from revenue growth and to financial reporting and compliance. In 2008, the financial community saw a further shift towards an all-encompassing business strategy during the Great Recession. Now, in 2022, the CFO is increasingly responsible for strategic planning and growth. As the financial industry continues to grow, the role of the CFO will continue to evolve as well.

In its early stages, accounting and finance focused on making sure that business records were correct, managing transactions, and maintaining financial accounts and the CFO was responsible for overseeing these tasks. As time progressed, the role of CFO expanded to include budgeting, forecasting, and financial analysis. Today, the role of the CFO has evolved even more and is increasingly responsible for strategic planning and growth.

As CFO roles move away from an accounting background it will have implications for other accounting roles in the company. Because of the reduced focus on technical accounting, the need for Chief Accounting Officers (CAOs) and controllers with extensive accounting knowledge will grow smaller. Companies that have a CAO, will be responsible for overseeing financial analysis and strategy, which will be a departure from their historical role. The need for CFOs with accounting backgrounds will decline as well.

This is why accounting agencies like Luca Financial are ready to help ease the burden and assist CFOs, so that they can focus on other parts of the job, like getting the company ready for growth and expansion.

At Luca Financial, we pride ourselves on offering CFO’s a well-rounded batch of services when it comes to their business.

  • Work with CFO’s on identifying opportunities for growth
  • Preparing budgets that will accommodate any expansion plans or a potential exit strategy
  • Provide advice about how best to upscale without compromising service quality, while still being cost-effective
  • We take our time so each client gets an individualized experience from start until finish
  • Offer nothing but top-notch financial services

A list of effective solutions to your financial accounting needs is available to CFOs looking for help. Please contact Luca Financial today or schedule some time with us!

Recent Posts

How to Prepare Financially for Hurricane Season 2024

How to Prepare Financially for Hurricane Season 2024

How to Prepare Financially for Hurricane Season 2024   As we edge closer to hurricane season 2024, it's crucial to focus on not only our physical safety but also our financial security. The tropical storm season kicks off June 1st and lasts until November 30th....

Finding the Best CPA Near You for Your Small Business

Finding the Best CPA Near You for Your Small Business

Finding the Best CPA Near You for Your Small Business In the intricate world of small business management, financial expertise is paramount. But, for many business owners, dealing with tax laws, financial statements, and rules is hard.  This is where hiring a...