Can CFA designation lead to being a CFO of any business firm. How do we compare this with CA
I’ve been volunteering with thte CFA Society of Phily for about a year. Most of the members I run into are either VP or own their own company.
Nearly every CFO I’ve seen has started as a partner at a big 4 accounting firm. CPA > CFA in this case.
Even if all CFOs are CPAs, it doesn’t mean than getting a CPA makes you likely to become a CFO.
Being a CFO, you’d better be very solid on your accounting. You’ll have your minions on doing the books and making the consolidated financials, but you’ll need it if say your company is doing any merging/buyout/restructuring and be pretty sensitive on accounting treatments for reporting purposes. CFA just doesn’t have the debt in financial statement analysis.
That’s my career goal (public firm CFO). A CFO has three main areas of responsibility: a) Controlling and Reporting b) Management of firm assets (especially cash flow) c) Capital strategy You’re ultimately responsible for the preparation of GAAP - compliant filings and timely preparation of tax returns. You’d also need to do the day-to-day managerial accounting tasks like payroll and annual/sales/capex budgeting. A strong internal audit department is critical, and would likely fall in your division. Under the Treasury functionality, you’re going to have to keep a keen eye on cash flows, and make sure that there’s always enough liquidity for capital projects. You’ll likely coordinate with outside investment firms and portfolio managers to ensure you’re using your cash and capital resources wisely. However, a good CFO is more than just a competent books guy. You’ve got to be able to manage the company’s credit lines, opine competently on potential M&A developments, and provide strategic feedback to the management and operations teams on how their proposed actions affect the bottom line. A CPA is essential for part a and b. You really can’t run a firm’s accounting department without a thorough knowledge of how to prepare every entry from scratch. I can also see a CMA being extremely useful. However, I really believe the CFA charter can be an important asset for a CFO. It can help with the management of an investment portfolio (even if you’re not doing it on a day-to-day basis, asset allocation is very important). It can also help out with larger strategic goals like a company that’s in an M&A prone sector. If a company has a solid controller and is looking for a non-traditional CFO that can provide some good feedback to the management team, a charterholder may help fit that roll.
Level2Relief Wrote: ------------------------------------------------------- > That’s my career goal (public firm CFO). > > A CFO has three main areas of responsibility: > > a) Controlling and Reporting > > b) Management of firm assets (especially cash > flow) > > c) Capital strategy > > You’re ultimately responsible for the preparation > of GAAP - compliant filings and timely preparation > of tax returns. You’d also need to do the > day-to-day managerial accounting tasks like > payroll and annual/sales/capex budgeting. A strong > internal audit department is critical, and would > likely fall in your division. > > Under the Treasury functionality, you’re going to > have to keep a keen eye on cash flows, and make > sure that there’s always enough liquidity for > capital projects. You’ll likely coordinate with > outside investment firms and portfolio managers to > ensure you’re using your cash and capital > resources wisely. > > However, a good CFO is more than just a competent > books guy. You’ve got to be able to > manage the company’s credit lines, opine > competently on potential M&A developments, and > provide strategic feedback to the management and > operations teams on how their proposed actions > affect the bottom line. > > > > A CPA is essential for part a and b. You really > can’t run a firm’s accounting department without a > thorough knowledge of how to prepare every entry > from scratch. I can also see a CMA being extremely > useful. > > However, I really believe the CFA charter can be > an important asset for a CFO. It can help with the > management of an investment portfolio (even if > you’re not doing it on a day-to-day basis, asset > allocation is very important). It can also help > out with larger strategic goals like a company > that’s in an M&A prone sector. If a company has a > solid controller and is looking for a > non-traditional CFO that can provide some good > feedback to the management team, a charterholder > may help fit that roll. AGREED
Hey what a coincidence! I’ve been volunteering for the CFA Society in Philly as well! Will you be at the Career Development Event?
Many CFOs do not have CFAs. Who knows, that might change given the age of current CFOs, the CFA was not as popular then. But, Accounting is definitely the top (as well as Corporate Finance). Their job also heavily entails selling their company’s story, and future financial returns (which heavily relies on accounting and corporate finance) which entails financial engineering as well as understanding and even leadership roles in the knit and grit of business operations (vs analysis). CFA related experience and candidates from what I have seen do not generally fit that profile, therefore I would I have to believe it will continue to play a diminished role.