The CFOs Guide to Measuring the Finance Function

The CFOs KPI Fact Sheet 100 KPIs The ten KPIs of the The ten KPIs for successful The ten KPIs for successful The ten KPIs for successful The ten KPIs for successful
to keep the company on track successful FP&A team financial reporting risk management cash management capital management
Budget Variance Reporting Accuracy Risk Exposure Cash Conversion Cycle (CCC) Return on Capital Employed (ROCE)

Financial Planning & Analysis Measures the variance between the actual financial results and the
budgeted figures. It provides insight into the accuracy of the budgeting
Measure the accuracy and reliability of financial reports. It can be
assessed by comparing reported financial figures with actual results,
The amount of risk exposure that the organization faces, as measured by
a risk exposure score, can be an essential KPI to measure the effectiveness
The CCC measures the time it takes for cash to flow through the
organization, from the purchase of raw materials to the collection of
ROCE measures the profitability of capital invested in the
organization. It indicates how effectively the organization utilizes its
process and the ability to effectively manage and control expenses. conducting periodic audits, or tracking the number and severity of errors of risk management. The risk exposure score should reflect the cash from customers. A shorter CCC indicates more efficient cash capital to generate returns. This KPI compares the operating profit or
Budget Forecast Financial Cash flow or restatements. organization's risk appetite, risk tolerance, and risk management management and better liquidity. Track the CCC over time and net income to the capital employed and expresses it as a percentage.
ROI forecast objectives. compare it to industry benchmarks..
variance accuracy ratios
accuracy
Financial Ratios Compliance with Accounting Standards Risk Management Maturity Cash Flow Adequacy Capital Structure Ratios

Cost Financial Revenue Risk mngt. Various financial ratios can be used to measure the financial health and Assessing compliance with relevant accounting standards, such as GAAP The maturity of the organization's risk management process is a critical Assess the adequacy of available cash to meet short-term obligations Several ratios can provide insights into the organization's capital
planning NPS effective- efficiency of the organization. Examples include profitability ratios, or IFRS, is crucial for maintaining transparency and credibility. This KPI KPI. A higher maturity level indicates a more robust and effective risk and maintain sufficient liquidity. This KPI compares the organization's structure and its financial risk. These ratios include the debt-to-equity
control growth liquidity ratios, and efficiency ratios. evaluates adherence to accounting principles, disclosure requirements, management process. The maturity level can be assessed using a cash position against its short-term liabilities, ensuring that there is ratio, debt ratio, equity ratio, and gearing ratio. Monitoring these ratios
cycle time ness and industry-specific regulations. maturity model and benchmarked against industry best practices. enough cash on hand to cover immediate financial obligations. helps assess the balance between debt and equity financing.

Cash Flow Forecast Accuracy User Satisfaction Risk Identification and Assessment Days Sales Outstanding (DSO) Economic Value Added (EVA)
Assessing the accuracy of cash flow forecasts helps determine the Measure stakeholder satisfaction with financial reports through surveys or The number of risks identified and assessed over time is a crucial KPI to DSO measures the average number of days it takes to collect payment EVA measures the value created by the organization's operations after

