Hiring practices cracked: What are the top interview questions for CFO applicants?

Here at Future of SaaS, we’re all about ensuring SaaS founders and CEOs have the tools they need to hire for maximum success. A key component to this is found in your hiring process.

Chief finance officers are really an integral part of your SaaS puzzle. Mishandling or misspending of funds is one of the chief reasons why startups fail, so finding someone who not only knows their way around a balance sheet, but can also steer your financial strategy towards maximum growth is crucial.

But this is quite a potent cocktail of qualities. How can you ensure that the person you're hiring has them?

By asking the right questions. Luckily we’ve laid them out for you right here!👇

Interview questions for CFO: Soft skills

1. Tell me what our company does in your own words

A key quality in a good CFO: diligence.

It’s all good and well asking somebody if they have this quality point blank, but this more indirect question is a great way of testing whether this quality is present in their behavior. If they know your company by the back of their hand it’s a good sign.

2. Describe your main goals

The benefit of this question is twofold. Firstly, is the candidate a long-term thinker? A person who has goals usually has a long term plan for the future. When you a hire a CFO you have to be sure that the candidate won’t just be someone who is treading water.

Instead, they will have a long term plan for how funding from investors should be spent to achieve maximum, sustainable growth over time.

4. Pretend you’re in a sales meeting, pitch our company to me

A crafty question, as the candidate is revealing two things at once. One: they’re revealing the extent of their knowledge of your company, something which reveals diligence and preparation.

And secondly, They’re revealing that they’re a persuasive communicator. Your CFO might sometimes have to justify decisions in your company’s financial plan when challenged.

5. Pose queries that ascertain if your Chief Financial Officer is compatible with your company's culture.

Your CFO is taking on a major leadership role in your org. It's essential that they establish a good rapport with your team. Leadership is earned, not commanded. If your CFO is not a good cultural fit, it will disrupt communication between your CFO and your team.

Everyone has a slightly different management style, but good rapport is essential because it facilitates communication with your team members, ensuring that all teams are aligned with financial targets. This is an essential pillar of good leadership skills.

6. Recount an instance when you detected an issue, contemplated your possibilities, and opted for a successful resolution.

This may seem like a cliche interview question, but the fact is, it's more fitting than ever when it comes to hiring a CFO. Your CFO will likely be tasked constantly with overcoming obstacles, as with any professional.

The difference is that your CFO is dealing with big money and making decisions that could make or break your business. The ability to calmly weigh up problems and solutions is a must-have.

7. If you could alter something about the company what would it be?

Once again twofold benefits: the candidate reveals that they have the temerity and strength of character to offer up constructive criticism, an important quality to have in a high pressure job. Secondly, they’re showing that they’re coming into the role already with ideas for how to improve things.

8. Tell me something I know nothing about

This is a great way to determine whether the candidate is a well-rounded individual or not. But why do you need them to be well-rounded? Because it takes a combination of qualities to be a successful leader.

Someone who is simply good at crunching the numbers might not have the ability to point other individuals in the right direction. You're assessing to see if your candidate has a broad range of knowledge and expertise.

9. What did you do to reach your long-term targets in your last job?

Here you want to see evidence of past success, not just in getting through the tasks of the day, but also in carrying out long term projects. The candidate should be a long term planner to have the foresight to know how certain investments will pay off long-term.

10. What are your most significant accomplishments?

This will really give you insight into where your candidate places their priorities. Do they value monetary gain or do they value solid work practices and good morale?

Do they value individual achievement or do they think a person is only as good as their team? Whether you favor one over the other is up to you, but you should be very intentional about exactly the kind of person that you’re going after.

Finance-oriented questions

Now that you have an idea of the kind of person you’re dealing with, it’s time to assess professional competence.

1. What have you done in the past to ensure your company adheres to regulatory compliance?

This is an area that SaaS companies often overlook when hiring for a CFO role. Hiring the wrong person won't just mean potential financial ruin, it could also mean potential legal trouble if the candidate is not familiar with the latest regulatory compliance guidelines.

Ensure that they are not only familiar with this but that they also have a proven track record of carrying out the role whilst adhering to regulatory laws.

2. Describe how you would achieve accuracy and transparency when carrying out an organization’s financial reporting?

Following on from the above, the CFO candidate might know regulatory compliance inside out, but knowing something and practicing it can be two entirely different things. It’s important to get the candidate to demonstrate, in practical terms, how exactly they’re going to carry out the role.

3. How will the economic climate for SaaS businesses change over the next 24 months?

This question not only assesses industry knowledge but also an ability to adapt. As recent global crises have shown, SaaS companies can end up having to overhaul their business practices overnight.

Having some foresight into how the industry is likely to change will reveal a candidate who isn't likely to leave the company open to any nasty surprises along the way.

We cannot future-proof our products completely of course, but having some knowledge as to which way the wind’s blowing is going can go a long way towards future protection.

Equally, a good marker of a sound financial mind is the ability to look closely at the market and speculate. This helps to determine how company funds should be spent and invested and, and can potentially inform a key mergers and acquisitions.

3. Explain how to establish a successful budget

This is a great question as it allows the applicant to clearly express their understanding of the field. With their response, we can assess how they would put their conception of accomplishment into action in our organization.

4. How in the past have you reported financial outcomes to your C-Suite, board of directors, investors and external stakeholders?

Your candidate might have all the knowledge in the world, but if they don't have experience in communicating financial progress and forecasts to CEOs, a board of directors, and senior stakeholders, it can be very difficult to establish company goals and milestones.

They should demonstrate evidence of having had processes in place for communicating. What practices have they facilitated to ensure all those that need to know are aware of your financial situation?

5. How have you communicated bad news in prior roles, and how did this impact your organization?

When conducting a CFO interview, it’s crucial that you the interviewee report problems in a way that leads to practical solutions. This will require excellent problem solving skills.

So often the way that a problem is solved is dictated by how the problem is reported. Are they able to approach a problem with actionable solutions in mind? They should demonstrate evidence of having done so in the past.

6. In your previous roles, how have financial outcomes matched up to your forecasts?

Here you are assessing both the accuracy of the candidate's forecasting abilities, their industry knowledge, and their ability to follow through on meeting goals.

It’s important to note that you’re not necessarily looking for someone who has gotten it right every time, but rather someone who is able to steer the ship toward goals through realistic, data-driven forecasting.

7. How would you tackle financial forecasting for our organization? How would you align your team behind the figures?

Is the candidate capable of owning responsibilities and how do they see their role in the overall company? They must understand the overall impact that their role is going to have and they demonstrate that they understand the importance of aligning the whole org behind projections and goals.

8. How has data analysis informed your decision making in the past?

Being an astute data analyst is really integral to being an effective CFO. This is an essential component of performance assessment, monitoring cash flow, forecasting, and in putting together financial reports. The key skill is being able to establish initiatives for the future based on what the present situation tells us.

9. What does a successful finance operation look like and how have you rolled one out in the past?

You are assessing that the interviewee isn't just someone who's going to blindly follow directives, they actually have their own original ideas about how best to carry out the role. Without this, they are not going to be able to offer solutions when problems arise.

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