The skills and value of an effective finance department

Simon Speak of AFR Consulting explains how having a great finance team can ensure your business weathers any storm.

Particularly when times are tough, employers need to focus on developing an effective finance team with the right skills and experience to overcome economic challenges.

Having a firm grip on credit control and cash-flow is absolutely vital, and it all stems from solid management by an experienced finance director.

Over the last few years the FD position has diversified and now carries a range of responsibilities and opportunities extending far beyond its traditional finance functions.

Your FD takes on critical responsibilities – effectively managing the balance sheet, ensuring robust corporate governance is in place, maintaining sensible growth, and providing a prudent approach to decreasing levels of credit available.

To support the FD you also need a strong team of financial professionals. A skilled management accountant will ensure you can analyse efficiencies and minimise non-essential costs.

Meanwhile credit controllers provide vigilance in monitoring debts, managing payment plans, and devising discounts in return for prompt payment. They can also put procedures in place to manage poor credit ratings and prevent problems arising.

The ‘softer’, skills are crucial now as well, especially by those who see the post as a stepping stone to the top of a company, to many – stakeholder communication and relationship management skills are almost as highly valued as financial aptitude. What value should a finance team add to my business?
  • Identify which parts of your business make the most profit
  • Establish stringent cash management and internal controls to provide working capital needed to survive or grow.
  • Develop management information systems to understand commercial and financial drivers of your business
  • Implement new or more efficient IT accounting systems
  • Risk assessment on new ventures, contracts and tenders
  • Find finance to fund growth organically or through acquisition, flotation or MBO
  • Identify opportunities to reduce tax bills and bank or currency charges
  • Enhancing the structure and calibre of the finance department should be a priority for any business that wants to ensure it survives and thrives in a difficult economic climate.