Financial reporting organization's ability to manage its cash resources effectively. It measures
the ability to project cash inflows and outflows accurately, aiding in cash
feedback mechanisms. This KPI assesses the usefulness, clarity, and
relevance of the information provided, ensuring that stakeholders can
measure the effectiveness of risk management. This KPI measures the
organization's ability to identify and assess risks in a timely and
from customers after a sale. A lower DSO indicates faster cash conversion
and improved cash flow. Track DSO regularly to identify trends and
considering the cost of capital. It takes into account both the profitability
and the cost of capital employed. Positive EVA indicates value creation,
management. easily interpret and make informed decisions based on the reports. comprehensive manner. implement strategies to reduce collection times. while negative EVA suggests value destruction.
Repor-ting Audit
Timeliness Com-pliance User NPS
accuracy opinion
Financial Planning Cycle Time Transparency and Disclosure Risk Reporting Cash Burn Rate Payback Period
Ease of Stake- Measures the time it takes to complete the financial planning cycle, from Assess the level of transparency and quality of disclosures in financial The quality and timeliness of risk reporting is a KPI that measures the The cash burn rate measures the rate at which the organization consumes The payback period measures the time required to recoup the initial
Trans- Adherence budget preparation to reporting and analysis. It assesses the efficiency of reports. This KPI measures the comprehensiveness and clarity of effectiveness of risk management. This KPI measures the accuracy, its cash reserves. This KPI is particularly relevant for start-ups and investment through cash flows generated by a project or investment.
Data to under- holder the FP&A processes and the timeliness of financial information. information provided regarding accounting policies, significant events, completeness, and relevance of risk reports and the frequency with organizations going through rapid growth phases. Monitoring the cash Monitoring the payback period helps assess the speed at which capital is
integrity parency
guidelines standing feed-back risks, and uncertainties. which they are produced. burn rate helps ensure that cash reserves are sufficient. recovered and the risk associated with the investment.

Revenue Growth
Assessing revenue growth measures the success of financial planning
in driving top-line growth. It evaluates the effectiveness of revenue
forecasting, pricing strategies, and market expansion initiatives.
Risk management
Accessibility and Ease of Understanding
Evaluate the accessibility and readability of financial reports. This KPI
considers factors such as the use of plain language, clear formatting, and
effective data visualization techniques to ensure that stakeholders can
easily comprehend the information presented.
Compliance
The level of compliance with relevant regulations and standards is
another KPI to measure the effectiveness of risk management. This KPI
measures the organization's adherence to legal, regulatory, and industry
standards related to risk management.
Cash Flow Return on Investment (CFROI)
CFROI measures the return generated on the cash invested in the
business. It compares the cash flow generated by the business to the
amount of cash invested. A higher CFROI indicates better utilization
of cash resources.
Market Capitalization
Market capitalization represents the total market value of a company's
outstanding shares. Monitoring market capitalization provides insights into
the perception of the market regarding the organization's value and
performance.

Risk Risk Risk Forecast Accuracy Timeliness of Reporting Risk Reduction Cash Flow Forecast Accuracy Weighted Average Cost of Capital (WACC)
Process
Maturity identify-
exposure reduction efficiency Assesses the accuracy of financial forecasts by comparing projected Evaluate the ability to provide financial reports within predefined The reduction in risk exposure over time is another KPI that can measure Measure the accuracy of cash flow forecasts by comparing projected cash WACC represents the average rate of return required by investors and
cation financial results to the actual outcomes. A high forecast accuracy deadlines. It measures the efficiency of the reporting process and ensures the effectiveness of risk management. This KPI can be measured by flows to actual cash flows. This KPI assesses the organization's ability to lenders to provide funding to the organization. Monitoring the WACC
indicates the quality of financial projections and the ability to anticipate that stakeholders receive timely information for decision-making. comparing the risk exposure score over time or by measuring the accurately predict cash inflows and outflows, helping identify areas of helps assess the cost of capital and whether it aligns with the
Stake- future performance. reduction in the number of high-risk events. improvement in forecasting methodologies. organization's expected return on investment.
Risk Risk Business External
holder
mitigation reporting continuity compliance
confidence Return on Investment (ROI) Audit Opinion Risk Management Process Efficiency Cash to Current Liabilities Ratio Return on Equity (ROE)
The return generated from investments made by the organization. It Consider tracking the audit opinion received from external auditors. A The efficiency of the risk management process is another critical KPI. This ratio measures the organization's ability to meet its short-term ROE measures the profitability of the organization for the shareholders. It
evaluates the effectiveness of financial planning decisions in allocating favorable opinion indicates that the financial statements are presented This KPI measures the time, resources, and costs required to complete obligations using available cash. It compares the total cash balance to the indicates how effectively the organization utilizes shareholder equity to
resources to initiatives. fairly and in accordance with applicable standards. It demonstrates the the risk management process. It can be measured by the number of risk current liabilities, providing an indication of the organization's liquidity generate returns. This KPI compares the net income to the average
quality and reliability of financial reporting. management tasks completed within a specified time period strength. shareholders' equity and expresses it as a percentage.

