Public Sector Leaders Series Luncheon

1. CPA Public Sector Leaders Series
CFOs as leaders in the public sector
27 June 2014
Grant Hehir
Auditor-General

2. For CFOs, It's No Longer Only
About the Money
“The current economic climate
has presented CFOs with a
unique opportunity to take on
top leadership positions …”
“….during economic tightening,
the value of a financial mind is
in more demand and more
critically needed”
Fox Business – 24 October 2013

3. Role of the CFO
“The modern CFO is often the
right-hand man or woman of the
CEO and the role now requires
someone with a dynamic
background far beyond finance”
“They are doing everything except
being the public face ….. and the
final decision maker”
It's No Longer Only About the Money
Fox Business – 24 October 2013

4. Role of the CFO
The Organisation:
Governance
Requirements
The Role:
CFO Core
Responsibilities
The Individual:
Personal Skills and
Professional
Standards
1
2
3
4
5
The Chartered Institute of Public Finance and Accountancy
1. Key member of leadership team
helping to develop and implement
strategy
2. Lead whole-of-organisation financial
management – appropriateness,
economy efficiency and effectiveness
3. Influence all material business
decisions:
opportunities and risks are fully
considered
aligned with financial strategy
4. Finance function – fully resourced and
fit for purpose
5. Professionally and suitably qualified

5. Functions of the CFO
Controllership
Tax and Treasury
Internal Control
Financial planning
Compliance management
Investor relations
Strategic planning
Risk management
Business analytics
Business improvement
Transactional
Governance
&
Decision Support
Controllership
Tax and Treasury
Internal Controls
Compliance
Management
Delegations
Policy Development
Financial Planning
Investor Relations
Strategic Planning
Risk Management
Business Analytics
Business Improvement

6. Impact of the CFO
Disciplined Operators
• Finance operations focused
• Information provision
• Performance interpretation
Value Integrators
• Performance optimisation
• Predictive insights
• Enterprise risk management
Constrained Advisors
• Analytics focused
• Suboptimal execution
• Fragmented data
Scorekeepers
• Data recording
• Controllership
• Multiple versions of the truth
High
Low
Low High
Finance
Efficiency
Business Insight
IBM – Accelerating Performance 2010

7. The High Performance CFO
Today, the CFO doesn’t wait for the CEO or
business unit manager to say, ‘Here’s an
issue; I’d like you to go do some analysis,”
“The CFO needs to decide what the issues
are, and bring them to the table and say, ‘We
haven’t discussed this,..”
“…the finance leader plays two pivotal roles:
the first role is that of business partner—that
is, having an active stake in analysis and
strategic decision making.
the other role is the ‘pragmatic strategist’
…More and more CFOs are being asked to
evaluate, in a pragmatic way, what the
strategies are and what risks those strategies
entail.”
PricewaterhouseCoopers and Wharton University of Pennsylvania
IBM

8. Good Financial Management -
New Zealand
Reviewing financial management in central government –
Office of the Auditor-General, New Zealand, June 2012
Financial Management in Central Government

9. NSW Financial Management
Transformation

10. Future Focus
Financial Reporting
Financial Controls
Governance
Service Delivery

11. Reform Agenda
The Government agreed with
the six reform themes identified
by the Commission of Audit:
devolution
partnerships and
outsourcing
workforce flexibility
transparent and evidenced
based decisions
collaboration and
coordination
budget constraint
NSW Government
response
to the
Final Report of the
Commission of Audit
August 2012

12. Impact of the CFO
Constrained AdvisorsScorekeepers
High
Low
Low High
Finance
Efficiency
Business Insight
IBM – Accelerating Performance 2010
Value IntegratorsDisciplined Operators

13. Thank you

14. The following two slides were
distributed at the presentation

15. Impact of the CFO
Disciplined Operators
• Finance operations focused
• Information provision
• Performance interpretation
Value Integrators
• Performance optimisation
• Predictive insights
• Enterprise risk management
Constrained Advisors
• Analytics focused
• Suboptimal execution
• Fragmented data
Scorekeepers
• Data recording
• Controllership
• Multiple versions of the truth
High
Low
Low High
Finance
Efficiency
Business Insight
IBM – Accelerating Performance 2010

16. The High Performance CFO
Today, the CFO doesn’t wait for the CEO or
business unit manager to say, ‘Here’s an
issue; I’d like you to go do some analysis,”
“The CFO needs to decide what the issues
are, and bring them to the table and say, ‘We
haven’t discussed this,..”
“…the finance leader plays two pivotal roles:
the first role is that of business partner—that
is, having an active stake in analysis and
strategic decision making.
the other role is the ‘pragmatic strategist’
…More and more CFOs are being asked to
evaluate, in a pragmatic way, what the
strategies are and what risks those strategies
entail.”
PricewaterhouseCoopers and Wharton University of Pennsylvania
IBM