It’s no secret that the primary goal of every business is to make a profit, and that’s where the role of the chief financial operator (CFO) comes in. Contrary to what many people recognize, however there is much more to the title of CFO than simple financial responsibilities. Today, the world of finance and accounting moves much faster than it ever did before and it can be difficult to decide which areas are more critical to focus on. From industry demands to workforce evolution and technology change, a successful accounting team requires a comprehensive software that will evolve with the changing demands and job functions of the CFO.
Common CFO Challenges
Today’s accounting world and technological advancements are ever-evolving, meaning that the challenges facing CFOs are often overwhelming to focus on. Here are four of the biggest CFO challenges and how a startup business software can help combat them.
There is no doubt that digital transformations are bringing both new obstacles and opportunities for CFOs. With an increased focus on cybersecurity, compliance, and liability, the need to adjust digitally cannot be understated, otherwise a company’s CFO risks poor performance by not being able to juggle multiple roles or be agile to and responsible to digital transformation needs.
Disparate Systems and Data
Another challenge for today’s CFOs involves the abundance of systems and solutions that are utilized in order to meet a company’s evolving needs. While these tools may be necessary to support the CFO as the technological world becomes more advanced, multiple systems can mean that all your company’s pertinent information is scattered across many different places.
Talent Hiring and Retention
Most companies are well-aware of the fact that the coronavirus pandemic has changed business structure and hiring practices around the world. Remote work has become the new norm and there is little evidence to indicate that this type of work will be fading away, especially when it has shown to reduce operational costs and improve productivity and performance. In order to remain ahead of the competition in terms of talent hiring and employee retention, CFOs need to find a way to reimagine a new work structure that prevents burnout for remote workers.
Traditional Financial Challenges
On top of these modern challenges, CFOs are simultaneously tasked with age-old accounting issues such as inflation, cost reduction, increased productivity and efficiency, management of taxes and other regulatory data, and cash flow management. These issues are not only impacted by growing and evolving technology but also by global and economic uncertainty.
Automatic Multi-Entity Consolidation and Real-time Data
The challenges presented are ones that a CFO of any organization must work to overcome, but these challenges may be exponentially more difficult to combat for CFOs of companies with multiple entities or multi-jurisdictional subsidiaries. Multi-entity accounting means that the parent company’s CFO must be able to see the financial pictures of the entire company as a whole, including the details of each individual subsidiary.
If this sounds convoluted, that’s because it often is. The more that a company grows and expands into new regions, services, or products, the more complex the accounting becomes. This is especially true if each subsidiary works on a different software that cannot be accessed by other teams or the CFO in real time, creating data silos that reduce efficiency because extra work must be done in order to locate necessary data.
A lack of financial transparency can also lead to a bad organizational reputation among stakeholders and shareholders. This can negatively impact funding rounds and the company’s short-term and long-term goals.
Benefits of Multi-Entity Management Software
While during the pandemic, you may have been able to keep up with the technology and software that was needed to push onward, there is so much more you should aim for in today’s post-pandemic business world. Today, your company can thrive with an automated entity management software that streamlines processes, accelerates business growth, increases productivity, and tracks key performance metrics and compliance statuses.
Not only does this benefit the entire company, but this type of software helps the CFO gain the most value from day-to-day business functions. Your company’s top accounting executive can easily see where the company as a whole is spending money without having to scour through disorganized filings and do so on a system that each employee works through.
Athennian is a modern business entity and subsidiary governance platform that powers teams to be transaction, audit, and compliance ready. Legal, finance, and tax professionals use Athennian to automate workflows for ownership, governance, tax, and corporate compliance.
For more information about the benefits of working with modern entity management software, please don't hesitate to contact the Athennian team to request a custom demo with our experts.