The professional pinnacle for an advanced accounting student might be the position of chief financial officer (CFO). The CFO is responsible for a company’s finances and advises the chief executive and other executives on money matters.
CFOs must have accounting and finance experience and need leadership, analytical and communication skills. They should be familiar with all the operations of the organization — sales and marketing, manufacturing, purchasing, human resources and other areas — because they all impact the bottom line.
With so much responsibility, the chief financial officer salary can be one of the highest in a company. Pursuing an advanced degree in accounting can help professionals develop the skills and knowledge they need to become CFOs.
What Is a Chief Financial Officer?
The chief financial officer is the top money person in an organization, usually reporting directly to the chief executive and contributing as a member of the leadership team.
The CFO focuses on finance-driven duties such as developing budgets, managing cash flow, borrowing and investing, and planning financial and tax strategies. The goal is to establish financial stability for the company so it can function, maintain resources to invest in new products, enter new markets and weather unforeseen economic storms.
Using accounting and finance skills and experience, the CFO establishes and maintains a financial structure that suits the company and its industry. New companies that want to grow quickly have different financial requirements than mature companies that seek to grow at a steady rate. The CFO manages finances to accomplish the company’s strategy and recognizes when its financial configuration should change.
The CFO works closely with executives who lead other areas of the business, helping provide the resources they need to perform their jobs. With a broad perspective of the company’s activities, a CFO can identify potential savings and determine where further investment could spur growth.
The ability to use technology, especially in the burgeoning field of data science, can help a CFO track and analyze the company’s finances seemingly down to each penny.
As stewards of a company’s finances, CFOs must provide accurate and timely information. They must ensure their company complies with generally accepted accounting principles (GAAP) as well as corporate finance regulations.
Chief Financial Officer Salary
As long as companies deal with money, there will be a market for chief financial officers. The U.S. Bureau of Labor Statistics (BLS) forecasts the annual growth of top executive jobs, which includes the CFO, will average approximately 4% through 2029, on par with the average for all occupations.
The CFO is one of the top officers in a company and usually is paid at a top level. Salary tracking website PayScale.com pegs the median annual CFO salary at about $135,000.
Compensation ranges from about $91,000 for a new CFO to more than $100,000 for a more experienced one (1-4 years’ experience), according to PayScale. With 5-9 years of experience, a CFO averages more than $117,000, while the salaries of senior CFOs range from $139,000 to nearly $150,000.
One trend in corporate structure that could strengthen chief financial officer salary expectations, as well as responsibilities, is the merger of the chief operating officer and chief financial officer roles. A report by the American Accounting Association highlighted the trend and its growth in recent years, particularly among smaller growth firms. The idea behind the trend is the desire to hire more operationally focused CFOs.
Advanced degrees in accounting and finance can bolster an individual’s opportunities in the job market and boost compensation.
How to Become a CFO
A prospective CFO must have command of a company’s dollars and cents, where they come from and where they go. Stints as an auditor, controller or treasurer can boost a candidate toward the CFO office. An advanced degree in accounting also provides a strong foundation for pursuing a career as a CFO.
SNI Financial, a job placement firm for finance professionals, recommends that a CFO also strengthen skills in areas outside of finance. Specific disciplines include data analysis to make sense of increasing amounts of information, strategic thinking to help guide the overall direction of the company and leadership to motivate the finance staff as well as other employees.
A CFO’s communication skills should allow them to clearly explain the concepts and operations of finance to corporate officers and employees who do not have financial backgrounds or functions.
Experience handling finances in different operational areas of a company or several companies can broaden a prospective CFO’s knowledge. Understanding the financial needs of manufacturing and marketing helps endow a candidate with a global view of company operations.
It’s not just their own company with which CFOs should be familiar. Keeping up with industry financial trends and strategies help CFOs make sure their companies are competitive.
Chart Your Course to the CFO’s Office
An online Master of Accountancy degree, such as that offered by the University of North Dakota, can prepare students for the financial complexities of modern corporations and enable their journey to a career in financial leadership.
UND’s program offers two tracks — one that caters to career changers and does not require an undergraduate degree in accounting, and one intended for those with a background in accounting. Both options provide immersive study in advanced accounting concepts, contracts, negotiable instruments, business law, ethics, financial statement analysis, complex transactions and risk assessment.
Explore UND’s online Master of Accountancy and learn how you can further your finance career.