Understand the CFO role: Key responsibilities and essential skills 

Imagine you have a SaaS business experiencing a surge in growth. Revenues are skyrocketing, and your customer base is expanding rapidly.  

This is the moment you’ve worked towards, but with this success comes new challenges, particularly in managing your increasingly complex finances.  

Consider bringing in a CFO, which stands for Chief Financial Officer (CFO). They could be critical to smooth business operations and your future. 

A good CFO can become your strategic partner—somebody who can navigate the complexities of financial planning, risk management, and data-driven decision-making. But you might be asking? 

• What does a CFO do? What is their role? 
• But when is the right time to bring a CFO on board?  
• How do you balance the cost of hiring a high-level executive with the clear need for expert financial guidance? 

We’ll explore what a CFO can do for a scaling business. Learn more as we guide you through their role, skills, and core responsibilities. 

We’ll also discuss how a CFO could be instrumental in steering your company through growth phases, managing investor relations, and laying a solid foundation for sustainable financial health. 

In this article, we will cover: 

• What is a CFO in business and what do they do? 
• What are typical CFO tasks and responsibilities?
• 8 ways a CFO could help grow your small business
• When should you hire a CFO?
• What qualifications would a CFO need?
• What skills are essential for today’s CFOs?
• Final thoughts​​ 

What is a CFO in business and what do they do?

Think of somebody in a central, multifaceted, pivotal role who’ll be very helpful as you grow and scale.  

A multidimensional role in modern businesses

Having a CFO signifies more than financial management—they’re a crucial driving force in guiding your company toward sustainable expansion and success. 

They won’t just oversee the company’s finances—they play a part in a broader spectrum of strategic leadership and decision-making. 

A strategic partner in growth and scaling

Your CFO will be instrumental in navigating the complexities of scaling up, ensuring that your company’s financial strategies align with its broader growth objectives.  

This alignment is crucial for sustainable expansion, and your CFO must make informed decisions on investments, resource allocation, and risk management.  

Integrating financial expertise with business strategy

A key aspect of your CFO’s role in business growth is integrating financial expertise with overall business strategy. They will work closely with other C-level executives, providing financial insights that inform critical decisions, from product development to market penetration strategies.  

This collaborative approach ensures that financial considerations are embedded in every strategic decision, driving growth in a financially responsible manner. 

Managing investor relations and stakeholder expectations 

As businesses grow, managing relationships with investors and other stakeholders becomes increasingly important.  

Look to your CFO to handle these relationships, presenting the financial health and prospects of the company in a way that builds trust and confidence.  

Your CFO will be pivotal in fundraising efforts, capital structuring, and communicating the company’s financial trajectory to the outside world. 

Innovation in financial management for growth 

CFOs are often at the forefront of innovation in financial management, using technology and data analytics to gain insights and improve efficiency.  

You’ll want their approach to financial management to be proactive, focusing on predictive analysis, scenario planning, and agile methodologies to stay ahead of the curve. 

What are typical CFO tasks and responsibilities?

A CFO will be the most senior finance professional responsible for the financial health of your business. But they tend to wear many hats in medium-sized companies—and even many large ones.

Essential CFO responsibilities could include: 

• Building the finance and accounting team 
• Balancing income and expenses 
• Overseeing financial planning and analysis 
• Confirming the accuracy of financial reports 
• Analyzing financial data 
• Supporting strategic decisions 

Strategic recommendations could be anything from deciding on marketing spend to supply chain relationships, investments, and mergers. 

Strategic recommendations could be anything from deciding on marketing spend to supply chain relationships, investments, and mergers.  

Your CFO may need to partner with leaders across the organization and support its growth and scalability (which we’ll discuss in more detail later). If you are venture-backed, they’ll manage the fundraising process. 

Sage Intacct customer Forecast, for example, brought in CFO Simone Goodman because the fast-growing enterprise SaaS business wanted to grow in the US market. 

Because it was a Series A startup that needed a fully formed leadership team, Simone spent the beginning of her time working with CEO Dennis Kayser on building one. But she also played a big part in deciding what financial management software it wanted to use going forward. 

Simone says: “At the same time as bringing people in, a CFO can take a critical look at the tech you have in place and whether it’s fit for purpose, today and tomorrow. 

“Does it play harmoniously with your systems, and can it scale with your business? If not, rip it out and replace it.” 

“A CFO should at least be accountable for overall company performance through effective planning, performance management, risk management, governance, and organizational alignment—including effective HR and systems management,” says Peter David, consulting CFO at CFO & COO Advisory Services. 

