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CFO employment agreement

George  Yap's Profile

Please list the current duties and responsibilities of a CFO for mid-cap listed company on Nasdaq or equivalent. What will be today's top 10 responsibilities of a CFO? What are benefits and compensation package? Who do the CFO reports to?

Answers

Ben Murray
Title: Vice President and CFO
Company: Cartegraph
(Vice President and CFO, Cartegraph) |

The duties are numerous but to get it started...

Forecast cash.
Establish daily bank reconciliations (may not need daily)
Review payables.
Review collections.
Review any debt agreements.
Review capital expenditures.
Establish metrics.
Create sales report.
Create monthly management/flash report.
Review insurance policies.
Revise management reports.
Review finance policies.
Create budgeting/forecasting process.

Benefits/comp - medical/dental/401k/etc, base + bonus and equity
CFO usually reports to CEO.

Jonathan Turkel
Title: Managing Director
Company: The Telmarc Group Inc.
(Managing Director, The Telmarc Group Inc.) |

A good way to get an idea about the compensation and benefits packages of public company CFOs is to search the SEC files for companies you believe are comps. to your company. SEC rules require the filing of material contracts . You can search a company's SEC files for that contract ( the contract will almost certainly be an exhibit to a registration statement , usually Form S-1 , a Form 10K or a Form 8K (if one was filed when the CFO was hired). I would start by looking at the list of exhibits to a company's last 10K. That list should include the CFO's employment agreement and the name and date of the filing in which the contract was originally filed. Also a summary of the terms of the contract should be contained in the "executive compensation "section of either the company's 10K or Proxy Statement.The duties of the CFO should also be spelled out there, but this information often is generic.

Topic Expert
Wayne Spivak
Title: President & CFO
Company: SBAConsulting.com
LinkedIn Profile
(President & CFO, SBAConsulting.com) |

If I were to sign a contract to be a CFO, do I want all the duties listed?

That could be limiting the job or expanding it. Based on verbiage it could be cause for dismissal.

I would not want the job description to be anything other than CFO or additional qualifiers about Standard Practices of a CFO.

Since there are no code of ethics (other than legal requirements [more for listed companies]) I would shy away from clauses that talk about this.

As for compensation, reporting it all depends on what you as the CEO wants (most, but not all CFO's report to the CEO, some to the COO, very few directly to the Board; assuming there is no PE or VC onboard, then most report to them and the CEO, since they are the Board).

Topic Expert
Malak Kazan
Title: VP, Special Projects
Company: ERI Economic Research Institute
(VP, Special Projects, ERI Economic Research Institute) |

I would add in selecting data from SEC filings, pick those with similar size revenue and industry. These are two key variables highly correlated with compensation levels for executives. Hope this helps.

Topic Expert
Mike Caruana
Title: Director of Financial Services
Company: Diamond Resorts International
(Director of Financial Services, Diamond Resorts International) |

As the others mentioned, the SEC filings will give you a good placeholder for compensation. As it relates to duties and responsibilities, an essential read for finding out what really matters is IBM’s 2013 Global C Suite Study (particularly the extraction related to CFOs.) They interviewed 576 CFOs (102 in North America) and came away with tremendous insights.

The first crucial insight regarding superior CFOs was identifying what they termed “Value Integrators” . These were CFOs who excelled in 4 distinct areas: Performance Optimization, Predictive Insights, Enterprise Risk Management and Business Decision Making. Their organizations proved to be 38% more successful than other finance organizations as measured by revenue and profits, compared with the results from IBM’s 2010 survey.

The second crucial insight had to do with further drilling down into the performance of “Value Integrators”. They found a subset of superstars they called “Performance Accelerators”. As good as the Value Integrators were, this group was significantly better. Although neck-in-neck in terms of efficiency, these Performance Accelerators blew past them in 11 areas. That’s what differentiated the top CFOs from everyone else.

I highly recommend going to their website and digesting this report. You can find the link at the bottom of their homepage (www.ibm.com) under ‘Information For >> C-suite executives’.

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