On The Current Appointment System Of Chief Financial Officer

The current financial supervision mechanism of state-owned enterprises is composed of external supervision and internal supervision.

External supervision mainly takes the departments in charge of enterprises and government supervision departments (such as finance, taxation, auditing, banking, etc.) as the main body, and conducts regular or one-time examination and supervision. Internal supervision mainly carries out regular supervision by the accounting department, auditing department, supervisory board (company organization) and the workers' Congress.

From the theoretical point of view, the financial supervision mechanism of state-owned enterprises is consistent with objective reality.

However, in the operation of specific supervision, it failed to give full play to its due role.

The main manifestations are as follows: (L) as the main body of supervision, the government, supervisory departments and the state-owned enterprises and their responsible persons are actually in the status of agents.

The absence of owners of state assets does not mean owners' supervision of operators, which inevitably leads to ineffective supervision.

(2) there is correlation and dependence between local governments, government supervision departments and state-owned enterprises, which is not conducive to the role of supervision.

(3) information asymmetry between the supervision body and the supervised object.

Because financial supervision is a very meticulous and complex work, the indirect management of state-owned enterprises by government departments is not enough to obtain the information needed for direct supervision. Government departments are at a disadvantage of information compared to state-owned enterprises.

Even if the government supervision departments exercise their supervisory rights with a high sense of responsibility and dedication, the result can only be objective supervision.

(4) in the enterprise, the internal functional departments such as accounting and auditing should be given to supervise the institutional arrangement of the financial behavior of the director (Manager), which is contrary to the hierarchy principle of the enterprise management (subordinates subordinate to superiors).

The result must be: "unable to stand up enough to stand."

Therefore, in order to strengthen the financial supervision of state-owned enterprises and put forward the management method of improving financial supervision, the appointment system of chief financial officer is one of the most important methods.

The system of chief financial officer, two, the financial accounting system of the company, that is, the state, with its owner's status, assigned the chief financial officer to the wholly state-owned and holding enterprises by the relevant departments of property rights and government departments, and participated in the operation of the enterprises.

This is a system of financial supervision and management of state-owned enterprises or state holding enterprises based on the current economic system and political system and the reality of state-owned enterprises, aiming to reconstruct the financial supervision mechanism of state-owned enterprises.

It is a supervision of external property rights, which is derived from capital power. It is in line with the characteristics of state capital operation and is also in line with the reform direction of establishing a modern enterprise system.

Therefore, the government's property management department, financial management department and enterprise group authorized the chief financial officer to supervise the enterprise and strengthen the enterprise constraint mechanism.

The chief financial officer appointed by 1. is involved in examining and approving the major business decisions of enterprises, supervising and managing the daily financial activities of enterprises, solving the problem of asymmetric information between enterprises and government regulators, and solving the problem of man-made distortion of accounting information.

2. the chief financial officer's joint signing system has formed the internal power balance mechanism that the chairman, the general manager and the chief financial officer restrict each other, thus forming an organic supervision system with institutional and organizational guarantee, which can effectively prevent the loss of state assets.

The qualification and appointment of the chief financial officer of 3. are mostly the result of the joint recognition of the Organization Department, the financial department, the State Assets Department and the board of directors of the enterprise. This is a major pformation of the state's management mode of state-owned enterprises, and a major reform of the management system of the leading bodies of state-owned enterprises, creating conditions for the separation of government and enterprises.

The chief financial officer of 4. is formally appointed by the board of directors in compliance with the relevant provisions of the company law.

In terms of 5. inauguration, there is no big difference between CFO and chief accountant.

For example, audit the financial statements and reports of the group company, and be responsible for the quality of the financial statements and reports jointly with the general manager of the group company.

Take part in the examination and approval of the financial management regulations and other economic management systems of the group company; take part in the examination of the major financial decisions of the group company, examine and approve the major business, investment and financing plans of the group company, and participate in the formulation of the profit distribution plan and the plan for making up the losses of the group company; inspect the legality, authenticity and effectiveness of the financial accounting activities and related business activities of the group company in accordance with the law, and discover and stop in time the act of violating the state financial laws and regulations and the business behaviors that may cause significant losses to the investors; and so on.

In short, both of them are senior managers who manage and monitor the financial and accounting activities of an enterprise. The analysis and evaluation from the principle of streamlining and efficiency can be combined into one, so as long as a slight adjustment is made in terms of appointment procedures and supervisory power, there is no need to co-exist.

In the process of exploring and managing the accounting information distortion and financial management confusion in the three years, the establishment of a financial controller appointed by the government management department and enterprises is only a temporary solution.

Because from a deep level analysis, violation of financial law and discipline, confusion of accounting order, distortion of accounting information and other issues are only phenomena, and its essence is the failure of internal control system.

The deeper reason for the failure of internal control system is the serious agency problem caused by unclear property rights of state-owned enterprises.

"Falsification accounts", "false numbers" and "false statements" appear to be accountants' dereliction of duty. In fact, business managers fail to observe or knowingly commit crimes.

To strengthen the accounting control of enterprises, the premise is to establish and perfect the internal control system as the internal requirement of enterprise managers, which depends on the reform of the property right system of enterprises, and enables enterprises to truly become the micro subject that meets the requirements of market economy through reform.

Only in this way, enterprise managers will have the inherent motivation to establish and implement the internal control system including accounting control system, so that accounting work can be standardized.

We believe that with the maturity and perfection of the legal system of the socialist market economy, the separation of government and enterprises and the perfection of corporate governance structure, the rule of law is the basis for financial supervision and management of enterprises.

Under the circumstances of large scale changes in the property rights system of large state-owned enterprises and enterprise groups, we should take the opportunity of the implementation of the new accounting law to actively implement the appointment system of the chief financial officer and do a good job in the basic accounting work.

At the same time, we need to: 1. cultivate advanced financial accounting personnel as soon as possible.

Because of the perfect and healthy development of the appointment system of CFO, it is based on the cultivation of senior talent market.

Without high-quality personnel, the appointed chief financial officer can only have his name, which can not play its due role. The state assets are still running away, and accounting information is still distorted.

2. improve the social supervision and administrative supervision of the chief financial officer.

If the appointed chief financial officer fails to supervise the evaluation system, he will inevitably unite with the leaders of the unit and make joint fraud so as to legalize corruption.

If the chief financial officer is found to have committed an illegal act during his employment, he should be severely punished by law.

(Luwan District Financial Bureau)