“In medium-sized firms, the role has typically evolved to include chief operating officer (COO), responsible for finance, HR, IT, and operations—with a vice president or senior VP of supply chain reporting to the CFO.  

“In other words, they do everything except research and development, marketing, and sales.” 

CFOs have become the chief connect-the-dots officers.  

• They lead the finance controller tasks.  
• They can head up operational aspects such as demand planning, trade management, and sales and operations planning.  
• They lead financial areas such as dynamic planning models and forecasting with rolling time horizons. These tie closely to financial analytics and performance targets and measures. 

8 ways a CFO could help grow your small business

Let’s say your growing business needs more help with finance and strategic planning.  

A CFO could become critical to smooth business operations and financial stability at this point—especially as your firm moves from small to medium-sized. Here’s how a CFO can help: 

1. Strategic financial planning

Your CFO could provide strategic financial planning, ensuring the most efficient use of available funds. They could help budget, forecast future financial needs, and identify areas for cost reduction or investment. 

2. Cash flow management

Your CFO could implement robust cash flow management strategies to ensure your business maintains a healthy liquidity position to meet its operational needs and investment plans. 

3. Risk assessment and mitigation

As small businesses grow, they encounter various risks, including market fluctuations, competition, and financial uncertainties. Your CFO will assess these risks and develop mitigation strategies to protect the business. 

4. Guiding business expansion

Your CFO can evaluate the financial implications of entering new markets or launching new products, advising on the feasibility and potential returns. 

5. Optimizing financial operations 

To improve efficiency and accuracy, your CFO can streamline financial operations, such as accounts receivable and payable. They might bring in software and implement financial controls and processes to help scale your business. 

6. Fundraising and investor relations

CFOs can prepare financial statements, present them to potential investors, and maintain investor relations, ensuring transparency and confidence in your business’s financial health. 

7. Advising on regulatory compliance 

Your CFO can ensure your business complies with financial regulations, tax laws, and reporting standards, avoiding costly penalties and legal issues. 

8. Cross-functional support

A CFO is instrumental in turning strategic visions into operational realities, working closely with other leaders to develop and implement growth strategies where finances are considered at every stage.  

Your CFO can support various departments, ensuring your business has the financial insights and resources to function effectively.  

Alok Ajmera, CEO of Sage partner Prophix, says that the CFO’s relationship with the CEO has always been strong. Expect CFOs to collaborate with other C-suite peers, including the CISO, CMO, and CHRO. 

When your CFO collaborates with leaders of other business-critical areas, it’ll give you better insight into what’s driving your overall performance and where there’s room to improve. 

Alok says: “By collaborating with the CMO, for example, your CFO can better understand marketing spending, conversion rates, and yield to determine where you can implement new measures for increased efficiency.” 

Amy Spurling, CEO of Compt and a former CFO, says CFOs should build strong relationships with HR, as it holds valuable insights into people productivity and retention. 

Aligning your financial and people strategies can help you drive more efficient resource allocation and support your business in a capital-efficient manner. 

Amy says: “HR has incredible insight into your organization’s inner workings—which teams are the most productive, where you struggle to retain people, etc. 

“Your most significant expense is frequently team costs, so by partnering with HR and working together, a CFO can find better ways to support the team in a capital-efficient way. 

“The CFO/CHRO partnership can be a superpower.”

When should you hire a CFO?

As firms get into millions (significantly over $10 million in revenue), they become more complex and need strong leaders in critical divisions like finance. 

However, the requirement for a CFO is often less about company size and more about having a strategic adviser with deep financial expertise on board.  

The triggers for hiring a CFO are different depending on the industry you’re in.  

• A fast-growing technology company may look to hire a CFO after it has raised the first significant round of funding.  
• An experienced CFO could fix supply chain problems in a manufacturer, distributor, or retailer. 
• You might need help with a significant merger or aggressive organic growth strategy.  

As we’ve mentioned, an experienced leader in your finance function can oversee financial transformation, implement new, cloud-based enterprise resource software, or overhaul your financial management and reporting software and financial data and analytics capabilities.  

Peter David, consulting CFO at CFO & COO Advisory Services, says that when to hire a CFO also depends on your business’ complexity and leadership team skills.  

You may not need a CFO if your business model is simple—with few stock-keeping units and no manufacturing or trade issues—and your leadership team has the information and performance management insights they need to run the business.  

