In the wake of numerous financial restatements — not to mention numerous high-profile bankruptcies — bookkeeping issues like earnings management and revenue recognition are getting a whole lot of attention these days.

Maybe too much attention. As CFO.com reported in “CFOs: The New Patsies?,” finance chiefs seem to be coming in for their fair share of blame for poor corporate performance. In several instances, companies have announced CFO departures right around the same time they’ve released bad financial news.

Coincidence? Finance executives don’t think so. In an exclusive CFO.com poll, 64 percent of respondents said a revenue restatement represents the single greatest threat to a CFO’s job security.

Indeed, some observers worry that the recent spate of accounting embrolgios, firestorms, and controversies may tarnish the CFO position itself. These obsevers point out that most finance chiefs spent the last decade or so moving from closing cop to business partner. But the continued pilloring of CFOs in the press and on Wall Street could have some CEOS rethinking the job description.

Privately, some corporate-finance watchers believe more than a few finance chiefs will be asked to spend more of their time making sure their numbers are tied down — and less time on corporate strategizing.

Hunting Finance Chief

A return to “CFO as bean counter” will make filling the finance chief position much tougher. So, too, will a backlash against CFOs who have close ties to Big Five accounting firms. Sources say some sell-side analysts are currently circulating a list of companies whose finance chiefs come from any of the top five accountancies (see “A CFO Blacklist?“).

Of course, the possible demonization of Big Five-trained CFOs raises an obvious question: If employers thumb their noses at prospects with Big Five pedigrees, where will they go to find future finance chiefs? After all, the top accounting firms have typically been seen as fertile training grounds for high-level finance managers — including CFOs.

Interestingly, executive recruiter James Drury claims he seldom looks to the accounting profession to fill a CFO position. Drury, who was once a consultant with Arthur Young and spent 23 years with executive search firm Spencer Stuart, says a pure auditing background does not produce a top CFO candidate. “Frankly, job seekers with audit-only experience don’t have the richness of experience needed for the CFO job,” he explains.

Instead, Drury targets the No. 2 finance executive at a company — typically, the vice president of finance. Usually, such a finance staffer has worked with investment banks, a company’s corporate planning and development department, along with its merger and acquisition team. Other times, Drury’s search for a CFO leads him the corporate controller — if the controller has moved beyond debits and credits.

Barry Bregman, managing partner of the CFO practice at search firm Heindrick & Struggles, says he finds many of his top CFO candidates tucked away in corporations with stellar financial management training programs, like General Electric, Pepsi, the Big Three automakers, and the pharmaceutical industry. The key to their training: Recruits — usually undergraduates — are rotated between corporate finance and operational units.

The rotation is imperative, asserts Bregman, who says that CFOs are working in a more transparent reporting environment. Hence, finance chiefs require a truly holistic view of a company.

Investment bankers tend to have that sort of big-picture understanding Bregman speaks of. They also know corporate finance and deal-making. Nevertheless, recruitment specialists seem divided as to whether Wall Street is a good place to look for a corporate finance chief.

Barry Honig, president of executive search firm Riskon Inc., insists that management and boards can benefit from a Wall Street-trained CFO. He belives Wall Street veterans are adept at financial engineering and due diligence.

But Drury says he pretty much avoids Wall Street when he’s hunting for a CFO. The reason: mostly, because investment banking is a transaction-based world, while the corporate world tends to be more about management and process. Besides, Drury says it’s too hard to lure sharp investment bankers away from the Street. Why? They make too much money.

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