Cash management
Cost Control Data Integrity Risk Mitigation Days Payable Outstanding (DPO) Capital Efficiency Ratio
Cash Cash flow Cash to Evaluates the effectiveness of cost management efforts. It measures the Evaluate the accuracy and completeness of financial data used for The effectiveness of risk mitigation measures is another KPI that measures DPO measures the average number of days it takes to pay suppliers after This ratio assesses how efficiently the organization utilizes its capital to
conversion forecast Cash flow current DSO ability to control and reduce costs while maintaining the desired level of reporting. This KPI assesses the effectiveness of internal controls, data the effectiveness of risk management. This KPI can be measured by the receiving an invoice. Extending DPO can improve cash flow by maximizing generate revenue. It compares revenue or operating income to the total
cycle accuracy adequacy liabilities operational efficiency. validation processes, and reconciliation procedures in maintaining data reduction in the likelihood or impact of high-risk events or the percentage the time available to pay bills. However, it should be balanced with capital employed, providing insights into the productivity and efficiency
integrity throughout the reporting cycle. of high-risk events that were mitigated. maintaining good vendor relationships. of capital allocation.

Cash burn Cash flow Liquidity Stakeholder Satisfaction Adherence to Reporting Standards and Guidelines Business Continuity
DPO CFROI Cash Flow Margin Capital Asset Pricing Model (CAPM)
rate margin ratios
Measures the satisfaction level of stakeholders (such as executives, board Measure the extent to which reporting guidelines and internal reporting The ability of the organization to continue its operations during and after If the organization engages in cross-border transactions with related CAPM measures the expected return on equity based on the risk-free
members, and department heads) with the financial planning and analysis policies are followed. This KPI assesses consistency in reporting formats, a high-risk event is a crucial KPI to measure the effectiveness of risk Cash flow margin measures the percentage of revenue that converts rate, market risk premium, and beta of the organization's equity. It
outputs. It can be assessed periodically in surveys and other feedback templates, and disclosure requirements across different reporting periods management. This KPI measures the organization's resilience and the into cash flow. It indicates the organization's ability to generate cash helps evaluate the expected return on equity given the systematic risk
mechanisms. and entities within the organization. effectiveness of its risk mitigation measures from its core operations. A higher cash flow margin indicates better associated with the organization's operations.
cash generation and management.

Risk Management Effectiveness Internal and External Stakeholder Feedback Stakeholder Confidence Liquidity Ratios Capital Allocation Effectiveness
Capital management Measures the effectiveness of risk management practices incorporated Seek feedback from both internal and external stakeholders, such as The level of stakeholder confidence in the organization's risk Various liquidity ratios, such as the current ratio (current assets divided Assess the effectiveness of capital allocation decisions by comparing
into financial planning and analysis. It assesses the ability to identify, executives, board members, investors, and regulatory bodies. Their input management process is a KPI that measures the effectiveness of risk by current liabilities) and the quick ratio (quick assets divided by current the actual returns generated from investments or projects to the
Capital assess, and mitigate financial risks and uncertainties. can provide valuable insights into the effectiveness and usefulness of management. This KPI can be measured through e.g., surveys that assess liabilities), provide insights into the organization's ability to meet short- expected returns. This could be done through analyzing the variance
ROCE WACC structure ROE EVA financial reporting. stakeholders' perceptions of the organization's risk management process. term obligations. These ratios assess the adequacy of liquid assets between projected and actual financial performance for each
available. investment or project.
ratios
Capital Capital
Payback Market cap
efficiency CAPM allocation
period
ratio quality

