In an ideal world, you would be able to hire the best employees for your company and they’d never leave until they retire. Yet that’s not how it works. Marcie Curry, director of 415 Group’s Alliance location, has advice for companies who find themselves scrambling to fill a vacant chief financial officer (CFO) or controller position—and how to plan ahead.
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. At 415 Group, we can help. Contact us for more information.
© 2023
Before working in public accounting at 415 Group, I was a CFO at various companies. I’ve worked on both sides and understand firsthand the importance of the relationship between public accountants and CFOs. I also know the pain a company feels when an executive-level employee leaves the company.
Thankfully, this pain can be alleviated with a plan. And the plan can provide an opportunity to reset your accounting department or find a better use of your resources. When a CFO or controller leaves a company, finding a replacement or implementing a different approach can take varying amounts of time. The time period will depend on the size of your organization, how well you are prepared, and how you want to actually fill the now-empty role.
Regardless, you can’t rush the process. You want to make sure the new person will be a good fit in both the position and the company. If not, you’ll quickly find yourself working through it all over again, looking for one of the most important parts of your accounting department.
When the CFO or controller leaves, we recommend looking at the accounting department and processes – are there opportunities to promote current employees or adjust job duties?
Consider how you want the structure of your accounting department to flow. If the CFO leaves, are you able to have the controller step up into that position? Or is the CFO a role you would want to hire from outside the company?
If you partner with 415 Group, we want to have a relationship that is more than just filing tax returns. We want to help your organization succeed. When it comes to important accounting personnel leaving, we can reach out to our referral network to help you find a qualified candidate to fill the CFO or controller role. We can also assess the duties of your accounting department and help during the interview process.
Another option in this situation is to use 415 Access, the virtual accounting division of 415 Group. Our Access team can completely replace your internal accounting team. Our team can review financial statements, prepare budgets, analyze data, and help management make financial decisions. It is definitely worth a conversation with our 415 Access division to discuss how best we can help.
A few benefits of this option are the fact 415 Group will have clean, organized books to work from and communication can happen directly across divisions, saving your staff time. You will have a knowledgeable accounting person without all the costs of an employee, like payroll taxes and other benefits.
When a high-level employee leaves, it can also cause some panic and concern within the company and with investors, lenders, and third parties. Communication is the key to assuring them that the executive team has a plan and has already thought about what they will do in this less-than-ideal situation. Remind them you are looking at it as an opportunity to improve the department and potentially the organization as a whole.
It is a good idea to involve the accounting team in preliminary discussions. Find out what their concerns are, their ideas of any duties which need changed, and how best each one of them can help the company deal with this situation. Their feedback may be critical in setting up the next person for success.
This type of major change will happen eventually—it will be hard in the short term, but you can make the transition smoother. Contact 415 Group today to find out how we can help you prepare and ease the burden when a CFO or controller leaves.