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(originally published by Booz & Company)


CFO Bonuses Soar When Earnings Numbers Are Met

The data showed that more than half of the firms that met or barely beat their targets either persuaded analysts to lower their forecasts or employed effective investment strategies to avoid missing their earnings goals. “In other words,” the authors write, “CFOs are being rewarded for their job-specific performance.”

Bottom Line:
To earn large compensation packages, it pays for CFOs to aim low — meeting or just beating earnings expectations by effectively investing profits and revising analysts’ expectations to a realistic level.

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