The ten KPIs for successful The ten KPIs for successful The ten KPIs for successful The ten KPIs for successful The ten KPIs for successful
Tax management
tax management investor relations corporate governance strategic planning leadership and management
Tax Effective Effective Tax Rate (ETR) Investor Perception Board Effectiveness Goal Achievement Employee Engagement
Effective
compliance Tax tax rate vs. Audit risk ETR measures the organization's tax liability as a percentage of its pre-tax Evaluate the performance and effectiveness of the board of directors by Assess the organization's progress in achieving its strategic goals Measure the level of employee engagement within the organization.
tax rate savings
Conduct regular surveys or interviews with investors, analysts, etc. to
assessing factors such as board composition, diversity, and expertise. and objectives. Measure the completion of key milestones, targets, Conduct employee surveys to assess their satisfaction, motivation, and
rate statutory profits or income. Comparing the ETR to industry benchmarks and assess their perception of the company's management, strategy, and
Measure the frequency and quality of board meetings, the level of or initiatives that were defined during the strategic planning process. commitment. Track metrics such as employee retention rates,
historical data can provide insights into the organization's tax efficiency financial performance. Measure key attributes such as trust, confidence,
engagement during discussions, and the ability to make informed This KPI provides an overall indication of the success of strategic absenteeism, and participation in training and development programs.
and effectiveness of tax planning strategies. and satisfaction to gauge the effectiveness of investor relations efforts.
Timeliness Comms with Transfer decisions. execution.
Tax risk Employee
pricing
of filings authorities mngt. taxes
compliance Tax Savings Investor Engagement Ethical Compliance Market Share Talent Development and Succession Planning
Calculate the amount of tax savings achieved through effective tax Measure the level of engagement with investors through various channels Monitor compliance with ethical standards and code of conduct by Measure the organization's market share or market position in relevant Assess the effectiveness of leadership and management in identifying
planning strategies. This KPI compares the organization's tax liability such as one-on-one meetings, conference calls, investor events, and tracking the number and severity of ethical violations, conflicts of interest, markets or segments. Monitor changes in market share to evaluate the high-potential employees, providing them with growth opportunities,
based on actual tax returns with an estimated tax liability without the webcasts. Track the frequency and quality of interactions with investors to and incidents of misconduct. Measure the effectiveness of training success of strategic efforts in capturing market opportunities, and preparing them for future leadership roles. Track the number of
implemented tax planning strategies. evaluate the effectiveness of relationship-building efforts. programs and awareness campaigns in promoting ethical behavior. outperforming competitors, or expanding into new markets. internal promotions and succession planning initiatives.

Investor relations Audit Risk Media Coverage Shareholder Engagement Employee Engagement Employee Turnover and Retention
Assess the risk of tax audits or disputes by monitoring the number and Assess the extent and tone of media coverage related to the company. Evaluate the level of shareholder engagement by measuring the Measure employee engagement levels to gauge the alignment A low turnover rate indicates effective leadership and management
Investor Share Investor Analyst Media severity of tax audits, the outcome of audits, and any tax-related disputes Monitor the frequency of press releases, news articles, and mentions in frequency and quality of communication with shareholders. Monitor between the strategic plan and employee motivation and practices that foster a positive work environment and promote employee
perception holder base engagement coverage coverage or litigations. A lower audit risk indicates effective tax compliance and financial publications. Evaluate the sentiment of media coverage to gauge the attendance and participation in annual general meetings (AGMs), commitment. Conduct surveys or assessments to evaluate employee loyalty. Measure the percentage of employees who voluntarily leave the
management practices. the effectiveness of investor relations in managing the company's public the number of votes cast, and the level of shareholder support for satisfaction, morale, and understanding of the strategic direction. organization and track retention of key talent.
image. board resolutions.
Investor Capital
Earnings call relations Analyst Regulatory
website
market Effective Communication with Tax Authorities Investor Relations Website Analytics Transparency and Disclosure Time-to-Market Financial Performance
participation consensus compliance
analytics percep-tion Evaluate the organization's ability to effectively communicate and Track website analytics to assess the level of engagement with the Evaluate the level of transparency and disclosure by assessing the Assess the time it takes to bring new products, services, or strategic Measure metrics such as revenue growth, profitability, and return on
collaborate with tax authorities. Monitor the response time to tax investor relations section of the company's website. Monitor metrics such comprehensiveness and clarity of corporate communications. Measure the initiatives to the market. Measure the speed of execution and investment. Effective leadership and management practices contribute
authority inquiries, and the rate of successful resolutions of tax issues. as the number of unique visitors, page views, and time spent on the adequacy of disclosures related to financial performance, strategic compare it to industry benchmarks or historical data. A shorter time- to sound financial management and achievement of financial goals.
This KPI reflects the organization's relationship with tax authorities. website. Analyze the content accessed, to evaluate the relevance and initiatives, executive compensation, and risk factors. to-market indicates effective strategic planning and execution.
effectiveness.

