It’s New Year’s Eve—as so many people do, I’ve taken the time to reflect on 2013 and look ahead to the next year.
2014 should be a good year—the economy is improving, a lot of bigger companies are preparing for growth once again, and things are going really well for early-stage companies. But it’s definitely not like the dot-com boom, as some are saying. The market may be picking up, but it’s doing it in hiccups—and many companies aren’t feeling it yet. Our clients are getting traction, but they’re working really hard to make progress.
We’ve been diligent at RoseRyan too—we’ve been following our own advice to invest during the down times. We’re seeing starts and stops and ups and downs in our clients’ business, and we’re putting things in place so when the market uptick goes full-on, we’ll be ready. We’ve expanded the management team, and we’re investing in our products and services, and making sure we have up-to-date tools and technology.
We are also investing in our consultants, deepening and expanding our bench strength so we have the right talent for our clients as well as the services they need. I feel confident that we’ll be able to tackle just about anything that comes our way.
And 2014 is looking to be a very busy year. Revenue recognition will have a huge impact on our clients (this train is coming whether we like it or not), and the new COSO framework is at the top of many to-do lists. The proposed changes to lease accounting are also potentially big, but it’s not on the near horizon.
Finally, private companies have the opportunity to simplify their accounting, but I think most companies looking to go public one day won’t take that route. It does make sense if a company has no desire to go public but needs audited financial statements.
I see three big challenges for CFOs, and they have nothing to do with rules. The first is the endemic talent shortage. It’s affecting everyone here in the Bay Area.
The second challenge is the ongoing shift from a portfolio of accounting and finance projects to also providing business savvy to the organization. What exactly does it mean to be a strategic CFO? A lot is written about this and discussed at conferences, but the piece that always gets overlooked is the need for a strategic team behind the CFO. Among other things, they need to understand analysis and provide the right information to all stakeholders—the SEC, the C suite, other departments, investors—in a way that resonates with them. CFOs get it, but I’m not sure the rest of the departments are there yet.
The third challenge is the pace of change. It’s not going to get better, and finance organizations need to keep up. I think that’s why the bigger companies struggle; they’re just not as nimble as smaller companies.
I’d love to hear from you if you have ideas about how the CFO can meet the challenges facing finance organizations in 2014.
Happy New Year to you!
