Money makes the world go round. This has been the case since it was invented to replace the outdated barter system, and it remains so today, in the midst of the digital age, which has even seen the emergence of cryptocurrencies. Every company aims to make a profit, i.e., money, which is why the person and department responsible for accounting are so important. This is the main reason why there has always been a chief accountant or financial director in every business. However, the new digital paradigm also presents new challenges in terms of accounting. Therefore, in this article, we will try to outline the main functions of the financial director today and, above all, tomorrow. Will you join us?
What is a financial director and what do they do in a company?
Answering this question in this article may seem obvious, given that the blog easyap is a space designed for managers and accountants. Even so, we prefer to take it step by step. First, by defining what a financial director is and then clarifying what their most common tasks were before the online boom.
The chief financial officer is the person responsible for the management and financial planning of an organization based on a budget and financial information. In turn, the CMO for its acronym in English (Chief Financial Officer) is often considered one of the most important positions within any company, as hierarchically he or she is usually only surpassed by the CEO or executive director of the company.
All right. Now that we have defined the concept, let's establish what the functions of the CFO at a general level:
- Manage and carry out financial controls on the company's accounts.
- If there are any, monitor actions relating to finances being carried out by other divisions, subsidiaries, and/or departments belonging to the company.
- Manage, coordinate, and establish financial relationships with suppliers, i.e., banks and credit institutions, as well as with customers.
- Ensure that a company's purchases and sales are in line with pre-established budgets.
- Establish a series of general objectives and indicators (in other sectors, these are called KPIs).
- Designing short-, medium-, and long-term action plans and strategies in the short, medium, and long term that guarantee the company's financial viability.
And at the same time, to conclude with what a financial director and their duties from a general and conventional perspective, we should mention that their responsibilities will vary depending on the company and its size.
Therefore, depending on the company in question, in certain cases it is likely that the the duties of the finance director may be supplemented by human resources tasks or even tasks related to digitization.
The three roles as financial and administrative director
So, what does a CFO do? Among the the duties of a CFO is to be the public face of the company in front of investors or stakeholders of the company. Provided, of course, that we are talking about financial matters.
Likewise, the financial manager will devote their entire working day to performing the tasks listed above. However, given the significant weight carried by a finance director, they will also perform the following three functions of administrative and financial director with potential or current partners:
- You will participate in decision-making related to investments or the company's own business.
- You will be part of the team that structure the capital of the organization, whether it is the birth of the organization or a specific and/or subsequent restructuring for whatever reason.
- You will manage expenses and profits and present them to investors and partners.
The digitization of the CFO and their roles
Accounting books, paper, pens, and calculators were the basic tools of any manager working in finance. It didn't matter whether it was a large company with millions in turnover or an SME. SME. Every business needs to keep its accounts up to date and use them to plan for the future.
Subsequently, with the first technological advances of the Internet that we know today, tools such as Excel began to simplify the tasks of financial directors. However, the biggest change has come in recent years with the boom in online commerce.
The digital transformation of business is now a very tangible reality. A good example of this is that global e-commerce sales reached $26.7 trillion worldwide in 2019, according to UNCTAD (United Nations Conference on Trade and Development). This figure, which will increase due to the COVID-19 pandemic, represents 30% of global GDP and includes both between companies (B2B) and between companies and end customers (B2C).
However, this reflection of the need for companies to digitize is something that we at easyap detected several years ago. Our team includes executives with extensive experience in the world of finance, and we understand the needs of the sector. That is why we realized some time ago that one of the greatest contributions we could make to the accounting and finance departments of many businesses was to develop a technological solution for electronic invoicing. We know how to use it and why it is beneficial for you.
With the help of technology specialists, we are embarking on digitalization for businesses. How? By offering our help to simplify one of the most time-consuming tasks that financial directors have always had to deal with: invoicing. And how? By digitizing it. That's how easyap was born, and based on that concept, we have been developing projects and solutions tailored to large companies and SMEs around the world for more than 20 years.
Benefits of digital transformation for a CFO
Any accountant, CFO, or similar position seeks to save costs in their company. To do so, they are aware of the many hours of work involved in invoicing for any business. Purchases and sales that must be recorded, taxes and other legal aspects that must be recorded and processed for the relevant authorities, keeping suppliers up to date on the status of each invoice when they request it, etc.
The fact is that at easyap we are aware that these financial management functions ended up consuming a large part of the working day of many accountants. Even more so if, as in the past, they were carried out manually. However, we have been able to develop and market tools that provide two very valuable assets for any manager:
- Time, since with the easyap solution all processes are carried out much faster.
- Money, since, in addition to offering a customized cost for each client's billing and the time savings that could even allow you to attract more clients, with software such as easyap, you will avoid tax and fiscal problems that could end up resulting in very high penalties.
Beyond technical knowledge, the experience of a CFO is another quality that should be valued. Thanks to this experience, you will know that there are few things more valuable to any business than the two we have just mentioned. In addition, the financial and time resources you save can be invested in other functions you have as a financial administrator of a business.
Likewise, by implementing our electronic invoicing software for your company, you will be opting for a solution that, in a single space or digital platform, allows you to:
- Issue your invoices in digital format.
- Receive electronic invoices for the purchases you make. In turn, we remind you that for sales with the public administration, mandatory for invoicing to be electronic.
- Follow each step online in great detail involved in the billing process.
- Provide specific information and attention to each of your suppliers about how their digital invoices are doing or what stage of the process they are at.
- Record all employee expenses that are incurred in your business.
- Comply with all tax requirements that you must meet based on your geographical business area.
Regarding this last point, as you will know if you are a regular reader of easyap's articles on electronic invoicing, we keep up to date with tax legislation and adapt to it. SILICIE and TiketBAI in Spain or the PEPPOL protocol for transferring data with many countries are topics that we have already discussed in our blog and which, of course, we manage and take into account when implementing our solution.
And, in addition, by taking this step towards digitizing your business, we also help with a touch of sustainability, since we eliminate paper by recording everything electronically within the software.
At easyap, we can even give you advice on what to consider when choosing electronic invoicing systems. That's what comes with having worked on projects all over the world. Experience, guaranteed knowledge, and flexible pricing, as the cost varies depending on the number of invoices you issue. Do you really want us to give you more reasons to take the leap into digital transformation and to do it with us? At easyap, we are waiting for you.
