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Are you a Chief Financial Officer or Bookkeeper? |
Many business officers holding the title of CFO are really bookkeepers. This is dangerous for the institution and for the employee. An institution hiring a CFO should receive high-level financial management. An unqualified CFO puts him/her self in a precarious position if all he or she is doing is record-keeping and reporting when your employer is looking for much more than that. An institution of higher education requires solid, strategic leadership; this requires much more than a bookkeeper can or should provide.
What's the difference?A chief financial officer is responsible for:
Milestone Advisors says, "...a CFO takes on a broader role in planning for the current and future financial needs of the business." CFO Edge says, "While the primary function is to look ahead, the CFO must also be able to understand past financial performance in order to accurately predict the organization's financial future. A bookkeeper is responsible for:
CFO Edge says, "The primary function of the [bookkeeper] is to maintain and operate the books and records of the business, looking back at data already generated." The Overture Group says, "A [bookkeeper] is typically the day-to-day manager of the tactical accounting issues." A chief financial officer is a critical role in any institution of higher learning.In the absence of a true CFO, key responsibilities are delegated to inexperienced lower level employees resulting in missed opportunities and reactive decision making. Alternatively, senior administrators (typically the president) assume the duties of CFO in their "spare time". We must ask, then, if the president is performing the role of CFO, who is performing the role of president? It is not realistic or advisable for a president, or anyone else, to tack on CFO responsibilities to their schedule. Each of us are limited to the same 24 hours in a day; something will have to give. A president's role is vital - if a president is taking even a part of their day to perform CFO responsibilities, those hours, which should've been spent on presidential matters, are wasted. An institution cannot reach its full potential without a true CFO. A quality administrative team requires experts in all areas of higher education management, including financial management. A bookkeeper's role is to look back. A chief financial officer's role is to look forward. All institutions REQUIRE the services of a true CFO. Without it, the institution is guaranteed failure. Why do institutions settle for a bookkeeper when they really need a CFO?Lack of perceived need. Current staff is "doing a great job." We can't afford it. Making the transition to chief financial officer.If you are an institution looking for a new business officer, gain a deep understanding of the needs of the institution, the roles and responsibilities demanded of your leadership, and hire effectively. If you are an institution who hired what you thought would be a CFO but you've discovered you really have a bookkeeper, you have a responsibility to your employee. Your employee accepted the position on good faith. If you didn't really understand what you actually needed, that's not your employee's fault. You will need to work closely with your current employee to either bring them up to speed by providing clear expectations and the training to achieve those expectations, transition your current employee to someplace else in the institution, or work with the employee to find other employment without jeopardizing their career, their budget or their family. If you are an employee that wants to be (or already should be) a true CFO:
Resources for becoming a true Chief Financial OfficerABACC provides many resources to develop the CFO:
NACUBO also provides resources for the CFO:
Additional resources:
References
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2019 ABACC Conference Registration (Attendee)
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2019 ABACC Conference Registration (Exhibitor)