You know What is CFO?? Do the CFO's level of authority and the CFO's words really matter in business operations? Let's learn all about CFO with CoffeeHR in this article.
What is CFO?
CFO stands for Chief Finance Officer, translated as "Chief Finance Officer". CFO is a finance-related job position. Thus, the CFO is an extremely important title in an enterprise, responsible to the General Director and the financial affairs of that enterprise.
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The role of the CFO in the business
For developed countries, the CFO is an important position in the business. They must make the most of financial tools with the aim of effectively using capital flows in the business. As such, CFOs will have to focus a lot on their roles and responsibilities. Specifically, the CFO – Chief Financial Officer will have to be:
CFO – Diplomat
What is CFO? that acts as a bridge between businesses and partners? The CFO can bring in many valuable contracts for the business. Because of the experience and wide perspective of the business's finances and the knowledge related to the numbers, it is possible to find a common voice in negotiations with partners.
CFO – Strategic Planner
When it comes to the CFO, people will immediately think of numbers and financial statements that help businesses have a clear vision of the current situation and for the next step. Therefore, if there is no CFO, it will be difficult for a business to control cash flow or it will be difficult for the CEO to operate well without someone to advise on clear financial plans.
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Thus, the important responsibility of What is CFO?? They are responsible for providing a direction to use money for the organization in the long run, and for setting up profitable investment strategies for the business.
CFO - Administrator
Depending on the structure, size or operation of the business, CFOs have different suitable financial models to optimize profits. It is the statistics on the output and input of each financial activity that the CFO can limit risks and use budget funds more intelligently for the business.
CFO – Team leader
The role of the CFO is to give the vision and future goals to the subordinates as a team leader. This is to devise strategies to improve business performance and results as well as breakthrough financial plans to increase profits and revenue for the company.
In addition, the role of the CFO is to direct multiple groups of talented individuals to achieve the grand goals of the business. Therefore, the CFO is an effective position next to the CEO to help operate more smoothly and effectively in the enterprise apparatus.
What is the job of the CFO?
As already stated, the concept What is CFO?. Therefore, the position of CFO has a particularly important task in each business, helping the business to orient and use capital effectively. This includes major tasks such as:
- Monitor and evaluate the financial activities of the business
- Financial planning consulting
- Analyze financial statements
- Liquidity
- Optimizing profits for businesses
- Coordinate with other departments
- Coordinate with the Director of Human Resources (CHRO)
- Carrying out foreign activities
- Support audit activities
- Debt control
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See more: What is CFO? The job and role of the CFO in the business
Monitor and evaluate the financial activities of the business
The financial situation of the business is always a matter of close attention. All financial related activities such as cash flow management - expenditure will be a condition to help CFO easily come up with an effective business plan.
Financial planning consulting
From the identification of weaknesses in the previous and current financial plans, the CFO will advise the Board of Directors on effective plans to use money in investment or capital raising activities to help the business. deal with the financial crisis.
Analyze financial statements
The basic role of the CFO – What is CFO?? They have the role of optimizing the financial viability of the business. As such, the preparation and analysis of financial statements will take up most of the CFO's time. All achievements or bad points along with a strategic planner's mindset are clearly shown on the financial statements.
Liquidity
The CFO needs to make sure that the business has the ability to pay its short-term debts.
Optimizing profits for businesses
All business plans are for the common purpose of increasing ROI. The higher the value of the ROI, the greater the business efficiency, because at this time the profit is higher than the investment cost.
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Besides, CFO It also helps businesses calculate and distinguish between revenue and profit. If the revenue is high but the profit is not guaranteed, the CFO must review his financial plan and the marketing business plan.
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Coordinate with other departments
Coordinate with Marketing Director, Communications Director and External Relations Director to implement the product advertising plan to balance the budget.
Communication is essential for every business. And just like other expenses that need to be paid, communication activities also need to have pre-planning costs for communication plans and advertising images for businesses with the same product brand and budget balance.
Coordinate with the Director of Human Resources (CHRO)
The cooperation between the Chief Financial Officer (CFO) and the Director of Human Resources (CHRO) aims to limit the loss of costs from the recruitment stage.
Specifically, in recruitment, candidates can "boom", fail or be fired when they do not fit the company culture. Thus, recruitment activities inevitably bring the risk of financial harm to businesses.
Carrying out foreign activities
CFOs need to step up their financial activities, especially when it comes to securing the investment capital of the business.
For the bank What is CFO?? The CFO is both a friend and a partner to banks or investors. They help businesses keep financial relationships so that they can be a solid launch pad for the company to go up.
Support audit activities
In order to demonstrate that financial operations are transparent, CFO need audit support. They have a responsibility to account for the truthfulness of the financial statements. From there, the CFO will receive the auditor's advice on loopholes in business operations.
Debt control
CFO is the person responsible for legal contracts, debts and statutory obligations, taxes, etc.
Is the CFO salary high?
With many high demands that the holder CFO position required, the minimum salary at a small company is already 15 million/month. Usually, the average salary of a CFO in Vietnam is around 40-50 million/month. Or there are places, this salary can increase to several hundred or even billions per month depending on capacity.
