CFO stands for Chief Financial Officer and CPA stands for Certified Public Accountants.
Both of them are financial experts to support your business for a long run. Both experts possess distinct duties, qualities, and expertise in their own way. In fact, both of them are good at handling a company’s financial and accounting tasks. But the confusion arises when an accounting firm has to choose between these two experts for their accounts management.
For a wise selection, understanding the difference between CFO and CPA is must. That’s why this article is a complete guide to help you choose the expert for your business finances.
So, let’s dive in.
Let’s talk about the concept of both the terms below.
What is Chief Financial Offer (CFO)?
Simply putting, CFO is a senior executive officer who leads the financial management of a business. The expert basically analyzes your company’s financial statements and sales performance to inform business decisions. Additionally, they work closely with the CEO of and investors. In fact, CFOs usually spend most of their time at least 90% of their time on the business and only 10% on accounting.
What is Certified Public Accountant (CPA)?
CPA, on the other hand, focuses majorly on historical data to produce the monthly, quarterly, and annual accounting and to prepare financials. CPA also maintains your bookkeeping work, carry out accounting procedures, and analyze financial data. Here CPAs spend 90% of time on accounting and tax and 10% on business.
A list of major difference between CFO and CPA
Duties and functions
CFO – Developing financial strategy, performing scenario modeling, preparing financial projections, helps in comparing actual vs. budget, provides you report on financial performance, presents finance statements to the boards and investments.
CPO – Prepare/analyzing reports and financial statements, develop accounting processes, manage accounts payable and receivables, creating budgets, complete month-end close procedures, and finally ensures your bookkeeping to maintain accuracy and compliance of financial records.
CPAs are best for managing taxation
Taxation is one of the most crucial aspects of any business especially the large and big companies. And proper tax management keeps your business growing in long run. That’s the reason why firms and businesses seek expert to manage their taxation and CPAs play a significant role in that. Basically, a CPA will traditionally keep, audit, and inspect financial records, and finally prepare tax reports.
CFOs implement financial strategy
Are you concerned about your business financial strategy? CFOs are here to work for you. But let me tell you that CFO might not work significantly for your business finance strategy but they surely brings a level of strategy for which your firm’s in-house team may not be qualified. Since CFOs have wide range of industry knowledge and expert’s field, they prepare for financial strategy and implement them in your strategy. You can also avail accounting services in Dallas for financial strategy for your business.
CPA should be your go-to, if your business requires:
- – Setting up accounting system
- – Preparation for an audit
- – Selecting and setting up accounting software
- – Addressing any accounting issue
- – Professional assistance in tax filling, planning and management
- – Preparation of monthly financial report
CFO should be your go-to, if your business requires:
- – Financial leadership
- – Guidance with tax strategy
- – Insight of capital structure and investments
- – Planning for your financial forecast
- – Advise on growing the business
- – Help reducing expenses, maximizing assets or resolving cash flow issues
- – Strategic planning on the basis of financial data
The list doesn’t end here. If you see some situations requires both the experts to manage business finances.
CFO vs. CPA – The bottom line
I hope you have read this article thoroughly to know the major difference between CFO and CPA. Here I would only say that both the experts are good at the work they do. And it’s highly up to your business which expert you need the most. To secure business funding, hiring a CPA is better option whereas CFO works best to create financial models and present them to investors. In case, you want virtual bookkeeping services in Mesa, consider hiring by clicking on the link.
However, with Kayabooks, you no need to decide between CFO and CPA. Why? Because we provide all kinds of financial services to our clients at much reasonable price. For more queries, get in touch with us here.