Whether or not money management is your strength – or even an interest – if you’re like many small-business owners, you probably handle your business finances. That’s because many small businesses aren’t quite ready to hire a chief financial officer (CFO).

But owner and CFO are two very distinct roles. In a Korn Ferry CEO/CFO study of Forbes 2000 companies, only 13% of CEOs moved to this top position from the role of CFO. CFOs tend to be linear thinkers and owners tend to be big picture thinkers, but there are traits the two roles have in common that can make you successful at both.

For example, owners often have a strategic mindset, launching and growing an idea into a thriving company. This outlook can make you better at managing finances if you focus on strategizing the dollar signs behind the big ideas.

Owners are also good at aligning strategy execution with their priorities by identifying the most important next steps to take to grow a business. As the CFO, you can use the same mindset to fund your priorities and maintain the financial health of the business.

Finally, owners are usually effective decision makers. In fact, a good portion of an owner’s day is spent making decisions about operations, employees, goals, marketing, and more. As CFO, you’ll also need to be an effective decision maker. It’s critical to stay on top of your spending and income, making smart choices that maximize cashflow.

Some traits of a good owner include being a big picture thinker, people person, and motivator, while some traits of a good CFO include being a linear thinker, numbers person, and communicator.


Stepping into the role of CFO

As the owner, you can bring big picture thinking and a leadership mindset to your CFO duties by prioritizing tasks that need to be completed on a regular basis.

Record-keeping and reporting: Accurate bookkeeping is the foundation of your business’s financial health. Your records can also reveal a lot of information to help with planning. It’s important to put good systems in place, especially if you don’t consider yourself a “numbers person.” Accounting software can be integrated with your online banking platform, giving you a dashboard view of your accounts and financial health.

Pricing: owners are often in tune with their market and the demands of their customers. As CFO, you’ll also need to be adept at implementing pricing strategies that take into consideration overhead and costs to maximize profits. Delving into your finances will help you determine your most profitable products and customers. This information can inform your decisions going forward, especially as you create marketing strategies.

Budgeting: Knowing where to spend your money is key to maintaining profit margins and expanding your business. According to a survey of CFOs by McKinsey & Co., 43% said they needed to streamline their overall budgeting processes to react more quickly and efficiently to the changes in the market. Your budget will be an estimate of costs and revenues for the year, which helps you manage and achieve your financial goals.

Forecasting: CFOs also review past performance to predict a company’s financial future and determine if they can meet or exceed the expectations outlined in the budget. The pandemic made forecasting more difficult. According to the McKinsey & Co. CFO survey, 65% of respondents said they planned to use rolling forecasts in 2021 and beyond. You can adopt a similar process, continually reviewing your forecasts.

Key tasks of a CFO: Record keeping, reporting, pricing, budgeting, and forecasting


Adopting CFO best practices

Now that you understand your role, you can make it easier by leveraging the standard practices and tools CFOs use. First is a bookkeeping system, which serves as the center of your finances. Yours should offer a way to organize your receipts and bank statements. You’ll also want to categorize transactions in your bookkeeping system, which can help you with your budgeting and forecasting responsibilities and prepare for taxes.

Accounting software is your best friend. It can provide the foundation for a bookkeeping system, and it can allow you to reconcile your business accounts. Some popular options include QuickBooks®, Xero®, and Quicken®. No matter which you choose, accounting software can streamline your record keeping and reporting, generate financial reports, and track expenses. Accounting software will also help you with your budgeting, pricing, and forecasting functions.

Online banking is the easiest way to manage your money. Use the platform to pay your bills and payroll. You can send digital invoices to collect accounts receivable, and you can download statements to review your cashflow. Your online banking portal is a valuable tool for budgeting and reporting. You can integrate third-party accounting software with your online banking for more control over handling your finances.

CFOs may be financial experts, but they often rely on the help of a CPA. If you haven’t done so already, consider outsourcing some of your financial tasks to an accountant. For example, hire them to review or maintain your books, prepare your tax returns, file 1099s for contractors, set up payroll for you and your employees, and consult on retirement planning. The money you spend on an accountant is an investment in your business’s financial peace of mind.

Knowing when to hire a CFO

Eventually, businesses mature to the point where hiring a dedicated CFO is a good business decision. While there isn’t a magic number, CFO Search, a national CFO recruiting site, says companies that generate between $5 and $15 million per year in annual revenue may be ready to consider hiring a dedicated person for this role. CFO Search also adds that having 40 to 50 full-time employees may also warrant having a CFO.

In addition to metrics, it’s smart to pay attention to signs inside your business. For example, if your revenue is plateauing due to slim margins or improper budgeting, consider how much time you’ve spent on these tasks. If you are unable to complete the duties because you’re too busy with owner responsibilities, it may be time to hire someone who can provide better focus so that your business doesn’t suffer.

Money is the lifeblood of your business. As an owner, it’s important to spend time and attention making sure yours is healthy and growing. By being a good owner and CFO, you’ll give your business the best chance for success.


Quicken is offered by Quicken, Inc. Wells Fargo doesn’t own or operate Quicken. Quicken is solely responsible for its content, product offerings, privacy, and security. Please refer to Quicken’s terms of use and privacy policy, which are located on Quicken’s website and are administered by Quicken.

QuickBooks is offered by Intuit Inc. Wells Fargo doesn’t own or operate QuickBooks. Intuit is solely responsible for its content, product offerings, privacy, and security. Please refer to Intuit’s terms of use and privacy policy, which are located on Intuit’s website and are administered by Intuit.

QuickBooks and Quicken are trademarks of Intuit Inc. registered in the United States and other countries.

Xero accounting software is offered by Xero Limited. Wells Fargo doesn’t own or operate the Xero website. Xero is solely responsible for its content, product offerings, privacy, and security. Please refer to Xero’s terms of use and privacy policy, which are located on Xero’s website and are administered by Xero. For more help, visit Xero support.

Xero is a trademark of Xero Limited.


LCR 0122