What Does a Construction CFO Actually Do?

By Martin · Updated 2026-02-02

A construction CFO translates financial data into strategic decisions. They manage cash flow forecasting, analyze WIP trends to identify margin fade early, optimize bonding capacity, maintain banking relationships, and guide major business decisions like acquisitions or succession planning. Unlike a controller who reports what happened, a CFO predicts what's coming and recommends action.

I've spent 20+ years working with construction companies, and the most common misconception I hear is that a CFO is just a glorified bookkeeper. That couldn't be further from the truth. Your bookkeeper records what happened yesterday. A construction CFO tells you what's coming next month and what you should do about it.

Why This Matters

In construction, you can be "profitable" on paper and still run out of cash before Friday payroll. You can have a full backlog and still lose money on every job. The difference between a $20M contractor that thrives and one that struggles usually isn't the quality of their work — it's the quality of their financial leadership.

A construction CFO provides the strategic financial backbone that turns good contractors into exceptional businesses. They're the person who knows whether you can afford that new crane, whether you should walk away from that public bid, and whether your bonding capacity will support your growth plans.

What a Construction CFO Actually Does

Day-to-day operational work:

WIP analysis — Not just running the report, but interpreting it. They spot margin fade before it destroys profitability, identify billing opportunities you're leaving on the table, and flag cost overruns early enough to fix them.
Cash flow forecasting — Building rolling 13-week forecasts that account for billing cycles, payment delays, mobilization costs, and seasonal patterns. This is how you avoid panic when the bank balance dips.
Project profitability analysis — Determining which project types, customers, or regions are actually making money. I've seen contractors surprised to learn their "bread and butter" work loses money once overhead is properly allocated.
Banking and surety relationships — Your banker and surety agent need regular communication, not just an annual check-in. A good CFO maintains these relationships proactively, positioning your company for when you need increased capacity.

Strategic decision support:

Bidding strategy — Should you bid that $15M job when you've never done anything over $8M? What margin do you need to make it worth the risk? Which jobs should you walk away from?
Pricing and estimating — Reviewing estimate assumptions, ensuring overhead allocation is correct, and building contingency into pricing based on historical performance data.
Capital decisions — Lease vs. buy equipment. Whether to invest in new facilities. How to structure debt to match cash flow patterns.
Growth planning — Determining realistic growth rates based on bonding capacity, labor availability, and working capital. Identifying when you need to add project managers or estimators before you have the revenue to support them.
Risk management — Evaluating contract terms, identifying high-risk projects, managing insurance and bonding costs, and building financial cushions for inevitable surprises.

How This Differs from a Controller or Bookkeeper

Your bookkeeper records transactions and reconciles accounts. They're essential but backward-looking.

Your controller produces financial statements, manages job costing, and ensures accounting compliance. They tell you what happened last month with accuracy and detail.

Your CFO uses that data to drive decisions. They tell you what's likely to happen next quarter, what it means, and what you should do. Here's a concrete example:

Bookkeeper records $2.3M in costs on the Municipal Center project
Controller produces a WIP report showing the job is 68% complete with $1.1M remaining budget
CFO notices the completion percentage is growing faster than revenue recognition, identifies that two subcontractor change orders haven't been billed yet, calculates you're sitting on $340K in unbilled work, and advises you to submit the change order documentation before month-end to improve your bonding position for the upcoming highway bid

Common Mistakes

Thinking you don't need a CFO until you're much larger. The companies that grow from $10M to $50M successfully almost always have CFO-level thinking in place before they hit $15M. The ones that struggle are trying to scale with controller-level financial leadership.

Assuming a CPA or controller can fill this role. They have different skill sets. I've seen excellent controllers who couldn't build a cash forecast to save their lives. I've worked with CPAs who understood tax law brilliantly but had no idea how to optimize bonding capacity.

Not involving your CFO in operational decisions. If your CFO only hears about new projects after you've signed the contract, you're missing half their value. They should be in the room when you're deciding whether to bid, what to price, and what contract terms are acceptable.

The Bottom Line

A construction CFO is your financial quarterback. They don't just report scores — they call plays, adjust strategy based on what the defense is doing, and make sure you're positioned to win not just this game but the entire season.

For contractors under $50M, you don't necessarily need a full-time CFO, but you absolutely need CFO-level thinking. Whether that comes from a fractional CFO, sophisticated financial tools, or a controller with strong strategic skills doesn't matter. What matters is that someone is thinking three moves ahead, not just recording the last move you made.

If you're making major business decisions based on gut feel rather than data, or if you're regularly surprised by your cash position, you need CFO-level support. The cost of not having it is almost always higher than the cost of getting it.