The Top Operational Challenges Facing Private Equity CFOs Today

Private equity CFOs today are working in a dynamic environment driven by rapid regulatory changes, increasing investor expectations, and budget constraints. As firms scale, the CFO role has evolved far beyond traditional financial accounting. Today’s CFO must balance strategic decision-making with increasingly complex operational demands while managing lean teams. The following themes are the most significant challenges facing private equity CFOs today.
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Combating Increasing Regulatory and Compliance Pressures
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Regulations across the globe continue to mount for private fund managers. The compliance function has emerged as a major operational focal point as new regulations are introduced, evolving disclosure requirements are shared, and the frequency of examinations has risen.
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CFOs are at the center of this change, tasked with creating documentation around fees, expenses, and valuations while supporting broader reporting mandates such as enhanced Form PF requirements and ad hoc investor reports. Additionally, they are also responsible for strengthening internal policies and controls so firms are prepared for regulators who expect real-time readiness rather than annual check-ins.
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Solving the Data Management Challenge
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Private equity firms depend on data more than ever, yet many continue to struggle with fragmented and inconsistent information. Deal teams, finance teams, and portfolio monitoring groups often work in separate systems, making it difficult to establish a single source of truth. As firms grow their portfolios and expand into new strategies, the data environment becomes even more complex.
 
Additionally, investor reporting has become significantly more detailed as limited partners request greater transparency into fund performance, fees, expenses, and portfolio-level metrics. Quarterly cycles sneak up on CFOs and their teams, and intra-quarter, ad-hoc requests have become more common. Without a unified data strategy, it becomes increasingly difficult to meet the expectations of internal and external stakeholders.
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Developing Operational Inefficiencies Within the Back Office
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Despite new technology, many private equity back firms still rely heavily on manual processes and spreadsheets. These manual workflows introduce operational risk and take up enormous amounts of time during already shorter reporting cycles. Tasks such as capital call and distribution processing, fund accounting, management fee calculations, reconciliations, and audit preparation become cumbersome as fund structures grow more complex. CFOs are finding that true operational scalability requires rethinking the entire workflow with an emphasis on automation, standardization, and outsourcing.
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Recognizing Technology Adoption as Both a Solution and a Challenge
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Technology is essential to addressing nearly every operational challenge CFOs face, yet implementing the right systems remains a challenge for several reasons. Many firms still rely on legacy platforms that do not communicate effectively with one another, creating data silos and manual workarounds. Tools exist, but they require a significant time investment for integration and training. Before implementing new technology across the organization, CFOs must assess the short-term disruption against long-term benefits and ensure their teams have the training needed to fully leverage new systems.
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Seeing Outsourcing as a Strategic Lever
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Outsourcing to experienced providers has become a lifeline for private equity CFOs. From fund administration to compliance and ESG reporting, outsourcing allows CFOs to tap into the expertise and systems of proven providers without increasing their budgets, all while meeting tighter deliverables. More investors mean more customized reporting requests. More strategies mean more specialized accounting requirements. More jurisdictions mean navigating unfamiliar regulatory regimes. Co-sourcing as well as traditional outsourcing models have come to the forefront as CFOs look to maintain control of their data while expanding the reach of their internal teams.
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The Path Forward
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The role of today's private equity CFO has evolved beyond traditional financial accounting. Today, they sit at the intersection of strategy, regulation, technology, and operations. The function has never been more critical to a firm’s long-term success, but it has also never been more demanding.
CFOs have learned to adapt, leveraging experts to augment their teams and implement systems to streamline internal processes. At Summit, we have a long history of supporting CFOs in building the foundation that facilitates the operational strength, technology expertise, and scalable infrastructure needed to compete in a rapidly evolving industry.
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If you would like to find out more about how we can help, please feel free to contact us.