Every CFO and finance department is moving toward AI, but it\u2019s not a direct journey. Financial professionals often have a very different user experience than what\u2019s envisioned, largely because of infrastructure issues, knowledge gaps, technology not responding as expected, or overlooked data and tech needs.<\/p>\n
Rohini Jain, CFO of Bill Holdings, is at the intersection of dealing with CFO needs for small and medium business finance departments, and her own use of AI as a CFO herself. I talked to her about her observations and tips for improving AI in the finance department. An excerpt from our conversation is later in this newsletter.<\/p>\n
Until next time.<\/p>\n
This is the published version of Forbes’ CFO newsletter, which offers the latest news for chief finance officers and other leaders focused on the budget. Sign up here<\/a> to get it delivered to your inbox every Tuesday.<\/p>\n Economic Indicators<\/p>\n The New York Stock Exchange in New York City.<\/p>\n getty<\/p>\n It\u2019s already been a bad week so far across global markets. Stocks dropped Monday amid concerns about tech infrastructure costs and kept going<\/a> early Tuesday as investors brace<\/a> for Micron\u2019s earnings on Wednesday, since the memory chip maker is seen as a barometer for AI demand. <\/p>\n SpaceX, which took off like a rocket during its IPO earlier this month, has come back down to Earth. Early Tuesday, its price dropped<\/a> below its $150 debut, though it quickly recovered. But this is the continuation of a trend for the company, which saw its stock drop<\/a> 16.4% on Monday alone. Monday\u2019s drop started as SpaceX announced it would issue bonds to refinance an existing loan, leading other tech investors to consider the money being spent\u2014a rout that spread to South Korean and Japanese markets.<\/p>\n Zooming out from markets, the Federal Reserve did as expected<\/a> and unanimously voted to hold interest rates steady at between 3.5% and 3.75%, in its first meeting chaired by Kevin Warsh last week. Nine of the board\u2019s 18 members favored at least one interest rate hike later this year\u2014but Warsh, who has said he wants the Fed\u2019s deliberations to be less public, said he did not make any projections of his own. <\/p>\n The policy statement issued after the meeting shifted toward that end. Under Warsh\u2019s predecessors, it would explain the reasoning behind the decisions made, as well as provide forward guidance about how policymakers expect rates to move. Last week\u2019s statement was much shorter and included no forward guidance. At the post-meeting press conference, Forbes senior contributor Simon Moore writes<\/a> Warsh said the statement just provides the facts. Warsh also has said he wants to omit the forward guidance because he feels markets should interpret policy based on actual economic data, not Fed projections\u2014something Forbes senior contributor Erik Sherman writes<\/a> is likely not welcome, especially in times of great economic uncertainty.<\/p>\n Taxes<\/p>\n The IRS has made progress in recent years to be a more tech-forward agency, but in its annual report to Congress, the Electronic Tax Administration Advisory Committee said there\u2019s still some way to go, writes<\/a> Forbes\u2019 Kelly Phillips Erb. The report made 18 recommendations for the agency to better use technology to work with individual and business tax filers, and they range from the long-discussed\u2014providing real-time validation of Electronic Filing Identification Numbers and Preparer Tax Identification Numbers\u2014to new ideas, like using AI to help filers improve accuracy, and for the IRS to detect fraud.<\/p>\n Key to making any reforms, the report notes, is adequate funding and staffing. In recent years, the IRS has seen big cuts in both. In the first months of Trump\u2019s second term, about a quarter of the revenue collection agency\u2019s staff was cut by the so-called Department of Government Efficiency. Its current fiscal year budget appropriation is about $1.1 billion less than FY 2025. Meanwhile, Erb notes, Trump has added new tax cuts, savings accounts and other rules governing taxation, giving a smaller workforce more nontechnical priorities. <\/p>\n CFO Strategy<\/p>\n Among CFOs, economic optimism is at a five-year low, but they\u2019re accelerating into AI and new technology, a new study<\/a> from financial professional services network Grant Thornton found. More than two-thirds of CFOs expect to spend more on IT and their digital transformation\u2014while a majority expect inflation to increase over the next 12 months, and their confidence in meeting supply chain needs and achieving cost control goals is falling. Most CFOs, the study found, are planning cost-reduction initiatives and want to use AI to shift to a \u201ccost intelligence\u201d strategy, finding areas to double down on potential savings and new strategies. <\/p>\n Grant Thornton recommends that CFOs going down this path build clear governance over value creation choices they make, and err on the side of resilience when making tough decisions.<\/p>\n \u201cThese investments require disciplined oversight,\u201d Grant Thornton National Finance Modernization Partner Mike Hennessey said in the study. \u201cCFOs need clear processes to confirm ROI and enforce accountability.\u201d <\/p>\n Off The LedgerHow CFOs Can Best Use AI To Benefit Themselves And Their Companies<\/p>\n Bill Holdings CFO Rohini Jain.<\/p>\n Bill Holdings<\/p>\n In her first year as CFO of Bill Holdings, which provides financial operations software for small and medium businesses, Rohini Jain has both worked with CFOs bringing AI to their enterprises, and used AI for work herself. I talked to her about her experience on both ends, and what she recommends for financial AI success. This conversation has been edited for length, clarity and continuity. <\/p>\n As a CFO yourself, how does your experience using AI inform what Bill should be bringing to its platform?