Why the CFO Should Be a CPA -- Or Not

by Cesar Bacani, 06 July 2011

0 comments

Facebook

Digg

Twitter

topics:
Management

tags:
business partnering catalyst compliance operator steward strategist

What happens when you bring together a bunch of articulate senior finance and other corporate executives, management consultants and area specialists from academe and the Singapore government?

You get a lively – but civil – debate.

“You want to be an auditor, you have to be a CPA,” said one participant at a recent roundtable organised by CFO Innovation in association with CIMA, the Chartered Institute of Management Accountants.

“You want to be a doctor, you need to have a qualification. At some point in time, the CFO industry will have to regulate itself. What is a CFO? Who qualifies to be a CFO?”

“But why do we care?” a CFO countered. “We don’t regulate the CIO or the CEO. It’s just a role in business. It’s not a qualification. How many CFOs are running IT, for example?”

“I don’t think there’s a CFO industry,” said a management consultant. “I don’t think you can put the role of the CFO into a straitjacket. It depends on the nature of the business, on your service delivery model.”

“But I think CFOs should have a decent appreciation of finance and accounting,” argued another finance chief. “If you’re a great business partner, but you have a blow-up in finance, you’ll lose your job. Appreciation of fundamentals is very important.”

“I agree, but I think it is very hard to make this structural and tie it back to qualifications,” said yet another participant. “I think, as a baseline, it is recommended that CFOs should know accounting. But you should never get to a point where you legislate that a CFO must be a CPA.”

Bumpy Road

The two-hour roundtable in Singapore on April 29 tackled one of the hottest issues in CFO circles today. In conferences and informal gatherings, the buzz is around the expansion of the finance function from transactions processing, accounting and compliance to value-added areas such as analytics, strategy setting and business partnering.

For multinationals like Bank of America Merrill Lynch, that journey is already well under way. “I see myself as a completely transformed finance person after roles in product origination, product sales and business strategy from the days when I first joined the bank,” said Naveen Agarwal, the bank’s Head of Finance for Global Wealth Management, Asia and India. “My business partners expect me to work around [those] full lines.”

For some others, the journey is just beginning. “This is pretty new to our company,” said one finance chief who looks after seven countries across Asia. “We’re not there yet, but we’ve got to do it.”

According to this CFO, “some in the business regard the idea of finance being a business partner as a threat and source of interference.” Finance is also hamstrung by deficiencies in soft skills. In recruiting additional staff, this CFO is discovering that many finance professionals “lack talent, in terms of communications skills, interpersonal skills, managing conflicts, negotiation skills and presentation skills.”

Comment on this article

Your name: *

E-mail: *

The content of this field is kept private and will not be shown publicly.

Homepage:

Comment: *

Web page addresses and e-mail addresses turn into links automatically.
Allowed HTML tags: <a> <em> <strong> <cite> <code> <ul> <ol> <li> <dl> <dt> <dd> <a> <p> <span> <div> <h1> <h2> <h3> <h4> <h5> <h6> <img> <img /> <map> <area> <hr> <br> <br /> <ul> <ol> <li> <dl> <dt> <dd> <table> <tr> <td> <em> <b> <u> <i> <strong> <font> <del> <ins> <sub> <sup> <quote> <blockquote> <pre> <address> <code> <cite> <embed> <object> <strike> <caption>
Lines and paragraphs break automatically.
Use  to create page breaks.

More information about formatting options

Verification Code

This question is for testing whether you are a human visitor and to prevent automated spam submissions.

What is the fourth word in the phrase "ukeni ibolixo rakofu fowofi oqug"?: *

Accounting and Regulations

CFO innovation Asia Accounting and Regulation the Asia Pacific resource center for senior finance executives, daily news, analysis, best practice and case studies in Accounting Regulation, IFRS, US GAAP, Tax, investor relations, corporate governance, Corporate Law, Financial Regulators, Internal Audit, Audit, Corporate Law.

Auditing, Investor Relations, Law and Compliance, Tax

Finance and Banking

CFO innovation Asia, Finance and Banking the Asia Pacific resource center for senior finance executives, daily news, analysis, best practice and case studies in Corporate Finance, trade finance, treasury and risk management, capital expenditure, Banking, mergers and acquisitions

Cash and Liquidity Management, Corporate Finance, Insurance, Treasury Management

Management

CFO innovation Asia the Asia Pacific resource center for senior finance executives, daily news, analysis, best practice and case studies in Finance Management, Corporate Governance, Human Resource Management, Compensation and Benefits, Mergers and Acquisitions, Professional Development, Corporate Real Estate, Risk Management, Budgeting and Forecasting, Business Process Management, Business Process Reengineering, Outsourcing.

Budgeting and Planning, Business Expense Management, Human Capital Management, Outsourcing and Shared Services, Risk Management

Metrics

Corporates, Financial Services

Technology

CFO innovation Asia Technology the Asia Pacific resource center for senior finance executives, daily news, analysis, best practice and case studies in Finance Systems, Business Intelligence, EPR, Accounting software, CRM, Cloud Computing, Telecommunications, Business Process Outsourcing, Business Process Management Software.

Business Intelligence, Enterprise Software and Systems, Financial Systems, Security