The CFO'S Perspective

The Chief Financial Officer (CFO) position is an important component in the success of any company. A capable CFO takes the time to understand the financial operations of his/her own company, as well as the company’s position in the industry. That knowledge informs vital strategic financial decisions that are often the primary drivers of business growth.

However, the costs associated with a CFO role typically put it out of the reach of many small businesses and startups. Some companies choose to forgo a CFO altogether, opting to let the head of the business make the financial decisions with the help of a CPA, accountant, or other less experienced financial professional. Much like taking a road trip without turn-by-turn GPS directions, this route may result in poor financial management that leads the company astray.

We recently covered the cost of tax compliance in this recent article.  The costs are a direct result of how companies face a myriad of tax compliance issues, even in the wake of tax reform that is supposed to boost bottom line results. The top ten federal tax compliance issues for businesses haven't changed much in the wake of this reform. These are:

We are privileged to provide our clients with the best finance experts in the region. Not only are they experts in the field, they are also authentic, caring and generous people. We want to honor them by giving you the opportunity to get to know them a bit better.

Our firm is well known for our philanthropic contributions to our communities.  One of our core values centers on philanthropy.

Even small companies have an obligation to re-invest in the communities where they earn their living,”  
- Tom Varga, CFO Selections Founder

What you may not know is how our team goes even further by giving of their own time and talent after hours. The stories of their causes are below.

We are continuing on the topic of tax compliance from the previous article.

If there is one thing most of us can agree on, it is that this nation's tax code is complicated! In 1955, the Internal Revenue Code was just 409,000 words, which already sounds daunting. By 2017, it had ballooned to nearly six times that size, clocking in at over 2.4 million words. According to the Tax Foundation, there are also roughly 60,000 pages of tax-related case law that are vital to understanding this nation's tax code.

The hardest thing in the world to understand is the income tax."
- Albert Einstein

Every business is required to file tax returns and make payments on income at the state and federal level. While each organization has its own requirements, ignorance of the rules is not an excuse for non-compliance.

Not only is it vital that a company dedicate resources to federal tax compliance, it is also costly. Since tax rules tend to change frequently, there is a high risk of mistakes as well as the potential to miss opportunities, both situations that could hurt your company's bottom line.

Make sure you pay your taxes; otherwise you can get in a lot of trouble."
- Richard Nixon

In years past, a company's financial leader was largely disregarded when it came to strategic planning. In fact, many CEOs believed that a solid group of accountants could negate the need for a CFO altogether. Fortunately, these ideas have evolved.

Your company may have the most ground-breaking products or services and eye-popping marketing campaigns, but this is not enough to ensure financial success. This requires a closer relationship between the CEO and CFO, as well as the supporting roles within your company's finance team.

When business disruptions occur, it can be expensive. Most business owners and CEOs have a model for success in mind, but what about the other side of the coin? Failing to prepare or put contingencies in place for unexpected events can turn a potential blip into a catastrophe.

Increasingly, business owners and leaders are leaning more on their financial teams to help prepare the company for uncertainty. Specifically, the business's CFO is taking on a broader role that includes making sure that your firm will be able to weather unexpected events.

A CFO is responsible for budgeting and accurate cash flow projections. While not necessarily an HR expert, the matter of salaries and raises is an area that a CFO must navigate in collaboration with the company’s HR team. We are sharing our thoughts on this area from a CFO’s perspective.