In one of the toughest jobs in the business world, Chief Financial Officers (CFOs) are senior executive-level managers who oversee the financial activities of an entire organization. By poring over complex financial reports, CFOs analyze their company’s strengths and weaknesses to make necessary improvement plans that will boost overall profitability. CFOs play a prominent role in the multidisciplinary upper-level management team for being the company’s steward, operator, strategist, and catalyst for action. As the dynamic global business marketplace grows even more competitive, organizations are more dependent on their CFOs to deliver forward thinking and fresh insights for protecting and improving financial integrity.

Salary

According to the Bureau of Labor Statistics, the 248,760 chief executives running organizations across the United States earn an average annual salary of $178,400, which is equivalent to a whopping $85.77 per hour. In particular, the American Institute of Certified Public Accountants (AICPA) has reported that the average salary for CFOs is $160,000 at private corporations and $180,000 at public companies annually.

Beginning Salary

When first landing the job title of CFO, individuals should expect to earn an average yearly wage of around $75,030. While this seems low for a top-level executive position, it is important to remember additional years of experience as CFO can eventually lead to making $212,570 or even surpassing the quarter-million mark each year!

Key Responsibilities

With their seat on the company’s board of directors, the CFO is given the hefty responsibility of coordinating effective financial, accounting, and tax strategies to improve the company’s value in the marketplace. CFOs are responsible for making every decision involving money for an organization to ensure that each campaign or project will be financially productive. CFOs are in charge of presenting accurate financial information to company executives, reporting data to shareholders, determining the best company investments, managing risk, overseeing the capital structure, and addressing all internal financing problems. CFOs also must conduct economic forecasting to project the company’s long-term financial picture and ensure continued success into the future.

Necessary Skills

In their top executive position, CFOs must possess strong communication skills to effectively discuss issues with other managers, negotiate with shareholders, and direct subordinates in the financial department. Chief Financial Officers are involved in creating the financial plans for an entire company, so solid decision-making and critical thinking skills are a must. Leadership, management, and problem-solving abilities should be very strong for CFOs to successfully identify issues within the organization as well as carry out innovative solutions. Since CFOs are responsible for completing their duties under their own direction, time management skills are important to ensure all work is completed efficiently and company goals are met. Analytical skills are also necessary for managing and modifying the company’s financial systems in compliance with international financial reporting standards.

Degree and Education Requirements

Although exact requirements will vary from company to company, all CFOs must have at least a bachelor’s degree from an accredited institution with years of financial experience. Aspiring CFOs should earn a four-year undergraduate degree with a major in finance, business administration, management, accounting, economics, or mathematics. From there, it is highly recommended that CFOs continue on to graduate business school to complete a Master of Business Administration (MBA) in Finance, Master of Science in Finance (MSF), or even Master of Accountancy (MAcc) for the highest probability of promotion. It is best to focus on courses that will enhance knowledge and skills in overseeing the financial aspects of a company in preparation for this advanced executive position.

Pros and Cons of this Position

Chief Financial Officers hold the highest ranking financial position in a company, so they are very well-compensated with a high salary, bonuses, stock options, and benefits. CFOs also have the advantage of finding employment options in private businesses, government agencies, non-profit organizations, and the public sector to steer the direction of the financial department. As with any other career, the CFO title also comes with some drawbacks though. Since CFOs are often held accountable for poor financial performance, this job delivers a large dose of stress and pressure in a highly competitive market. In fact, continued employment for CFOs will likely depend on their organization’s overall financial performance. Most CFOs also must invest at least a decade of management experience, work long hours beyond a 40-hour workweek, and perhaps relocate their home to receive this role.

Getting Started

After earning an appropriate education with a strong background in finance, aspiring CFOs will need to get started on their career path by obtaining related work experience. Most executives will advance within their own organization to move from lower-level managerial positions into the desired upper-level management roles. Before being hired as the CFO, most professionals will need to accumulate ten or more years of managerial experience. In hopes of advancing, you should take advantage of every opportunity to participate in executive development programs, company training workshops, and certification courses to boost credentials. Many publicly traded companies will also prefer to promote CFOs who have become Certified Public Accountants (CPAs) for their ability to sign off on audits with the U.S. Securities and Exchange Commission (SEC). Therefore, you will need to complete 150 credits of post-secondary education and receive a passing score on the four-part Uniform CPA examination.

Future Outlook

As our nation’s economy continues to pick up steam after the recent recession, it is projected that there will be growth in the formation of new organizations and expansions of existing companies. As a result, there will be a rising demand for CFOs to direct the financial operations of these growing companies to ensure continued financial success for the long-term. The Bureau of Labor Statistics currently predicts that the employment of CFOs and other top executives will grow by 11% before 2022, which will create around 261,500 new jobs. However, it is important to remember that CFO hopefuls will be facing very strong competition for jobs because the position’s salary and prestige attracts many qualified applicants.

Overall, Chief Financial Officers are busy at work overseeing the finances of organizations in virtually every industry of the economy, from retail and transportation to medicine and manufacturing. CFOs are essential top-level executives who utilize their strong background in finance to pursue positive business ventures, prepare accurate financial reports, communicate with other members of the management team, and work diligently to guarantee the maximum growth of their company.

Another excellent resource:

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