When a CFO suddenly departs, it can leave your business in a vulnerable position. Financial operations are too critical to put on hold, and the emotional toll of losing a key leader can further compound the challenge. What’s your solution? An interim CFO – a professional you can onboard quickly while maintaining business stability and preparing for a permanent hire.
What to Do When a CFO Leaves?
The first step after a sudden CFO departure is assessing the company’s immediate financial needs. Prioritize urgent processes such as cash flow management, ongoing projects, and upcoming deadlines for financial reporting. Gather insights from the remaining finance team around current projects and priorities; they’ll help you pinpoint areas the prior CFO neglected, and an interim CFO’s attention is most needed.
The interim chief financial officer’s main responsibility will be to stabilize the company’s financial functions. They’ll need to address key concerns while guiding the business through the transition without missing critical financial deadlines or derailing projects. Once you understand your business’s immediate priorities, you’ll be better positioned to brief your temporary CFO and get them up to speed quickly.
What Does an Interim CFO Do?
An interim CFO will step into the role temporarily, focusing on keeping your financial operations running smoothly. They’ll ensure that the company’s cash flow is maintained, oversee financial reporting, and take charge of short-term financial strategy. Key responsibilities typically include:
- Cash flow management
- Financial reporting and compliance
- Short-term financial strategy development
- Support ongoing projects such as mergers, acquisitions, or fundraising rounds
Interim or temporary CFOs are highly adaptable professionals with the expertise to step into critical leadership roles. Their focus is on stabilizing the business during the transition and ensuring continuity until a permanent CFO is found.
How Can a Company Quickly Find a Qualified Interim CFO?
Finding a qualified temporary CFO quickly requires tapping into the right resources. Given the urgency, here are the best strategies to identify and onboard the right candidate:
1. Leverage Your Network
Reach out to your network for recommendations. Trusted contacts in your industry or professional circles may know of experienced interim CFOs who can step in immediately. Many businesses have faced similar situations, and referrals can help you find a reliable candidate swiftly.
2. Engage a fractional CFO team
Firms specializing in temporary CFO services or fractional CFO services can expedite the process. These firms maintain a network of pre-vetted financial executives who are ready for short-term engagements. Their ability to quickly match their team with your company’s needs can significantly reduce downtime.
3. Explore Freelance Platforms
There are online platforms that specialize in connecting businesses with interim executives. Sites like LinkedIn, Toptal, or other freelance executive networks offer access to experienced CFOs who are available on short notice. These platforms allow you to browse profiles, review credentials, and quickly set up interviews with potential candidates.
Once a candidate is identified, ensure that they have experience managing transitions, stabilizing finances during challenging times, and working in your specific industry or a similar environment.
Managing the Interim CFO Relationship
A smooth transition requires more than just bringing in a capable interim CFO—it’s about ensuring effective communication and knowledge transfer. Here’s how to facilitate a seamless onboarding process:
- Brief the Interim CFO Thoroughly: If possible, have the outgoing CFO provide a transition plan. If that isn’t feasible, involve your senior management team in preparing a detailed handover of critical projects, financial reports, and priorities.
- Set Clear Expectations: Outline specific goals for the interim CFO to focus on. These should be directly aligned with your company’s immediate financial needs, such as managing cash flow, stabilizing operations, and ensuring compliance with reporting requirements.
- Maintain Communication: Regular check-ins with the interim CFO and other C-suite leaders will help keep the company aligned and ensure any issues are addressed promptly.
As you manage this interim phase, also focus on your long-term goal: finding a permanent CFO who aligns with your company’s culture and strategic direction. Keep the interim leader engaged in this process so they can ensure a smooth transition when the time comes.
Conclusion
Losing a CFO suddenly can be a daunting challenge, but by acting quickly and strategically, you can stabilize your business and bring in the right interim CFO. With the right plan in place, your business can move through this interim period smoothly while you search for a permanent CFO.
This article was written by a CFOshare employee with assistance from generative AI for rhetoric, grammar, and editing. The ideas presented are a combination of the author’s expertise, original ideas, and industry best practices.