<\/p>\n Jain: One of the things that is really important to any CFO is managing cash. Understanding the timing of different cash flow items\u2014when are they coming in, when are they going out? What are the things that I can do to optimize the in-house cash [and] interest on the cash that we have: If you\u2019re not maximizing your cash at hand, you end up with leaving money on the table. But the evolution and the journey of Bill providing services to CFOs has to evolve to doing jobs, not tasks.<\/p>\n How have you personally used AI as a CFO?<\/p>\n [I did AI]-curated learning. What I needed to learn as I came in to take the job as a CFO would\u2019ve [taken] a lot of time with subject matter experts, reading books or learning things which may not be specific to my situation. Two areas that I had a little less exposure [to] in my prior roles were IR and capital markets. Trying to understand the capital markets, the instruments available to you as a company if you\u2019re this size and the look of your balance sheet\u2014you can curate ideas and thought processes on how [to] operate. For me to know to ask the right questions, pressure test the right outcomes and decisions, it\u2019s really important to know all of those things in some level of detail.<\/p>\n I am able to take out a bunch of costs that I might have incurred from consulting services. There are things that I can research now on my own. My teams can augment it with the subject matter expertise they bring.<\/p>\n We are getting into the space of doing more with less, having lean teams, people who are hands-on rolling up their sleeves. You need fewer people to run reports, and thoughtful people\u2014and fewer people\u2014to think about those reports, and what decision to [make]. That\u2019s the evolution.<\/p>\n When you are talking to peer CFOs or CFOs of Bill clients, what do you hear the most often about AI used for finance in general?<\/p>\n My peers are generally larger companies trying to use AI tools to do the finance work and expedite it. It\u2019s been a journey. For a long time, it was like, \u2018It\u2019s not as easy and robust and reliable as it sounds.\u2019 It\u2019s making improvements [by] leaps and bounds. People are starting to see real productivity now in a lot of functions if you select those functions in the right way. There\u2019s still a lot of work within the data structures to be done to fully harness the power of AI. <\/p>\n Somebody I was talking to over the last couple of weeks was pointing out that if people are using the same tools that are connected to the same systems, when they come to meetings and have discussions, the discussions are less different. Everyone has a similar point of view because they\u2019re all having similar queries and ideas coming from those types of tools. This is something we need to protect ourselves from: We use AI as an augmentation of our thought processes and not having to do all the work.<\/p>\n What advice would you give to a CFO to really use AI to their benefit?<\/p>\n Hiring team members who are mentally agile and constantly change how they do and think about their jobs and what is possible, versus people who\u2019ve done it a certain way, are good at it and find it hard to change. That\u2019s how I am taking a lens to people who are going to be my team of the future. You hear a lot of people say, \u2018I try to first do everything with AI, and if I can\u2019t, I go somewhere else.\u2019 What I\u2019m realizing now is there are some things I can\u2019t do immediately with AI, but somebody will tell me how they can do it.If you can take out anywhere up to 70% of the amount of time you\u2019re spending on a task, it gives you more time to think about it and add your own value. That\u2019s the shift I\u2019m trying to make in terms of pulling something together versus the thinking that goes behind the end product.Comings + GoingsBiopharmaceutical company Pfizer named Cecile Guegan as its interim chief financial officer on the news that Dave Denton will leave the firm for a new opportunity, effective August 15<\/a>. Pfizer will undergo an internal and external search to identify a permanent CFO.Consumer electronics retailer Best Buy announced that its chief financial officer Matt Bilunas will step down from his role, effective July 31<\/a>. The company has engaged an external search firm to find his successor.Life and health reinsurer the Reinsurance Group of America appointed Laura Cockrill as its chief financial officer, effective June 22<\/a>. Cockrill steps into the role after more than 25 years with the firm, most recently working as the company\u2019s chief strategy officer. She succeeds Axel Andr\u00e9.Strategies + Advice<\/p>\n As AI vendors are working toward creating more enterprise level financial tools, CFOs are scrutinizing exactly the type of ROI their companies are getting from AI. Here\u2019s what to look for<\/a> when trying to determine just how much an AI tool will impact your finances.<\/p>\n An effective leader knows to delegate tasks to those who can solve it best. However, you should be doing more than passing off major issues and going to the next thing. Instead, ask the questions<\/a> and understand how the system operates, as well as how risks are handled. Make changes where they are needed, and ensure that the system can be trusted.<\/p>\n Quiz<\/p>\n Starting in 2027, which state will be taxing crypto transfers?<\/p>\n A. California<\/p>\n B. Maryland<\/p>\n C. New York<\/p>\n D. Illinois<\/p>\n