Risk Management
Corporate governance Tax Risk Management Analyst Consensus Accuracy Stakeholder Satisfaction Organizational Culture and Values
Evaluate the organization's ability to identify, assess, and mitigate
Monitor the effectiveness of tax risk management practices by assessing Track the accuracy of analysts' forecasts and consensus estimates for Conduct surveys or interviews with stakeholders to assess their Assess the alignment between the organization's culture and values with
TBoard Stake- the identification and mitigation of tax risks. This KPI measures the
strategic risks. Measure the number and severity of risks identified, risk
the leadership demonstrated by managers and executives. Monitor the
Board Ethical Risk mngt. the company's financial performance. Compare actual results with satisfaction with the organization's governance practices. Measure the
mitigation actions taken, and incidents avoided. Effective risk
holder organization's ability to identify potential tax exposures, implement analysts' projections to evaluate the quality of information provided by level of trust, confidence, and perception of fairness among stakeholders, extent to which leaders model the desired behaviors, reinforce the
effectiveness diversity compliance oversight management indicates the success of strategic planning in addressing
engagement controls to minimize tax risks, and resolve tax issues efficiently. the company and the effectiveness of managing analyst expectations. including employees, customers, suppliers, and the community.
potential threats.
organizational values, and create a positive and inclusive work culture.

Financial Board Tax Compliance Rate Shareholder Base Board Diversity Revenue Growth Employee Performance
reporting Transparacy Regulatory Stake-holder training & Measure the organization's compliance with tax laws and regulations by Monitor the composition and changes in the shareholder base over time. Monitor the diversity of the board in terms of gender, ethnicity, skills, Track the organization's revenue growth over time to assess the impact Evaluate individual and team performance to assess the effectiveness of
& disclosure compliance satisfaction development tracking the percentage of tax filings submitted accurately and on time. A of strategic initiatives. Compare current revenue figures with historical leadership and management. Monitor metrics such as productivity, quality
accuracy high compliance rate indicates effective tax management practices and
Track the number of new investors and changes in ownership and experience. Measure the representation of diverse backgrounds
data or industry benchmarks to evaluate the effectiveness of the of work, and achievement of targets. A well-performing workforce is
concentration. Analyze the diversity and stability of the shareholder base on the board to ensure a broader range of perspectives and avoid
reduces the risk of penalties or audits. to assess the effectiveness of attracting and retaining investors. groupthink. strategic plan in driving financial performance. indicative of strong leadership and management practices.

