Service agreement for a finance director

A finance director carries responsibilities that the law places on the company and its directors as a whole: accounting records, accounts, filings, tax, and the judgement about whether the company can pay its debts. The service agreement has to state those responsibilities and the finance director's own duties as a director, set the authority over the company's money and the controls that go with it, provide for reporting to the board and the auditors, deal with professional obligations and independence, and set the notice, handover and covenants that a role with complete knowledge of the company's finances justifies. I draft that agreement for the company for a fixed fee of £995, delivered in five working days.

Who this is for

Companies in England and Wales appointing a finance director, chief financial officer or head of finance to the board, and companies formalising the position of a finance lead who has been promoted.

What matters in a finance director's service agreement

The finance director's responsibilities and the statutory ones among them

The agreement should describe the role (financial management, reporting, treasury, tax, controls, finance systems and the finance team) and should identify the responsibilities that the Companies Act 2006 places on the directors collectively and that the finance director takes the lead on: adequate accounting records under section 386, the preparation of accounts that give a true and fair view, filing at Companies House, the confirmation statement, and the company's tax compliance; the duties remain every director's, and the agreement should say that the finance director leads on them and reports to the board, rather than that the board has handed them over.

Authority over the company's money, controls and sign-off

The agreement should state the finance director's authority over bank mandates, payments, borrowing within board-approved facilities, the sign-off limits, the matters requiring a second director or the board (payments above a limit, new facilities, security, guarantees, transactions with directors or shareholders), and the controls the finance director is responsible for designing and operating; a finance director with sole control of the bank is an exposure for the company and for the finance director, and the agreement should state the segregation the board requires.

Reporting, the board and the auditors

The agreement should set the reporting cycle (management accounts, cash flow forecasts, covenant compliance where there is a lender, the budget and reforecasts) and its form, the finance director's obligation to report promptly to the board any matter affecting the company's solvency, its covenants or its ability to pay its debts, and the relationship with the auditors (access, cooperation, the audit timetable); the directors' duty to consider creditors when the company is or may become insolvent under section 172 of the Companies Act 2006 and the wrongful trading provisions of the Insolvency Act 1986 depend on the finance director telling the board in time, and the agreement should say so.

Qualifications, the professional body and independence

The agreement should state the professional qualification the role requires and the obligation to maintain membership and continuing professional development, the finance director's obligations to their professional body (including the duty to report and the limits on acting where the body's rules require independence), the position where the finance director disagrees with the board on a financial statement or a filing (the right and the obligation to record the disagreement, and the whistleblowing protections under the Public Interest Disclosure Act 1998), and the outside appointments permitted; a finance director who is told to sign accounts they do not believe is the situation the clause anticipates.

Pay, bonus and the conflict in setting them

The salary, bonus and benefits should be set by the board or a remuneration committee with the finance director excluded, and the bonus targets should be designed so that the finance director is not rewarded for the figures they report without independent verification (audited results, cash rather than profit, board-approved adjustments), with the clawback and the written consent section 13 of the Employment Rights Act 1996 requires; the agreement is kept for inspection under section 228 of the Companies Act 2006 and observes the two-year limit in section 188.

Notice, handover and the covenants a finance director justifies

Notice should be long enough to recruit a successor and complete a reporting cycle, with garden leave and a pay in lieu clause and the statutory minimum under section 86 of the Employment Rights Act 1996 as the floor; the handover should be specified (the accounts to a stated point, the forecasts, the bank and HMRC relationships, the finance systems and their access, the audit), the covenants should cover confidentiality of the company's financial position, non-poaching of the finance team and non-dealing with lenders and advisers in the company's field for a short period, with a non-compete only where the finance director's knowledge of strategy justifies it, and the resignation from the board and payments for loss of office under section 217 of the Companies Act 2006 handled as for any director.

What it costs

Senior or director service agreement, £995. With properly drafted restrictive covenants and garden leave. Five working days.

Employment contract, £595. One template you can reuse for a grade of staff. Five working days.

Buying online forms the engagement on payment. The scope is what the employment contracts and handbooks page describes, you accept the Terms of Service at checkout, and I email you within four working hours to get started. If you would rather ask something first, email me.

What you get

• A bespoke contract drafted for how you employ people
• Restrictive covenants drafted at a scope a court will uphold
• Confidentiality and intellectual property provisions that put ownership where it belongs
• The statutory particulars, so the document does the job section 1 of the Employment Rights Act 1996 requires it to do
• Flexibility clauses where you genuinely need them, drafted to survive challenge
• Core policies: disciplinary, grievance, sickness absence, equal opportunities, data protection and, increasingly, AI use
• One round of amendments

What is not included

• Acting for employees
• Employment tribunal representation
• Payroll, pensions auto-enrolment and tax
• Immigration and sponsor licence work
• Day to day HR handling, disciplinaries, grievances and redundancy processes

Questions I am often asked

Is the finance director personally responsible for the accounts?

The directors are responsible collectively, and the finance director leads. The agreement says so, which keeps the board's responsibility where the law puts it and the finance director's role clear.

Our finance director disagrees with the board about a filing. What does the agreement do?

It gives the finance director the right and the obligation to record the disagreement and refers to the professional and whistleblowing protections. It does not resolve the disagreement; it makes sure it is documented.

Should the finance director's bonus be linked to profit?

If it is, the figures should be independently verified, because the finance director reports them. Many boards use audited results or cash with board-approved adjustments. The agreement provides the structure and clawback.

Related guidance and services

• Employment contracts and handbooks, £995, the service this page describes
• Shareholders agreement, £995
• Settlement agreements for employers, £795
• Service agreement for a managing director
• Employment contract for a bookkeeper

This page is general guidance for businesses in England and Wales, not advice on your own circumstances. Last reviewed: October 2026. Email geoffrey@caesar.co.uk.