Financial planning analysts and Chief Financial Officers (CFOs) work together to properly manage a company’s finances, an essential goal for any successful business. While these two roles are closely related in their pursuit to strategically support and maintain a company’s finances, this article details how financial planning analysts assist CFOs in company decision-making.

Overview of FP&A and CFO Roles

Financial planning analysts are members of Financial Planning and Analysis (FP&A) teams whose primary task is to analyze a company’s financial data to determine a company’s budget and predict future cash flow. Financial planning analysts work under CFOs, and CFOs use FP&A reports to improve and maintain their company’s financial health.

FP&A Primary Responsibilities 

Financial planning analysts are responsible for understanding and evaluating the big picture of their company’s finances, and they are primarily concerned with the future financial security and stability of their company. Specifically, the FP&A team completes the following tasks to better achieve this aim:

• Analyzing: FP&A teams analyze past and present financial trends—spending, investments, and profits— including the financial efficacy of departments within their company.
• Planning: FP&A teams use their analysis of the company’s financial health to develop plans that will fulfill the current and future needs of the company. These plans can include future growth opportunities as well as predicted profits and expenditures.
• Forecasting: FP&A teams also use their analysis to predict the future financial health of the company, which includes updating and improving the accuracy of previous financial models and forecasts. Based on their understanding of their company’s trajectory, financial planning analysts can make confident recommendations to their CFOs.
• Reporting: FP&A teams prepare internal reports at both department and company-wide levels that reflect their data analysis and recommendations. While the FP&A team is not the final decision maker for their company, they prepare these reports to aid the executive leadership, including the CFO, in making critical financial decisions.

(For more information regarding the responsibilities of financial planning analysts, see “What is FP&A? Roles and Responsibilities” and “FP&A: How FP&A Supports a Corporation.”)

CFO Primary Responsibilities 

As mentioned previously, CFOs work over the FP&A team in the finance department, and there is a significant difference in their duties due to the nature of their responsibilities. In addition to overseeing the FP&A team, CFOs are also over the Controller and Treasury teams. These three teams—FP&A, Controller, and Treasury—provide their CFOs with the details the executive management needs to make informed financial decisions for their companies. CFOs have many responsibilities, which is why it is so helpful that the financial planning analysts can focus on the smaller analytical details before reporting their big-picture findings to the CFO.

In addition to acting in a decision-making and leadership role, a CFO’s primary responsibilities include the following:

• Reporting: Aided by the controller team, who manage a company’s financial reports, CFOs must ensure that all records and reporting are accurate and timely.
• Liquidity: CFOs work to meet and maintain their company’s financial responsibilities, and manage the efficiency of company cash flow. The treasury team assists the CFO with these responsibilities.
• Return on Investment: CFOs are also responsible for managing the increased profitability of their company through returns on company investments. The FP&A team provides their CFOs with the information necessary to make decisions about future company profits.

(For more information regarding the responsibilities of CFOs, see “What Does a CFO Do?” and “6 Things Your CFO Should Do For You.”)

The Benefits of the FP&A and CFO Positions

Some may wonder if it is necessary to have both the FP&A and CFO positions in their company. While these roles are closely connected, each position has its unique tasks, which allows for a more manageable and efficient dispersal of responsibilities. It is important to remember that a CFO not only manages the FP&A team but also the other teams within a finance department. In this way, the CFO acts as an essential leader that can evaluate the findings of multiple financial teams to make the most beneficial financial decisions for their company. Financial planning analysts play a large role in that decision-making process, but a CFO’s broader understanding of company finances allows for more accurate decision-making.