Effective Tax Rate vs. Statutory Tax Rate Analyst Coverage and Recommendations Risk Management Oversight Customer Satisfaction Employee Satisfaction and Feedback
Compare the effective tax rate to the statutory tax rate set by the tax Monitor the number of analysts covering the company and track their Assess the effectiveness of risk management practices by evaluating the Assess customer satisfaction levels through surveys, feedback, or Net Measure employee satisfaction through regular surveys or feedback
Strategic planning authorities. This KPI helps assess the organization's ability to optimize
tax planning strategies and take advantage of available deductions,
recommendations (buy, sell, hold). A higher number of analysts covering
the company and positive recommendations can indicate the effectiveness
identification, assessment, and mitigation of risks. Measure the frequency
of risk assessments, the implementation of risk mitigation strategies, and
Promoter Score (NPS) measurements. High customer satisfaction
indicates the effectiveness of the strategic plan in meeting customer
mechanisms. Monitor the satisfaction levels with leadership,
communication, recognition, and support. Analyze the feedback received
credits, and incentives. of investor relations in attracting analyst attention and support. the level of integration of risk management into decision-making. needs, enhancing customer experiences, and maintaining loyalty. and take necessary actions to address areas of improvement. practices.
Goal Revenue Market Customer Employee
achievement growth share satisfaction engagement Timeliness of Tax Filings Earnings Call Participation Financial Reporting Accuracy Return on Investment (ROI) Customer Satisfaction
Measure the timeliness of tax filings by tracking the percentage of tax Measure the participation and engagement of investors, analysts, and Measure the accuracy and reliability of financial reporting by assessing Calculate the return on investment for strategic initiatives or projects. Assess customer satisfaction levels to measure the impact of leadership
returns submitted before or on the due date. This KPI reflects the media in earnings conference calls. Monitor the number of participants the number and materiality of accounting errors, restatements, or audit Compare the financial benefits achieved against the resources invested and management on customer relationships. Monitor customer feedback,
Time-to- Innovation Stakeholder
ROI Risk mngt. organization's ability to meet tax deadlines, comply with reporting and overall level of engagement. Higher participation levels indicate qualifications. Monitor compliance with accounting standards and the to evaluate the effectiveness of resource allocation and the value conduct surveys, and track customer retention rates. A high level of
market metrics perception requirements, and minimize the risk of penalties. investor interest and the effectiveness of communication efforts. timeliness of financial reporting. generated from strategic investments. customer satisfaction is indicative of a customer-centric culture.

Transfer Pricing Compliance
Assess the organization's compliance with transfer pricing regulations by
evaluating the completeness and accuracy of transfer pricing
documentation. Measure the percentage of intercompany transactions
Leadership and management with proper documentation and compliance with arm's length pricing
guidelines.
Capital Market Perception
Monitor stock price performance and trading volumes to assess the
impact of investor relations activities on market perception. Evaluate the
correlation between major investor relations events and market reactions.
Positive market reactions may indicate effective communication.
Regulatory Compliance
Monitor compliance with applicable laws, regulations, and corporate
governance guidelines. Measure the number and severity of regulatory
issues or penalties to assess the organization's commitment to
compliance and adherence to governance standards.
Innovation Metrics
Track the number of new products, patents, or innovations introduced
as a result of the strategic plan. Measure the impact of innovation on
the organization's competitiveness and ability to differentiate in the
market.
Employee Development and Training
Track the number of employees participating in training programs, their
skill development progress, and the application of acquired skills in the
workplace. Assess the impact of training on employee performance and
organizational outcomes.

Employee Employee Talent Employee Employee

engagement performance development satisfaction turnover Employee Tax Compliance Regulatory Compliance Board Training and Development Stakeholder Perception Team Collaboration and Communication
Evaluate the organization's employee tax compliance by measuring the Monitor compliance with regulatory requirements related to investor Evaluate the effectiveness of board training and development programs Assess stakeholder perception and feedback through surveys or Monitor metrics such as cross-functional project success, teamwork
accuracy and timeliness of employee tax withholdings and reporting. relations, such as timely disclosure of material information and adherence by assessing the participation rate, feedback from directors, and the interviews. Measure stakeholders' understanding, support, and effectiveness, and employee feedback on communication channels.
Monitor the percentage of employee tax filings and payments made to reporting obligations. Measure the number and severity of regulatory application of acquired knowledge and skills in board activities. satisfaction with the strategic plan. Evaluate their perception of the Effective leadership promotes a collaborative work environment and
Customer Financial Employee Culture and Collaboration correctly and on time. issues or penalties to assess the effectiveness of compliance efforts. organization's strategic direction, transparency, and responsiveness. open communication channels.
satisfaction performance development values & comms

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