“Some mid-sized firms can do fine with a strong financial controller who can lead the budgeting, financial reporting, risk management, governance, audit and review responsibilities,” he says. “Many such companies have CFOs in the title but are controllers with inflated titles.  

“All early-stage companies think they are fast-growing and have a 5-year plan with a ‘hockey stick’ exponential growth projection. When they get to the tipping point of that growth, they need a full-time CFO for operational needs.”  

Early-stage companies might also engage a part-time or interim CFO for fundraising efforts and guidance. However, if you aspire to go public or need to satisfy fundraising or venture capital requirements, you will need more permanent help.  

“Investors typically want a CFO to bring transparency to the company’s performance,” says Peter. “So, the trigger can be when the investors or board call for a CFO as an operational need.  

“If you expect an initial public offering, you will need a CFO to get the governance and reporting in place as most controller-level professionals don’t have the experience to guide that process.” 

What qualifications would a CFO need?

CFOs of larger firms generally have a business degree, an MBA, or an accounting qualification.  

Peter says a certified public accountant (CPA) and or MBA is typically necessary in the US to be CFO of a company with IPO aspirations. The same goes for venture capital or private equity-backed companies.  

These qualifications indicate a grounding in broad business knowledge. However, due to financial reporting requirements in the Sarbanes-Oxley Act, investors and the management team also need a CPA with experience rooted in governance and control to provide confidence in public reporting.  

“A good performance management system should yield good governance,” says Peter. “But having a CPA with audit background also provides more confidence.”  

He adds that broad experience in financial reporting and operational planning may be sufficient for privately held companies.  

What skills are essential for today’s CFOs?

The CFO role has changed dramatically over the last few decades, and their skills need to be much broader and more profound. 

Traditionally, CFO skills have concentrated on financial aspects. Today, they must be more operationally focused and work cross-functionally. In a medium-sized firm, CFOs now typically wear many hats and frequently manage finance, accounting, and legal matters, as well as HR.  

Core capabilities include solid financial reporting skills with a good understanding of generally accepted accounting principles (GAAP) and state and federal laws, such as Sarbanes-Oxley.  

However, they also need broad business knowledge and a talent for analytics and performance management to support a results-oriented culture.  

Increasingly, CFOs need to know more about technology, risk management, supply chains, and environmental, social, and governance (ESG) measures. Data analytics and data quality have become two of the most significant issues requiring CFOs’ attention, so data and analytical skills are also essential.  

Much of the role is now about collaborating with teams across the organization to execute the CEO’s vision. So, CFOs also need good soft skills in presentation, communication, leadership, and negotiation.  

“These days, companies need to be nimble and not in a command-and-control system,” says Peter.  

“The CFO needs to empower the organization with the insights and tools to understand what matters, why it matters, and have the systems and structures to help them achieve clearly defined goals.”  

With all these necessary skills, CFOs are costly. According to salary.com, midrange US CFO salaries were between $318,000 and $534,000 in 2022. However, hiring a CFO is a critical investment for a scaling company to help get them to the next level.

Final thoughts

The CFO role has changed dramatically over the last few decades, and their skills need to be much broader and more profound. 

Traditionally, CFO skills have concentrated on financial aspects. Today, they must be more operationally focused and work cross-functionally. In a medium-sized firm, CFOs now typically wear many hats and frequently manage finance, accounting, and legal matters, as well as HR.  

Core capabilities include solid financial reporting skills with a good understanding of generally accepted accounting principles (GAAP) and state and federal laws, such as Sarbanes-Oxley.  

However, they also need broad business knowledge and a talent for analytics and performance management to support a results-oriented culture.  

Increasingly, CFOs need to know more about technology, risk management, supply chains, and environmental, social, and governance (ESG) measures. Data analytics and data quality have become two of the most significant issues requiring CFOs’ attention, so data and analytical skills are also essential.  

Much of the role is now about collaborating with teams across the organization to execute the CEO’s vision. So, CFOs also need good soft skills in presentation, communication, leadership, and negotiation.  

“These days, companies need to be nimble and not in a command-and-control system,” says Peter.  

“The CFO needs to empower the organization with the insights and tools to understand what matters, why it matters, and have the systems and structures to help them achieve clearly defined goals.”  

With all these necessary skills, CFOs are costly. According to salary.com, midrange US CFO salaries were between $318,000 and $534,000 in 2022. However, hiring a CFO is a critical investment for a scaling company to help get them to the next level.