Hiring guide
An outsourced finance responsibility matrix: prepare, review, approve
By CFO Index · Published
When an accountant, a fractional CFO and an internal team all contribute to finance, 'the provider handles it' leaves too much unclear. Build a responsibility matrix around actual deliverables. For each one, name who prepares it, what a reviewer checks and who has authority to approve its release or the resulting action.
Make each row specific enough to accept or reject
Use 'weekly cash forecast for Entity A, updated through Friday' rather than 'cash flow'. Record the period, entity, input owner, due time and acceptance evidence. The preparer creates the output. The reviewer performs the agreed checks and records exceptions. The approver authorises the specified use or action within their existing authority. Receiving a file is not the same as reviewing it, and reviewing a payment proposal is not authority to release money.
Use a small matrix to expose gaps
These are illustrative assignments for a company with an internal finance operator, an external accountant and a fractional CFO. Replace roles with named people and confirm capacity, competence and authority. The entries do not transfer statutory duties, grant banking permissions or establish assurance. Preparation and approval may need more detailed separation in your own control design.
| Deliverable | Prepares | Reviews | Approves or authorises |
|---|---|---|---|
| Monthly account reconciliations | External accountant | Accounting lead checks balances and exceptions | Internal finance owner accepts the reporting input |
| Weekly cash forecast | Internal finance operator | Fractional CFO challenges collection dates and commitments | Managing director decides proposed management actions |
| Supplier payment proposal | Internal finance operator | Designated reviewer checks invoices, payees and approval evidence | Existing authorised bank signatory releases payments under company controls |
| Management reporting pack | Fractional CFO coordinates the pack | Accounting and operational owners confirm their sections | Named executive approves circulation to the agreed audience |
Define the evidence behind a tick in the matrix
For a hypothetical weekly cash forecast, preparation evidence could be the dated file and a list of source inputs. Review evidence could identify the material receipts challenged, corrections made and unresolved assumptions. Approval evidence should identify the exact version and the decisions authorised, not just an email saying 'looks good'. Keep the review proportionate to the decision and agree its scope; a management check should never be described as an audit or independent assurance.
Test one failed hand-off before the next deadline
Ask what happens if an essential customer receipt is still unconfirmed when the forecast is due. Who contacts the customer owner, who labels the assumption and who decides whether to use a provisional report? Give the escalation a named recipient and deadline. Mark a row blocked or provisional where appropriate rather than recording completion because a document exists. This test reveals whether the preparer can obtain help or is simply accountable for inputs outside their control.
Do not call self-review an independent check
In a small team, the same person may prepare and inspect their own work. Make that limitation explicit. Decide which material outputs need another suitably competent reviewer and whether the engagement includes that capacity. Adding the CFO's name to every review column is ineffective if they never receive the file or cannot meet the deadline. Confirm cover during absence and align system access with the task; the matrix is not permission to share credentials or bypass an approval workflow.
Connect responsibilities to the signed scope
ICAEW's Practice Assurance guidance for its firms calls for clear engagement terms and adequate resources, and says changes in service scope should be agreed in revised terms. Use that as professional context, not a claim that every CFO provider is subject to ICAEW rules. Discuss any matrix row that neither your team nor a provider has accepted. Record additional work and fees before assuming a reporting engagement also includes bookkeeping, payment execution or local tax filings.
Review the matrix against a completed cycle
After one reporting cycle, compare the named assignments with what actually happened. Look for unassigned inputs, duplicated checks and approvals attached to the wrong version. Amend responsibilities by agreement and retain the previous version so the effective date is clear. A useful matrix lets a colleague explain the next hand-off and find evidence of the last one. It should make ownership observable, not add a second reporting process nobody maintains.