What are the requirements to become a professional CFO?
Once you understand the position What is CFO?? Or their power in the business, many people must have had the desire to become those high-level CFOs. Find out the content below to understand what it takes to become a CFO.
Knowledge
The Chief Financial Officer (CFO) is responsible for making financial decisions. As such, they need professional knowledge in finance, accounting, credit, financial law, etc. and many other skills.
With the above necessary knowledge, the first thing is to have a bachelor's degree in finance or accounting and can study further. Besides, some other certificates should also be considered such as ACCA, CPA, CFA.
The knowledge and skills learned at university are also necessary for you to become a CFO. This learning process will help you improve your ability to think, see, evaluate, and handle problems better. These can be considered the first steps on your path to becoming CFO.
Experience
One thing is for sure, no one can immediately take the position of CFO. They all have to go through the work sequence and accumulate experience for many years. The work experience that a CFO has will assess their ability, and is what helps employers see the potential of a suitable candidate.
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Like most other professions, CFO requires candidates to go from a low position, then move to a higher position. The initial position of a novice is usually a financial analyst. If done well, after a while, they will be upgraded to a senior financial analyst or maybe a financial planner. Next, if it's better, it will be in the position of Head of Financial Analysis, Director of Financial Planning and the last step is CFO - the pinnacle of the financial profession.
However, a prospective CFO can also come from an accountant. After a few years of accumulating experience with advanced knowledge, analytical skills and financial management, the next promoted position will be chief accountant and then CFO.
Skill
In addition to professional knowledge, CFO need soft skills such as financial planning and market analysis; ability to lead and supervise the implementation of the financial resource strategy; the ability to manage investment budgets and company expenses; Ability to allocate financial resources effectively and know how to work with relevant departments.
Necessary skills of a What is CFO? finance director (CFO) revolves around 4 common jobs of finance people including:
Financial analysis skills
The most important skill of the CFO, helps the CFO to understand the overall financial health of the business. And can quickly find financial holes to promptly respond.
Financial analysis skills are The most important skill of the CFO, helping the CFO to understand the overall financial health of the business. And can quickly find financial holes to promptly respond.
Financial planning skills
Financial planning skills help the CFO to sketch out a plan to use money for production and business activities of the enterprise.
Financial planning skills help the CFO to sketch out a plan to use money for production and business activities of the enterprise.
Cash flow management skills
With cash flow management skills, CFO . CFO can adjust the cash flow in and out of the business in a harmonious way. Avoid the inability to pay, causing business bankruptcy.
Cash flow management skills to help CFOs CFO can adjust the cash flow in and out of the business in a harmonious way. Avoid the inability to pay, causing business bankruptcy.
Problem-solving skills
Almost every job has a lot of problems, especially in the financial industry related to data and cash flow, CFOs must have good analytical, intuitive and problem-solving skills to bring results. best results and high profits for the company.
Almost every job has a lot of problems, especially in the financial industry. So the CFO Must have analytical and problem solving skills to bring the best results and high profits for the company.
Other skills
In addition to professional skills, the CFO Also need skills related to communicating with employees:
In addition to professional skills, CFOs also need to ensure optimal skills related to managing and communicating with employees:
- Negotiation skills: As a diplomat, the CFO needs to have good negotiation skills, be able to present strategic plans, evaluate the effectiveness and quality of work, and have a high level of persuasion to partners.
- Negotiation skills: As a diplomat, the CFO needs to have good negotiation skills, be able to present strategic plans, evaluate the effectiveness and quality of work, and have a high level of persuasion to partners.
- Future building skills: CFOs must have a long-term vision and use potential factors, numbers, opportunities and risks, not for the sake of small immediate benefits, but be tempted.
- Future planning skills: CFOs must have a foresight to use potential factors, numbers, opportunities and risks, not for the sake of small immediate benefits, but be tempted.
- Patience skills: The future of the company is a long-term goal, so CFOs must be patient, learn to be patient, learn from experts and work seriously.
- Patience skills: The future of the company is a long-term goal, so CFOs must be patient, learn to be patient, learn from experts and work seriously.
- Observation skills: Those with the skills of observation will often succeed in the marketplace. With a sharp mind, observing and grasping things on many fronts will help CFOs grasp the essence of the problem, not just the surface of the matter.
- Observation skills: Those with the skills of observation will often succeed in the marketplace. With a sharp mind, observing and grasping things on many fronts will help the CFO grasp the essence of the problem, not just the surface of the matter.
- Improv skills: This skill is a combination of good observation and quick problem-solving, to respond to sudden changes. CFOs must calmly face and find solutions to unforeseen or unexpected situations caused by the economy.
- Improv skills: This skill is a combination of good observation and quick problem-solving, to respond to sudden changes. CFOs must calmly face and find solutions to unforeseen or unexpected situations caused by the economy.
- Concentration skills: Do any job you need to focus, but with CFO, it is more necessary to practice a mindset, a skill for concentration to work most effectively, avoiding blind equivalence.
- Concentration skills: Do any job you need to focus, but with CFO, it is more necessary to practice a mindset, a skill for concentration to work most effectively, avoiding blind equivalence.
