A leadership departure in your accounting department can create turmoil, at least temporarily. However, it also provides an opportunity to assess the department’s performance and create a vision for how it should perform in the future. Here are four questions to address if your CFO or controller leaves.
1. Is the job description up to date? During the prior leader’s tenure, the needs of your organization may have changed. Take the time to scrutinize the existing job description and the predecessor’s resume. Then, identify the skills and experience that are essential for the role today.
For example, if you’ve recently taken on debt and need to satisfy lending covenants, make sure that’s a requirement detailed in the job description. Also, if you’ve expanded substantially, you may have outgrown the previous department head. For instance, you might need to replace a bookkeeper with a CPA who has the experience and skills to manage a larger accounting team.
2. Were you happy with your previous level of service? The accounting department is critical to the success of your organization. The department should provide accurate, relevant reports in a timely manner. If not, you may need to consider upgrading your in-house accounting staff and training any remaining employees on the latest tax and accounting rules.
3. Does the department’s technology align with your current needs? Sometimes, organizations can rely less on a key internal person and more on accounting software and their external CPA. If this is the case, ensure you have the latest-and-greatest technology to support your accounting functions and in-house personnel.
Also consider whether you’re maximizing the functionality of your current accounting software. Set up a meeting with a vendor rep to discuss what’s working and what’s not and see how they respond. A worthy provider will address issues, provide training and offer ongoing customer support. If your vendor doesn’t provide adequate support, we can also do a complete assessment on the effectiveness of your accounting system and how you’re using it.
4. How will the demands on the department change in the next two to five years? In-house personnel will need to adapt to new challenges as your organization grows and evolves. For example, if your department intends to acquire or merge with a competitor — or pursue another major strategic investment opportunity — your new CFO or controller will need to have sufficient knowledge to support the effort. Streamlining the department’s policies and procedures can also help to improve its performance and position it for the future.
Finding skilled accounting and finance professionals is difficult for many organizations, especially smaller ones. An interim or outsourced CFO can provide an objective, flexible, and cost-effective approach to running the accounting department on a temporary or permanent basis. With the right professional in place, you can ensure that your accounting department continues to operate at a high level, despite the challenges posed by a leadership change. Contact us for more information.
This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, accounting, legal or tax advice. The services of an appropriate professional should be sought regarding your individual situation.