What is a Fractional CFO?
What does a fractional CFO do?
- A CFO is responsible for a company’s past and present financial situation and is an integral part of a company’s management and financial future.
- A CFO has multiple duties, from financial reportage to deciding where and when to invest company funds.
- A CFO oversees the capital structure of the company, determining the best mix of debt, equity, and internal financing.
- Addressing the issues surrounding capital structure is one of the most important duties of a CFO.
What are the Fractional CFO roles?
The Major Components of a CFO’s Job are:
These make up the backward-looking part of a CFO’s job. Controllership duties hold the CFO responsible for presenting and reporting accurate and timely historical financial information of the company. All stakeholders in the company, including shareholders, analysts, creditors, employees, and other members of management, rely on the accuracy and timeliness of this information. It is imperative that the information reported by the CFO is accurate because many decisions are based on it.
The CFO is also responsible for the company’s present financial condition. They must decide how to invest the company’s money, taking into consideration risk and liquidity. In addition, the CFO oversees the capital structure of the company and manages the changes in the “capital stack”, determining the best mix of debt, equity, and internal financing. Addressing the issues surrounding capital structure is one of the most important and sensitive duties of a CFO.
Economic strategy and Forecasting
A quality CFO is responsible for a company’s past and present financial situation, they are also a key player in a company’s future growth potential. A CFO must be able to identify and report what areas of a company are most efficient and how the company can capitalize and take action on this information with the resources available.