CFO's career path
The way to become CFO of the financial officer:
- Starting from the position of Financial Analyst (Financial Analyst)
- Promote to Senior Financial Analyst (Senior Financial Analyst); Financial Controller (Financial Controller)
- Promoted to Head of Financial Analysis Manager (Financial Analysis Manager)
- Further up, he will become a Financial Planning Associate Director.
In addition, with the direction from accountants, they need several years of working experience and accumulated knowledge in the fields of financial analysis, cash flow management, project financial management and financial planning. Once qualified, the next position will be chief accountant and then gradually move to the position of Chief Financial Officer.
So, CFO's job associated with financial decisions. The CFO needs an in-depth knowledge of Accounting, International Finance, Credit, Financial Law, and knowledge of the business environment. For the knowledge and CFO skills There are very specific requirements, so when you want to become a CFO, you should go in the direction of formal training rather than self-study.
- First, it is necessary to obtain a Bachelor's or Master's degree in Accounting or Finance to have a solid foundation.
- Then, follow advanced training courses such as Certified Public Accountant (CPA), ACCA (Association of Chartered Certified Accountants), Chartered Financial Analyst (CFA) to get internationally valuable professional certifications.
In particular, if you want to systematize your knowledge as well as master the roles, responsibilities and powers of the CFO, it is also advisable to attend CFO courses at the training center.
Difference between CFO and CEO, chief accountant
To better understand CFO, the following information and comparison table between industries between CFO and CEO and chief accountant in the business.
Comparison between CFO and CEO
| Category | CFO | CEO |
| Responsibility for the whole | The CFO is responsible for the financial aspect of the business. | As the overall manager of all activities of the enterprise, in which the manager is the Chief Financial Officer. |
| Contact building focal point | CFO is the focal point to build relationships with investors, banks, lenders, state management agencies, financial institutions. | Legal representative of the enterprise. They have the authority to meet on behalf of the board of directors with other leaders, press and developments in public. |
| Responsibility for strategies | The CFO provides financial support to the strategies, ensuring that funds are sufficient to cover the activities implemented. | The CEO is the person who is overall responsible for the strategy of the business. |
| Financial control analysis | Perform financial analysis of quantitative and qualitative attributes. They look at the aspects to best control operational costs. At the same time, they will analyze future investment capital according to market trends. | Use the results of financial analysis provided by the CFO to make decisions in adjusting business activities and investments for the business. |
| Report the work | The CFO will report the work to the CEO. | The CEO reports to the Board of Directors. |
| Development for human resources | The person responsible for finding personnel is in the area of finance and accounting. | Searching and training human resources at the management level to inherit the enterprise. |
Comparison between CFO and chief accountant
| CFO | Chief accountant | |
| Workplace | A large enterprise, usually a multinational corporation. | Small and medium enterprises. |
| Work | The person who implements the specific financial strategy for the CEO. The CFO uses the data provided by the chief accountant to analyze and come up with a specific strategy. |
Most of the data statistics and reports on the company's financial performance are on paper. The Chief Accountant assists the CFO in collecting financial data from departments,… |
| Income | Income ranges from 30 to 50 million VND/month. | Income from 15 to 30 million VND. |
Some famous CFOs in today's world
Le Thanh Liem – Sticking 1/4 life with Vinamilk
During 28 years of working with Vinamilk. He has accompanied Vinamilk to overcome the fierce competition of Vietnamese and foreign dairy companies.
Joined Vinamilk in 1994 with the position of accountant, with his efforts, he was appointed to the position of deputy head of accounting department in 2003. In 2005, he held the position of chief accountant. From December 24, 2015 until now, he has been operating at Vinamilk for 7 years with the position of Chief Financial Officer. Extraordinary efforts, perseverance and outstanding ability have helped Mr. Le Thanh Liem become one of the most famous CFO faces in Vietnam today. Le Thanh Liem's journey of 1/4 life with Vinamilk is truly admirable.
Duong Thi Mai Hoa – Former CFO and CEO of Vingroup
Ms. Duong Thi Mai Hoa was born in 1969, graduated from the Department of Chemical Economics, Hanoi University of Science and Technology and holds a master's degree in business administration from the University in Belgium affiliated with the National Economics University, Hanoi. .
This businesswoman holds a record of 7 "job jumps" but all 7 times have been "usurped" in core positions at a billion-dollar enterprise in the field of Finance, Banking - Aviation - Real Estate.
- 2013: General Director of Vietnam Maritime Commercial Joint Stock Bank (Maritime Bank)
- From 2014 to 2018: Ms. Hoa "joined" for billionaire Pham Nhat Vuong as the General Director and Chief Financial Officer (CFO) of Vingroup.
- May 2018: Ms. Hoa was appointed General Director of An Binh Commercial Joint Stock Bank
From October 2018 to present: Ms. Hoa holds the position of Vice President cum Deputy General Director of Bamboo Airways, FLC Group.
Detailed CFO job description sheet
The above content has pointed out the concept of "What is CFO??” or the roles and jobs that the CFO position needs to do. Therefore, the role of the CFO is indispensable for the smooth running of the business.
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