ORGANIZATION OF THE FINANCE FUNCTION
CORPORATE STRUCTURE
Board of directors
Group elected by the firm’s stockholders and typically responsible for approving strategic
goals and plans, setting general policy, guiding corporate affairs, and approving major
expenditures.
President or chief executive officer (CEO)
Corporate official responsible for managing the firm’s day-today operations and carrying
out the policies established by the board of directors.
The Finance Function
It is the task of those within the finance function to plan, raise and use funds in an efficient
manner to achieve corporate financial objectives. Two central activities are as follows:
1 Providing the link between the business and the wider financial environment.
2 Investment and financial analysis and decision-making.
ATENEO DE ZAMBOANGA UNIVERSITY - SMA
Chief financial officer (CFO)
Top management position charged with developing financial policies and strategies
covering all aspects of a company’s financial management and accounting activities
The treasurer (the chief financial manager) typically manages the firm’s cash,
investing surplus funds when available and securing outside financing when
needed. The treasurer also oversees a firm’s pension plans and manages critical
risks related to movements in foreign currency values, interest rates, and
commodity prices.
The controller (the chief accountant) typically handles the accounting activities,
such as corporate accounting, tax management, financial accounting, and cost
accounting. The treasurer’s focus tends to be more external, whereas the
controller’s focus is more internal.
Other career opportunities in finance
Financial analyst - Prepares the firm’s financial plans and budgets. Other duties include
financial forecasting, performing financial comparisons, and working closely with
accounting.
Capital expenditures manager - Evaluates and recommends proposed long-term
investments. May be involved in the financial aspects of implementing approved
investments.
Project finance manager - Arranges financing for approved long-term investments.
Coordinates consultants, investment bankers, and legal counsel.
Cash manager- Maintains and controls the firm’s daily cash balances. Frequently manages
the firm’s cash collection and disbursement activities and short-term investments and
coordinates short-term borrowing and banking relationships.
Credit analyst/manager - Administers the firm’s credit policy by evaluating credit
applications, extending credit, and monitoring and collecting accounts receivable.
Pension fund manager - Oversees or manages the assets and liabilities of the employees’
pension fund.
Foreign exchange manager - Manages specific foreign operations and the firm’s exposure
to fluctuations in exchange rates.
Question for Reflection:
1.) In your own words, how do you differentiate the overall functions of a controller and a
treasurer?
2.) Is it always true that the managers are distinct from the owners? Why (give real-world
examples as possible)
ATENEO DE ZAMBOANGA UNIVERSITY - SMA
