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#1 Quality Needed in Your Nonprofit CFO

best practices board finances foundation Jan 19, 2023

Qualities of a Nonprofit CFO

     When you think about a nonprofit CFO (Chief Financial Officer), what comes to mind? What do you think you need from the person in this role? Many people think something like, “I need someone who knows all that accounting lingo- debts, credits, etc.” Others may be thinking, “I’m looking for someone who can set up a safe environment with internal controls and checks and balances.” You may say, “We need someone who can make sure that all the financial records are correctly balanced and reconciled.” Maybe you’re more concerned with finding someone who can prepare really excellent nonprofit financial statements. 

     Well, all of these are necessary qualities in your CFO, so if you don’t have someone like this, maybe you should find someone. But the most special and unique quality you’ll find in a nonprofit CFO is a trusted partner. So, what do I mean by this? 

Your Nonprofit CFO Should be a Trusted Partner 

     You need a trusted partner in your finances- someone who can come alongside of you to help make your mission a reality. How does this one person actually do that? Well, they use strategic thinking in the financial realm to come alongside the direction that the board and the leadership is setting. Here's just a few examples:

  •   Maybe you're considering adding a new program or evaluating whether or not an existing program is actually producing results and considering whether  to repurpose or transition it to another focus area.  Well, in this case, finances tell a great story. A CFO isn't going to tell you what to do. They're going to provide quantifiable financial data to help support your decision making. 
  •  Perhaps you're facing a timing decision, like finding the best time to start a capital campaign. Well, a CFO comes alongside you, bringing to the table both backward looking trend measurements and forward looking projections along with some ratio planning to help you check the pulse of your finances first.  They give you a clearer perspective with which to assess the strength of your financial positions before launching any capital campaign.

CFOs Make Data Actionable

     While I could list a dozen more practical examples, I would say more than anything, a nonprofit CFO becomes your trusted partner by bringing the superpower of deeply understanding your financial data and then connecting the dots between money and mission. They take financial data and they help you take action.  They make financial data actionable to support you in your leadership role.

     I hope that this is helpful and brings clarity about the nonprofit CFO’s role, and how it differs from the role of an accountant or a bookkeeper. As always,,  I’m available to help further, and I would love to answer any questions you may have. Click here to schedule a free call with me. I hope you have an incredible CFO in your corner! 

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