The difference between CFO and CEO
There are many different terms associated with the corporate world, such president, vice-president, CFO, CEO and COO. All of these refer to the structure of an organization. You can usually tell that each one is a different entity, but there is some confusion as to the duties of CFO and CEO. Both of these are important posts in a large corporation and their existence makes it easy to govern the organization. They are one post beneath the Board of Directors. They refer to two positions of management that have a hands-on approach to the day to day business activity.
What is a CEO?
CEO stands for Chief Executive Officer and this person is the boss of the operation. It is the top management position in the corporation and is responsible for all of the departments, making sure that each one can carry out its duties without any problems. He/She reports to the Board of Directors and the chairperson.
A CEO can also be a member of the Board of Directors and in this capacity he has a dual role. In addition to the CEO duties, he has to take part in formulating the policies as well as oversee their implementation. To the employees this person is the boss, but he too has several bosses – the Board of Director.
What is a CFO?
CFO stands for Chief Financial Officer and this position is one that is responsible for the financial, goals, objectives and budgets. Management of the funds and the supervision of the cash management are the two main jobs of the CFO. In a larger corporation this person plays a significant role in acquisition and mergers and has to come up with and implement strategies to help the corporation raise the money it needs for various ventures.
In addition to overseeing the daily financial activities, the CFO analyzes the financial data to prepare financial statements and annual reports as well as budget sheets for the coming year. This is the person who has to prepare all the financial information related to the corporation and present them to the Board of Directors and the shareholders.
The CFO is an important link between the corporation and the shareholders as well as between the shareholders and the Securities and Exchange Commission. The position is equal to that of the vice-president and is responsible for the routine check on the financial health of the corporation.
- The positions of CFO and CEO are important ones in the corporate world.
- The CEO is the boss of the entire corporation and the CFO is the boss of the financial part of the business.
- Everyone else in the company reports to the CEO, but the CFO reports to the Board of Directors.
- The CEO manages human resources and the CFO manages the financial resources.