What's the Difference Between a CFO and an Accountant?

By Martin · Updated 2026-02-02

An accountant ensures your financial records are accurate, your taxes are filed correctly, and your statements comply with accounting standards. A CFO uses financial data to drive strategy — forecasting cash flow, managing risk, optimizing capital structure, and guiding major business decisions. The accountant looks backward to ensure accuracy. The CFO looks forward to create outcomes. Most contractors need both, but confuse one for the other.

I hear this question constantly from contractors, and it's not a dumb question. The lines blur because both roles deal with money, both deal with numbers, and in many construction companies, the same person does both jobs (usually poorly).

But the distinction matters enormously. Getting it wrong means you either overpay for the wrong skill set or — more commonly — you think you have financial leadership when you actually just have financial record-keeping.

What an Accountant Does

An accountant's job is accuracy and compliance. They ensure your financial records reflect reality and meet regulatory standards.

Core accountant functions:

Prepare and review financial statements (P&L, balance sheet, cash flow statement)
Ensure compliance with GAAP or other accounting standards
File tax returns and manage tax planning
Conduct or prepare for audits
Maintain the chart of accounts and accounting policies
Prepare year-end adjustments and work papers

In construction specifically:

Apply percentage-of-completion or completed-contract accounting methods
Calculate and report over/under billings
Prepare WIP schedules for CPA review
Handle job cost accounting and allocation
Manage retention accounting
Prepare bonding financial statements (CPA-reviewed or audited)

A good construction accountant (or CPA) is essential. If your financial statements are wrong, every decision based on them is wrong too. But accuracy is the floor, not the ceiling.

What a CFO Does

A CFO's job is strategy and outcomes. They use financial data — the data your accountant produces — to drive decisions that improve the business.

Core CFO functions:

Build and maintain cash flow forecasts
Analyze project profitability trends and portfolio risk
Manage banking relationships (lines of credit, term loans, covenants)
Optimize bonding capacity with surety relationships
Evaluate major capital decisions (buy vs. lease, hire vs. outsource)
Guide pricing and bidding strategy
Plan for growth, succession, or exit

In construction specifically:

Interpret WIP trends to spot margin fade early
Manage billing strategy across the project portfolio
Model capacity constraints against backlog
Advise on which projects to pursue based on financial impact
Structure the balance sheet to maximize bonding
Forecast labor and equipment needs against financial capacity

The Gap Most Contractors Fall Into

Here's the pattern I see in almost every contractor under $30M:

They have a bookkeeper who handles day-to-day transactions. They have a CPA who does their taxes and maybe produces reviewed financial statements for the surety. And they assume that's "having their finances handled."

It's not. What they're missing is anyone asking — and answering — forward-looking questions:

"What happens to our cash position if we win this $8M bid?"
"Can we afford to hire two more project managers before the work materializes?"
"Our gross margin dropped 3 points this quarter — is that a trend or an anomaly?"
"If our largest client pays 15 days slower next quarter, do we have a problem?"

Your accountant can tell you what happened. Nobody is telling you what's going to happen. That gap is where expensive surprises live.

A Practical Example

Your CPA prepares your year-end financials and notes that your gross margin was 14.2%, down from 16.8% the prior year. They report this accurately. They might even mention it in their management letter.

A CFO would have caught that trend in Q2 — not at year-end — by monitoring WIP margins monthly. They would have identified which jobs were underperforming and why. They would have recommended corrective actions: renegotiate a subcontract, submit pending change orders, adjust the cost-to-complete estimate and have a hard conversation with the PM. By year-end, the margin decline might have been 1 point instead of 2.6 points. On $20M in revenue, that's $320K in profit your accountant accurately reported as lost, and your CFO could have saved.

Can Your CPA Be Your CFO?

Some CPAs offer "advisory services" that venture into CFO territory. This can work, with caveats:

It works when:

Your CPA has deep construction industry experience
They're proactively contacting you between tax seasons
They're building forecasts, not just reporting history
They understand bonding relationships and banking covenants
They're engaged monthly, not just quarterly or annually

It doesn't work when:

They treat construction like any other industry
You only hear from them at tax time and year-end
Their "advisory" is just a management letter attached to the financial statements
They don't understand WIP accounting at a strategic level
They've never talked to your banker or surety agent

Most CPA firms, even good ones, are structured around compliance work. Advisory requires a different mindset, different cadence, and different skill set. Some firms do it well. Most don't.

What About a Controller?

A controller sits between an accountant and a CFO. They manage the accounting function (like an accountant) but also produce management reports and maintain more sophisticated financial tracking (closer to a CFO).

The hierarchy, simplified:

Bookkeeper — Records transactions
Accountant/CPA — Ensures accuracy and compliance
Controller — Manages the accounting function and produces management reports
CFO — Uses financial data to drive strategy

Most contractors skip from bookkeeper straight to CPA and wonder why they don't have financial visibility. The missing layers — controller and CFO — are where operational insight and strategic direction come from.

The Bottom Line

Your accountant tells you the score. Your CFO calls the plays. You need someone keeping score accurately — that's non-negotiable. But if no one is using the score to make strategic decisions, you're playing defense with your eyes closed.

If the only time you discuss your financials in depth is during tax season or your annual CPA review, you have an accounting relationship, not a financial leadership relationship. Both are necessary. Only one drives the business forward.