How we differ from CPAs, how we work with them (CPA required)
Nearly all businesses work with a Certified Public Accountant (CPA) and CPAs enjoy the status of being
one of the most trusted professional groups in America. However, not all businesses have a Chief
Financial Officer (CFO) and business owners are often unclear on the difference between the duties and
skills sets of CFOs and CPAs.
One notable difference is that CPAs are, as the name says, certified. They have passed an exam
containing four sections: Auditing and Attestation, Business Environment and Concepts, Financial
Accounting and Reporting, and Regulation (including taxation). One must also hold an accounting degree
to sit for the exam and then nearly all states also require relevant work experience in order to become
certified. Then continuing education is required to maintain certification.
Although a CFO can certainly hold a CPA designation, it is hardly a requirement. In fact, one of our pet
peeves is seeing job postings for CFOs stating a CPA is required. This is because the duties of a CFO and
CPA are very different. Perhaps the key difference is that CFOs operate within companies and are
responsible for internal reporting and operational decisions. CPAs are predominantly outside of their
clients. Where a CFO will be responsible for preparation of financial statements, CPAs will provide
services to attest to the accuracy of those statements in the form of Audits and Reviews. CPAs will also
be engaged to prepare tax returns and provide tax guidance where the CFO doesn’t have that particular
expertise. But execution on tax planning and preparation of reports used to prepare tax returns will fall
on the CFO and his or her team.
A CFO’s responsibilities also go far beyond accounting and tax. Typically, they will be responsible for
forecasts and budgets, financial systems, internal controls and processes, transaction processing
systems, cash management, and financial analysis. They are also likely to be heavily involved in human
resources, compensation plans, strategy, and legal. This is the reason that while a CPA certification can
provide one cornerstone of a CFOs background, a CFO might just as easily have MBA with
concentrations in finance and accounting plus considerable operating experience, perhaps as an
accountant or Controller.
As part-time CFOs, our role complements what CPAs do and not replace them. We rely on CPAs to
provide the tax expertise we don’t have and where audited or reviewed statements are required, that
can only be done by a CPA firm. Conversely, we bring a skill set the CPA designation alone doesn’t attest
to. These are around the internal, operating duties mentioned above. So, if you’re happy with your
existing CPA, adding a part-time CFO doesn’t change that relationship. Your CPA remains your external
expert. However, a part-time CFO becomes your expert in internal operations and part of your day-to-
day management team but at a fraction of the cost of a full-time person.