Financial Officer by clm12324

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									AJK
 AJK



       Chief Financial Officer
       Challenges and Opportunities

        Institute of Chartered Accountants of Pakistan
                            Karachi
                        August 9, 2007

                        Presenter
                    Abdul Jabbar Kasim



                            AJK ICAP CFO           February 7, 2011
Chief Financial Officer




           AJK ICAP CFO   February 7, 2011
Chief Financial Officer




           AJK ICAP CFO   February 7, 2011
                                     Global Challenge

                       In a global economy, investors would
                       benefit significantly from consistent high-
                       quality financial reporting across markets.


How Does CFO assist    This, however, can only be achieved if
                       there is greater uniformity in the way
this challenge
                       accounting, governance, business practice
                       standards, regulation and oversight
                       systems are developed and applied.

                       Importantly, such consistency supports
                       and improves an enabling best practices
                       environment



                      AJK ICAP CFO                    February 7, 2011
Chief Financial Officer

 United Rentals CFO Fired

 CFO is fired for "failing to perform
 duties"; SEC investigation reveals.




               AJK ICAP CFO        February 7, 2011
What you see is what you get


  United Rental’s board announced that CFO
  failed to perform his duties and would be
  fired if he did not remedy matters within the
  "30-day cure period" laid out in his
  employment agreement.

 According to filing, CFO is not entitled to any
 severance payment because he was fired
 for cause. However, he is entitled to be paid
 any accrued base salary, unreimbursed
 expenses and accrued vacation.




                       AJK ICAP CFO                February 7, 2011
      Competency Level
      Leadership Quality
      Material for higher level
      position
      Team Player
      General Management
      Acumen
AJK ICAP CFO               February 7, 2011
     CFO The Way
     Forward

Take A Holistic View




                 AJK ICAP CFO   February 7, 2011
Adopting a CEO mind-set

  CFOs-turned-CEOs need to forget their
 finance role as quickly as possible and take a
 much more holistic view of the business.

 In particular, they should focus on the entire
 organization—not only on the numbers—by
 spending time in operations and with
 customers and by acting as the company's
 external face to broader stakeholder groups
 beyond the financial community.




                      AJK ICAP CFO                February 7, 2011
CFO role an insight

Challenges:

 Compliance
 Financial Information/disclosure
 Increasing public information



              AJK ICAP CFO          February 7, 2011
     CFO General Impression

Aspiration
   Gain sufficient expousre in the areas of repsonsibilities

   Be involved in key areas (strategy) on a continuous basis

   To be recognized as a key player

   Board should provide opportunities for higher level position




                                AJK ICAP CFO                       February 7, 2011
    CFO Going beyond numbers

CFO career push can come if they go beyond
  budgets and financial targets and get involved in
  the annual process which is a more important
  role in developing strategy.

  This is through identifying the long-term issues
  facing the company. Also get involved in
  strategic-review meetings with the ultimate
  decision makers.


                      AJK ICAP CFO           February 7, 2011
        Survey Results

   Interviews and Discussion
           With CFO
From a cross section of economy



           AJK ICAP CFO      February 7, 2011
CFO role an insight
     Challenges:

      Compliance & Governance Issues

      Increase information:
         analysts
        regulators
        earnings forecast interviews

      Penalities and career stake




                AJK ICAP CFO           February 7, 2011
     CFO role an insight
Opportunities:
 Inter-action with board

  Involvement in strategy

  Work with key senior players

  Position in the sub committees




                             AJK ICAP CFO   February 7, 2011
     CFO role an insight
Targettting the top slot
 Getting board confidence

 Board positon as Ex. Director

 Key Participant in Strategy / Operation Management




                             AJK ICAP CFO             February 7, 2011
Professional Environment
Involvement not restricted
Participation in Strategy
Interaction with board members
Career Growth Opportunities
Can I become CEO



 AJK ICAP CFO                 February 7, 2011
Strategic move to
CEO Position


   Get into one of the committees

    Get an ED position

    Deputy to CEO

    CEO position



                AJK ICAP CFO        February 7, 2011
Take initiative --Enlarge area of
 responsibilities

Get involved in strategic planning

General Management Initiative




                                     AJK ICAP CFO   February 7, 2011
          CFO



Take initiative --Enlarge area of responsibilities

How do I do it:

         Do some strategy paper work for the organization

         Bring areas of key importance to the knowledge of the
         board

         This should be done in a subtle way



                                  AJK ICAP CFO               February 7, 2011
   CFO



Take CFO position

Involvement in building the right financial infrastructure----
policies and procedures etc

Bring outside knowledge

Find ways to join committees (by extra work)
which a board member presides.

Endeavour to facilitate the mandate of such
committee---use you outside and professional
 knowledge
                                  AJK ICAP CFO                   February 7, 2011
CFO


Get involved in strategic planning

    Clearly understand Boards goals and
    objective

    Do not rest on being a good number cruncher

    Understand why plans are changed and
    strategy revisited

    Take initiative, horn your General management
    skills
                         AJK ICAP CFO               February 7, 2011
     Financial-statement fraud
     SEC Report:

Technology, media, and telecommunications companies for 39
percent of fraud

Consumer businesses comprised 30 percent.

Manufacturing companies 10 percent .




                            AJK ICAP CFO              February 7, 2011
Financial Statement Gimmicks


 Bulk of present day investigations by regulators
 revolve around profits adjustment /restatement of
 profits.


 CFOs and CEOs are being held responsible for lack
 of attention or self-interest




                   AJK ICAP CFO              February 7, 2011
Financial Statement Frauds

 Nortel was carrying over $300 million in excess
 reserves, they did not release these excess
 reserves into income as required under U.S.
 GAAP,

  According to the (SEC) commission; allegedly,
 the existence of the reserves was concealed so
 they could be maintained for later use.




                  AJK ICAP CFO             February 7, 2011
CFO negligence

 CFO, was sentenced to three years in prison for
 authorizing the release of a prospectus that omitted a
 material fact. The $4.5 billion collapse of HIH in 2001 is
 considered Australia's biggest corporate failure.




                      AJK ICAP CFO                  February 7, 2011
              CFO
International Scenario


        AJK ICAP CFO   February 7, 2011
Do Chief Financial Officers
make desirable CEOs

   At a time when finance plays an ever-larger role in
   corporate strategy and many CFOs serve not only
   as key advisers to the CEO but also as the point
   person for communicating with financial markets,
  the CFO's portfolio of skills would seem to serve
  well as a platform for that final leap to the slot.




                    AJK ICAP CFO                February 7, 2011
Feedback

 About a fifth of all CEOs in the United Kingdom and
 the United States once served as CFO.

 In Asia the number is somewhere
  between 5 and 10 percent

 This is due to the fact the perhaps many companies in
 Asian region still have
 CFOs who predominantly focus as controllers.



                    AJK ICAP CFO               February 7, 2011
International Feedback

   Many experts suggested that to become a
    successful CEO, a CFO needs hands-on general-
    management experience.

   CFOs are also perceived as "much too narrow ever
    to become CEOs"—a perception that CFOs must
    continually fight.

   Counselling:
    CFOs to exit the finance department at
    some point in their career and build
    expertise in a different function


                     AJK ICAP CFO            February 7, 2011
 THIS IS ALL FOR TODAY

MAY ALLAH BLESS US ALL

 THANK YOU FOR YOUR

PATIENCE AND ATTENTION




      AJK ICAP CFO       February 7, 2011

								
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