How to grow your Business

Everything you need to know about hiring a CFO

Valentina GolubovicValentina Golubovic
Last updated on:
August 21, 2022
Published on:
April 28, 2022

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As a business owner, you have many responsibilities and probably not enough hours in the day to get everything done. Hiring a chief financial officer (CFO) can help you with the financial management of your company, freeing up your time to focus on other tasks.

What is a Chief Financial Officer?

CFO manages all aspects of financial matters and decision making, ultimately responsible for the company's financial health. They help compile financial reports and oversee cash flow management and general financial planning and operations of an organisation.

Importance in hiring a CFO?

CFOs can help implement a financial strategy to cut costs, grow revenue, and ensure financial control in the business. They can identify ways of improving profitability and ensuring that cash flow is robust enough to withstand any unforeseen events or economic uncertainty. 

The CFO should be aware of any regulatory requirements that influence financial reporting. They are responsible for ensuring compliance with these regulations on behalf of the organisation, avoiding potential reputational damage.

A CFO's duty requires them to keep abreast of accounting standards. CFOs should adhere to best practices when preparing financial statements and provide accurate information that investors will trust. Financial statements must show a true and fair view of the business. If not, it can impact the financial planning and day-to-day operations, leading to liquidity issues and failure in the long run.

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Steps to Hire a CFO

Write a job description

Clearly outline responsibilities and requirements for the role. You'll need someone with a high level of accounting and finance expertise, industry experience, strong communication and presentation skills, and substantial strategic planning acumen. Furthermore, knowledge of various accounting systems can be advantageous. Soft skills are crucial in an effective CFO as they will be a vital member of the team and have a financial leadership role in your company.

Finding a candidate

Post the job on social media and networking sites and reach out to people in your network for recommendations or suggestions. Given the role-specific complexities of the position, it may be best to get a recruiter to help with the hiring process.

Interview process

Think about the experiences and qualities you want in your CFO and ask the relevant questions to gauge the candidate's suitability. Ask how they have dealt with complex financial matters, motivations, and critical thinking skills. Leadership and ethics are essential characteristics of a board-level member. Consider asking the candidate how their past performance demonstrates these skills.

Find out what the candidate wishes to get out of this role to judge if the position will be motivating for them. You must build trust in the relationship with your CFO, given the importance of their role. It is always helpful to get a second opinion from someone else in the business to assess a candidate's suitability and culture fit.

Extend the job offer 

Send an offer of employment to your chosen candidate. The offer letter will cover what the employee and employer will want to agree on, define both parties' obligations and rights, and outline any particular key terms.

Get your paperwork inline

Once the ideal candidate has accepted the offer, it is time to draft their employment contract.

Legislate can help you create lawyer approved contracts on no legal budget.

To create your employment agreement:

  1. Create a Legislate account and select the employment agreement from the list of available contracts.
  2. Set the terms of the agreement and invite the employee to e-sign the contract directly from Legislate.
  3. Watch a Legislate tutorial on the employment contract creation process.

The opinions on this page are for general information purposes only and do not constitute legal advice on which you should rely.

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