Career Spotlight: Chief Financial Officer

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Chief financial officers are integral to the success of many companies. These professionals understand their organization’s current financial state and work to ensure future success. Additionally, CFOs often are in charge of ensuring their company is operating according to the law and fully compliant with any applicable rules.

CFOs often begin their careers in the accounting field. Earning a higher degree is a good first step in becoming a CFO. Students who earn their Master’s in Accounting from the University of Alabama at Birmingham have ample opportunities to develop skills and knowledge that can be helpful in working toward this career goal.

Skills needed for successful CFOs

CFOs are valuable personnel in their organization. To do their jobs successfully, they should have a skill set that allows them to make intelligent, strategic decisions. Some critical skills include:

Financial accounting

A CFO strives to ensure and maintain a company’s financial stability. To do this, a successful CFO must have a strong grasp on financial accounting principles. Earning a Bachelor of Science in Accounting is a good first step, but continuing education and achieving a Master’s in Accounting can help students hone their accounting skills further.

Students working toward their Master’s in Accounting may explore financial accounting in several courses, including:

AC 580: Advanced Financial Accounting
Students will study consolidated financial statements and learn about the complexities of multinational accounting in Advanced Financial Accounting. They’ll also review partnerships and business combinations.

AC 600: Current Topics in Financial Accounting
With an emphasis on research projects and case studies, students will get a close-up view of recent financial statements from authoritative bodies like the SEC and the Financial Accounting Standards Board.

AC 500: Financial Accounting I
This elective course covers accounting cycles, financial statements, the time value of money, and cash and receivables. Additionally, students will look closely at the framework of financial accounting and what it means.

AC 510: Financial Accounting II
This elective course discusses inventories, assets, and intangible assets, as well as long-term debt, stockholders’ equity, and current liabilities.

AC 530: Financial Accounting III
This elective course talks about investments, income taxes, statements of cash flows, employee retirement benefits, leases, selected disclosures, dilutive securities, and earnings per share. It will also discuss accounting changes and error analysis.

Auditing

CFOs should also ensure their organizations are conducting business appropriately and according to all applicable laws and regulations. Knowledge of and experience in auditing is essential for this job duty. Students at the University of Alabama at Birmingham working toward their Master’s in Accounting learn about auditing through courses like:

AC 606: Advanced Auditing and Attestation
Understanding the authoritative bodies that affect auditing practices is key to having a firm grasp of these concepts. This course discusses which entities have an impact on the field of auditing and how auditing has evolved over the years.

AC 513: Internal Auditing
In this course, students will learn about internal auditing theory and practice. They will also review select cases and discuss the auditing principles and techniques to apply to them.

AC 523: External Auditing
Students will learn about the function of external auditing and the standards that external audits strive to meet. Future CFOs can gain valuable insight into auditing through this course, as they may have to work with an external auditor at some point in their careers.

Legal compliance

Companies must follow strict laws that dictate how organizations can handle financial matters. CFOs should stay abreast of these rules and regulations, and know how to ensure their organization is compliant. Students at the University of Alabama at Birmingham will learn about the laws that apply to the accounting field in part through:

LS 557: Business Law for Accountants
Professionals in the accounting field may need to understand the various legal forms of business and what they mean. In this course, students will learn about the nuances of partnerships and corporations. They’ll also discuss sales under the Uniform Commercial Code.

AC 612: Corporate Governance
This course discusses how and why internal and external bodies might seek to control an organization’s activities. These entities may include boards of directors, shareholders, managers, executives, employees, auditors, and the Securities and Exchange Commission, among others.

CFO responsibilities

A CFO’s job duties are plentiful and varied. Some of the most common duties these executives take on include:

Financial reporting

Reporting on a company’s financial state may be the most traditional role of a CFO. It’s up to this executive to review and analyze financial information, draw conclusions about the organization’s financial health, and report that information to key stakeholders, like the president, CEO, board of directors, shareholders, creditors, employees, or others.

Investments and debt management

Every financial decision a company makes has ramifications. The CFO analyzes the potential outcomes of various decisions and weighs the potential for success against the possibility of negative consequences. In doing this, the CFO assists in making strategic investment decisions.

Taking on debt isn’t out of the norm in the business world, but it’s essential that companies manage it carefully. This responsibility falls to the CFO, who understands how holding onto debt can help or harm a company. The CFO determines the best debt ratio for the company’s success and works to maintain or adjust that level of debt as necessary.

Legal and corporate compliance

There are many laws surrounding a company’s financial dealings, and it’s up to the CFO to ensure an organization is doing everything by the books.

In addition to the rules and regulations that are mandated by the government, certain companies may have guidelines that dictate how they handle their money and financial information. Students will learn these concepts in AC 612: Corporate Governance.

Strategize for future success

Just as CFOs are expected to be able to analyze and report on a company’s financial past and present, they’re also counted on to predict an organization’s financial future. This is done through economic forecasting and modeling, and analyzing the many possible outcomes of certain decisions.

UAB’s Master of Accounting program can prepare future CFOs

Young or aspiring professionals who hope to lead a company’s financial efforts may benefit from earning their UAB master’s of accounting degree. To learn more about the University of Alabama at Birmingham’s online degree program, connect with an enrollment advisor today.

Recommended Readings:
Services that could become a staple of accounting in the future
A career in auditing: What it could look like for you

Sources:
University of Alabama at Birmingham Master of Accounting course descriptions
Investopedia
Entrepreneur