Tax liability of the financial director
Posted: Tue Jan 21, 2025 8:27 am
The company employee we are interested in may bear this type of liability jointly with the chief accountant in the following cases:
shell companies were used;
the tax authorities were given knowingly false information;
illegal business fragmentation was used;
data on taxable objects were deliberately distorted;
the tax benefit was applied unlawfully;
the transaction was not properly executed.
To avoid the company's CFO having to business owner database answer for the chief accountant's mistakes, their powers must be immediately delineated. It is equally important to record the responsibilities of each of these specialists in job descriptions and employment contracts.
Civil liability of the financial director
An enterprise can file a lawsuit to recover losses related to the intentional actions or lack of necessary competence of the financial director. For example, the manager did not pay taxes, behaved negligently. But to do this, the company will need to prove the connection between the actions of this employee and its losses.
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Employee's material liability: what theory, practice and the courts say
Anti-crisis financial management: tasks, stages, solutions to problems
Goals and objectives of the financial director
Often we have to face a situation when this specialist is assigned different functions, which is why there is a misunderstanding between the parties when hiring. As a result, holding the CFO's resume in his hands, the CEO does not know what tasks he should give to this specialist, what powers to grant him. While the applicant himself does not know what the new management wants to get from him, whether he will be able to satisfy such requests. As a result, the head of the HR department does not understand who he should find and how to determine that the candidate is suitable.
But since the issue needs to be closed in any case, when selecting a candidate for such an important position, they most often rely on formal characteristics. These include the education and training completed by the financial director, work experience. They may even ask whether the applicant is able to explain what a certain coefficient means. However, one should not hope that such an approach will yield a good result.
Goals and objectives of the financial director
It is important for any company to find a professional, because such a person knows exactly what and why he is doing, what effect he will get from it. It is not enough for a company's financial director to have a set of special knowledge, he also needs skills that will allow him to lead the company to the desired result.
Let's explain the principle of selecting this specialist using an analogy with choosing a professional boxer for a bet on a totalizator. It is obvious that the athlete knows many different punches and has several signature moves, in other words, has a lot of tools. However, this indicator does not matter - what matters is whether the boxer is able to defeat the opponent. And here it does not matter what punches he decides to use - this person is obliged to show his ability to win. Therefore, during the introduction of boxers, only height, weight, age, number of victories and defeats are mentioned. And only during the fight, commentators talk about the nuances associated with a specific fighter.
It is important that the candidate for the position clearly sees his goals. However, the development of the company leads to the fact that the guidelines gradually change. It is also necessary to take into account that a small enterprise and a huge corporation strive for completely different things.
This means that it is possible to understand what a financial director should know and do by finding the functions that remain unchanged throughout the life of the company. At the same time, it is important to consider that the stated goals and the tools used to achieve them always change.
We are talking about the following functions:
ensuring the enterprise's need for financial resources;
planning, monitoring the company's work;
ensuring business efficiency;
providing information to decision makers;
Ensuring the company's economic security.
shell companies were used;
the tax authorities were given knowingly false information;
illegal business fragmentation was used;
data on taxable objects were deliberately distorted;
the tax benefit was applied unlawfully;
the transaction was not properly executed.
To avoid the company's CFO having to business owner database answer for the chief accountant's mistakes, their powers must be immediately delineated. It is equally important to record the responsibilities of each of these specialists in job descriptions and employment contracts.
Civil liability of the financial director
An enterprise can file a lawsuit to recover losses related to the intentional actions or lack of necessary competence of the financial director. For example, the manager did not pay taxes, behaved negligently. But to do this, the company will need to prove the connection between the actions of this employee and its losses.
Recommended articles on this topic:
Marketing Department KPI: 11 indicators and calculation example
Employee's material liability: what theory, practice and the courts say
Anti-crisis financial management: tasks, stages, solutions to problems
Goals and objectives of the financial director
Often we have to face a situation when this specialist is assigned different functions, which is why there is a misunderstanding between the parties when hiring. As a result, holding the CFO's resume in his hands, the CEO does not know what tasks he should give to this specialist, what powers to grant him. While the applicant himself does not know what the new management wants to get from him, whether he will be able to satisfy such requests. As a result, the head of the HR department does not understand who he should find and how to determine that the candidate is suitable.
But since the issue needs to be closed in any case, when selecting a candidate for such an important position, they most often rely on formal characteristics. These include the education and training completed by the financial director, work experience. They may even ask whether the applicant is able to explain what a certain coefficient means. However, one should not hope that such an approach will yield a good result.
Goals and objectives of the financial director
It is important for any company to find a professional, because such a person knows exactly what and why he is doing, what effect he will get from it. It is not enough for a company's financial director to have a set of special knowledge, he also needs skills that will allow him to lead the company to the desired result.
Let's explain the principle of selecting this specialist using an analogy with choosing a professional boxer for a bet on a totalizator. It is obvious that the athlete knows many different punches and has several signature moves, in other words, has a lot of tools. However, this indicator does not matter - what matters is whether the boxer is able to defeat the opponent. And here it does not matter what punches he decides to use - this person is obliged to show his ability to win. Therefore, during the introduction of boxers, only height, weight, age, number of victories and defeats are mentioned. And only during the fight, commentators talk about the nuances associated with a specific fighter.
It is important that the candidate for the position clearly sees his goals. However, the development of the company leads to the fact that the guidelines gradually change. It is also necessary to take into account that a small enterprise and a huge corporation strive for completely different things.
This means that it is possible to understand what a financial director should know and do by finding the functions that remain unchanged throughout the life of the company. At the same time, it is important to consider that the stated goals and the tools used to achieve them always change.
We are talking about the following functions:
ensuring the enterprise's need for financial resources;
planning, monitoring the company's work;
ensuring business efficiency;
providing information to decision makers;
Ensuring the company's economic security.