CFOs get a glimpse into the future

Vietnam CFO Forum, titled "Financial Management Faces Current Currency Context" this year, was hosted by Viet Nam Chief Financial Officers (VCFO) in co-operation with Japan Association for CFOs (JACFO) and (ACCA). — Photo bizlive.vn

HCM CITY (Biz Hub) — In today's complex world, chief financial officers need to consider risk holistically, support enterprise strategy through smart business partnering, and be open to new technologies, a British financial expert said.

Joseph Alfred of the Association of Chartered Certified Accountants UK (ACCA) Singapore, speaking at the 7th Vietnam CFO Forum in HCM City on Tuesday about the role of CFOs in moving towards sustainable enterprise development with Viet Nam and the region poised on the threshold of greater integration, said finance would also be people- and data- centric.

A CFO should be an integrated thinker with a focus on value drivers, he said.

In a 2014 survey of more than 1,600 members worldwide of the ACCA and Association of Accountants and Functional Professionals in Business IMA, 79 per cent agreed that finance in the future would be focused on broader business risks rather than just finance risks since forex risks do not exist in a vacuum but within the universe of business risks, he said.

CFOs would hence need to understand this universe and analyse correlations between forex risks and other operational risks, he said.

He cited Barry Greene, managing director for finance and operations at public-private health partnership Gavi, the Vaccine Alliance (Switzerland), as saying a CFO needs to be very focused on how the financial organisation is aligned with emerging business priorities.

CFOs can support business strategy by delivering richer information insights across the organisation, communicating forex risks to CEOs, guiding sales and purchase teams to be smart about transaction currencies in contracts and setting a smart budget rate for forex transactions as late as possible, he said.

Smarter CFOs have the responsibility to ensure that social networks and mobile, cloud, and analytics technologies become strategic tools in driving enterprise change and new business models, and improve the contribution of the finance organisation to support enterprise strategy and compliance with regulatory obligations.

Prioritising investment in technology would provide richer information insights and improve decision making, and analytics would help uncover idle balance sheet accounts that can be tied up to eliminate forex exposures, he said.

Future finance functions would also focus more on integrated reporting than delivering pure financial reporting as the market value of a business is increasingly reflected by the intangible assets that it holds such as data, brand, talent, and its capacity to innovate, he said.

Integrated talent management practices are the next stage in the evolution of talent development and are essential for CFOs who aspire to run good finance functions, he said.

He pointed out the most important business knowledge needed by finance – business value drivers, broader industry trends, risk landscape, technology, and digitisation.

It attracted more than 300 chief financial officers, senior financial analysts from the International Association of Financial Executives Institutes (IAFEI), VCFO, JACFO, ACCA, experts from domestic and international financial institutions, and chairpersons and CEOs of some of Viet Nam's largest companies. — VNS