Xiao Ying: An excellent CFO must become the creator and leader of company value

In this era of "mass entrepreneurship and innovation", starting a business, attracting venture capital, and IPO have become the dreams of every entrepreneur.

"The company's IPO process is full of challenges for the entire team, especially the financial team. This is also a critical period that tests the team's cohesion and combat effectiveness."

This article is provided by teacher Xiao Ying

Recently, Xiao Ying, chief financial officer of a well-known domestic holding group, reminded CFOs to use his own personal experience Everyone, whether it is working in the early stage of an IPO or meeting corporate governance, information disclosure and compliance requirements after listing, the company needs to establish a professional, efficient, experienced, able to fight, good at chewing hard bones, with driving force and control finance team.

At the same time, the CFO is also required to have an in-depth understanding of the company's different historical development stages, ownership structure, business model and financial data changes, and understand the IPO process nodes.

"I hope that every outstanding CFO can lead the company to maneuver in the capital market and become the creator and leader of the company's value." Xiao Ying said.

A CFO must be proficient in "nineteen martial arts skills"

We all know that to describe a person with strong martial arts skills, they usually say He is "proficient in all eighteen kinds of martial arts". Xiao Ying said with a smile that when the company is promoting the IPO process, the CFO must make sufficient work and mental preparations, improve the ability to cope with pressure and handle complex emergency matters, and do the following 19 aspects of work well, which is one more skill than ordinary martial arts. Item:

Talent is the key resource for entrepreneurship. In terms of team building, Xiao Ying said that in order to meet the company's long-term development requirements, frequent personnel recruitment and position adjustments must be carried out. During the IPO process, financial personnel need to provide the information required by various intermediaries (such as audits, evaluations, internal controls, lawyers, sponsor teams, etc.) on time and with high quality and quantity. At the same time, we must also cooperate with the due diligence work of investors during the pre-IPO and financing stages.

"For financial personnel, the workload in the IPO stage increases sharply and they need to face huge pressure, but it is also a precious experience accumulation and rapid growth opportunity." Xiao Ying believes that it is necessary to have talents beyond the position. Competent and more professional financial personnel will remain in their posts and devote themselves to the IPO work.

In terms of corporate governance and independence, it is necessary to clarify the reasons for related-party transactions and whether the cross-linked transaction prices are fair.

In terms of changes in the equity structure, it is necessary to list the basis for previous share transfers, financing and pricing, procedures for adding new shareholders, shareholder related relationships, etc.

In terms of whether taxes are paid in full and whether there are tax risks, it is necessary to check whether there are tax defects and the need to pay back taxes or tax penalties; consider the group structure and Whether each company has risks in tax planning at home and abroad.

In terms of IPO timetable planning and node promotion, the CFO is responsible for promoting and supervising the entire IPO process, formulating a good listing timetable, collecting relevant documents and coordinating the promotion of resources from all parties to ensure that all intermediaries The team completed the tasks before IPO submission on time.

In addition, the CFO must coordinate with the intermediary teams of all parties, coordinate various professional participants, promote all parties to complete tasks on time, and respond to emergencies and emergencies. When it comes to deadlines, submit materials as early as possible and supervise progress as per the schedule.

In addition to preparing accounting reports, financial personnel must also assist in conducting feasibility studies and evaluate whether they can pass the profitability test. They must prepare reliable and verifiable profit and working capital forecasts, profit forecasts, and cash flow forecasts. The rationality of the data takes full consideration of the company's commercialization prospects, market positioning and market competitiveness, changes in business pipelines, product status in the commercialization stage, and status of ongoing research projects, etc. In addition, you should also refer to the valuation and stock price of the company's competitors.

In terms of the effectiveness of internal control, it is necessary to focus on inspecting the IPO audit and internal control team hired by the company to evaluate whether the business meets the listing requirements, and whether the financial reporting system, internal control and corporate governance are complete.

