It’s no secret that the Finance Director (FD) in any organisation is in charge of a lot.
They’re not just accountable for making sure all of the company’s financials are correct but are also responsible for making sure everything from payroll to tax is handled in a timely and accurate manner.
Being in charge of the financial activities within an organisation, it can be challenging to wear so many different hats at once. But because they mostly work behind the scenes, most people don’t know what finance directors do on a day-to-day basis.
In this post, we discuss 10 things only Finance Directors understand. Getting to know this will hopefully assist you in working more effectively with your FD.
1. FDs speak several “languages”
Finance directors understand that it’s critical to know how to present and describe information or reports to various departments such as Sales or Operations.
They understand that not everyone is an accountant. A salesperson may not know the story behind the report so it’s important to break it down with a clear explanation and sometimes a translation!
2. Finance Directors sometimes end up thinking like football coaches
Like a football team, you need a good goalkeeper and a good goal scorer; and one can’t cope without the other.
In other words, the FD is stuck between maintaining a balance between spending money and making sure there’s enough cash coming into the company.
They don’t want money leaving the company unnecessarily. Thus, they try to monitor how money is being spent and ensure they keep costs to a sensible level.
Alongside this, they want money being brought into the company. So they put strategies in place to ensure the company has sufficient cash flow.
3. They know how to say no
Since the Finance Director is in a position where they approve finances for projects by different departments and employees, they are not afraid to reject requests that they don’t think are appropriate for the company.
They know that saying no sometimes isn’t always a bad thing – it means that requests have been properly checked and vetted before being approved or turned down, so they aren’t rejecting things out of hand.
4. They understand the importance of timing
A lot of time management goes into accounting functions such as providing insights to stakeholders or tax filing. It takes precise planning and an understanding of how much time is left before deadlines hit to execute these tasks efficiently so that no one misses out on reports or gets penalised for late filings.
This ability to manage the timeline for different invoices, reports, and projects is something that FDs can relate to.
5. There is no such thing as a “typical day” in finance
In the eyes of a Finance Director, there is never a typical day. There are always so many tasks to handle at once and with such a tight schedule, they end up having to go on and off different projects continuously until everything is complete.
Most FDs are busy with checking up on the progress of tasks and projects they’ve handed off to their team, as well as checking up on financials and gathering information for any new projects that need to be handled.
And because most of these activities have deadlines, finance directors don’t have a lot of time to complete them. This means most days end late into the night.
6. All departments need data to function efficiently
From production to marketing, almost every department of a company needs information from the finance department in order to perform well and make big decisions.
This requires FDs to maintain healthy relationships with other departments and be constantly available for questions that might arise.
This can be challenging because the Finance Director is already working on multiple projects, but it’s also rewarding because they know that their efforts are helping everyone at the company succeed.
7. There is no shortage of work
Most people think that all the Finance Director does is sit in front of a computer and crunch numbers all day. But the truth is that there’s never a shortage of work to do, especially with new projects starting every week.
It can be challenging to keep up with more and more workloads while still ensuring everything is done accurately and within deadlines, but this is something FDs are used to handling well.
8. There is a lot of pressure for FDs to ensure the smooth running of a business
We all know cash is king, so the typical Finance Director is aware of the company’s overall business plan and investments to ensure there is sufficient cash to fund these.
Great Finance Directors don’t just stick to the numbers; they take a holistic view as to how their function fits into the broader business model and how it can impact other areas.
They try their best to manage the company’s cash flow, prepare internal and external financial reports, and budget for new projects. This includes forecasts at the beginning of each year with quarterly updates.
9. Finance Directors run their day-to-day life with the Fundamental Principles in the back of their head
FDs understand that you’re not really a Finance Director if you don’t know your key fundamental principles like you know the back of your hand.
These principles should be engrained in your everyday work to ensure you and your team uphold the standard behaviour of a finance professional.
10. Finance Directors understand that they need the right software for their team to be efficient
A good software solution that’s easy to use and provides accurate reports will make life much easier for the FD.
They know which software to use for different functions (like payroll or reporting) and can often tell you what the benefits of using it are.
The FD relies on the internal controls provided by a good financial management system because internal controls provide a level of quality assurance to stop problems before they start and help keep the business running smoothly
Get in touch with us today to learn more about what our financial management system and financial ERP can do for your business!