M&A Information Technology Best Practices

Chapter 19

The Role of CFO

Rich RoremTrevear ThomasNnamdi LowrieHeith RothmanVenkat SwaminathanChelsea GorrJenny XuMia Velasquez

The chief financial officer (CFO) plays multiple critical roles in a company's M&A transaction. CFOs have responsibility for the large number of M&A activities that directly impact the finance organization, finance support services, and many cross-functional deal activities. In addition, they often have a broader overall role in the deal transaction planning and execution. The CFO is one of the key decision makers and influencers in the overall deal structuring, due diligence, and negotiations. Often, the CFO is one of the first executives brought into a transaction and has ultimate responsibility for the financial success of the transaction. In large M&A transactions, the process from due diligence to full integration can take many months and consume the organization in integration activities geared to creating the newly combined entity. This makes the CFO role extremely challenging, as CFOs must balance transactional activities in addition to their normal corporate, operational, and functional responsibilities.

Given the CFOs' varied roles, it is important that they have significant interaction with other functional areas to help ensure the deal's success. Exhibit 19.1 depicts the key CFO roles and activities and potential areas where there is cross-functional collaboration across the M&A lifecycle.

Exhibit 19.1 Typical Acquisition Lifecycle and Cross-Functional ...