If equity incentives are set up, the equity incentive plan set up by the company for employees must be disclosed, as well as the equity grant time and amount, and the impact on the financial report for each year.

In terms of writing and checking listing application documents and prospectuses, Xiao Ying reminded the CFO that prospectuses test the keen business sense and insight of financial personnel. When writing a prospectus, you need to select the most advantageous selling points and focus on presenting them to investors; you must change your perspective at any time and view yourself and investors from the perspectives of sellers and buyers.

In answering the hearing of the regulatory agency, if the regulatory agency requires the company to provide additional explanations or clarifications, the CFO must think deeply about the logic behind the question, the background of the question, the reason and the purpose to be achieved. , how to respond more effectively within a tight time frame and achieve a state of satisfaction for regulatory agencies.

"If a company wants to go to the Hong Kong Stock Exchange or IPO in the United States, it will be exposed to all kinds of English information." Xiao Ying said that this requires financial personnel to have sufficient English proficiency, not only to understand emails, audit reports, legal documents, etc. You must be able to read and understand the English in documents and prospectuses, and you must also have the ability to communicate in spoken English with intermediaries.

Internal control construction is conducive to the long-term and stable development of enterprises

Enterprises need to submit internal control evaluation reports when they go public. . What key aspects should companies planning to go public grasp in terms of internal control construction?

Xiao Ying believes that during the listing process, the company will improve its business operations through guidance from itself and intermediaries, allowing the company to pay more attention to corporate governance, which will ultimately be beneficial to the long-term and stable development of the company.

During the IPO process, intermediaries will judge whether the company's internal control and corporate governance are complete, help the company to provide reminders on imperfections or flaws in internal control, and identify defects in internal control at the company level. Follow up on follow-up improvement measures; put forward suggestions for improving the internal control process, and establish various systems to manage risks and promote internal control to help protect the rights and interests of shareholders.

In terms of internal control system verification, the issuer should verify the establishment, soundness and actual operation of the internal control system for managing the aforementioned qualifications, licenses and certification certificates.

In terms of internal control implementation, the focus of inspection is implementation, supervision and rectification.

Do a good job in risk control and cultivate international perspective

A company becomes a public company after it goes public. As corporate exposure increases, how should CFOs broaden their horizons in terms of risk control, industry-financial integration, financing planning, and international perspectives?

Ringing the bell for listing is not the end, but the starting point and milestone of corporate development. Xiao Ying believes that after a company goes public, in terms of risk control, CFOs should pay attention to business and financial compliance, control risks, and nip risks in their infancy. Because risk control and compliance are the bottom line for a company's survival and development.

In terms of industry-financial integration, in addition to doing their jobs well and delving into professional knowledge, financial personnel should also learn more about industry information outside their major, including core technology protection, R&D capitalization, industry regulatory policies, and knowledge The impact of property rights protection, patent disputes, pricing systems, etc. on the company's future requires a strong accounting background and solid industry knowledge. Only by deeply integrating business and finance can financial personnel serve the business decision-making.

In terms of financing planning, the CFO must have the ability to tell stories, tell stories well, and have the ability to impress investors. How to help companies introduce strategic investors or partners with more favorable conditions and help further business development is a proposition that CFOs should consider. It is necessary to understand investors’ investment styles and preferences, keep abreast of capital market dynamics and financing methods, grasp the timing of financing, and be familiar with various listing regulations and regulatory rules.

It is necessary to cultivate the international perspective of the CFO, go out of the office more, make more friends from investment banks, intermediaries and peers, and communicate more.

Carry out road shows and improve investor relations. The CFO should actively search for cornerstone investors, be responsible for IPO roadshows, deal with the media and hold investor relations meetings, compile investor lists and price their shares.

In addition, market value must be maintained. Xiao Ying believes that how to manage and maintain market value well is the yardstick for evaluating excellent CFOs. The CFO should not be a "blocker" to the business, but should be a promoter of the company's progress, a creator and leader of value.