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If CFO return cash in form of dividend but then again ask for funds, then it may temporarily reduce the share price of the firm. Also growing companies normally have no or very little dividend payments. Many people buy such stocks because of their growth potential. But when such companies announce high amount of dividend payments, investors see that as an acceptance by the management that the company doesn't have big growth projects anymore. This reduces the high price to earning premium normally accorded to growing companies.
CFOs also have to look at the industry practices. Most of the investors look at companies in the similar sector for comparison. As an example, if it is a mature company like one in utility sector, then investors would expect it to pay high dividend. On the other hand if it is a company in fast growing sector like software, then an increase in dividend would send a signal that company's day of faster growth through acquisitions or projects is almost over. CFOs can use a sudden change in dividend policy to hint the same. When Microsoft announced a massive increase in dividend, investors took that as a signal that Microsoft is now too big to be a growing company.
CFOs in companies which have recently announced bad news can take some liberty in announcing dividend cuts. When investors are already aware of tough conditions and which have been already acknowledged by the company, then reduction in dividend doesn't result in that severe movement in share price. Infact some times share price goes up as investors believe that management is concerned about the well being and continuity of the business rather than appeasing investors in short term. So when CFO has already shared the information about tough financial conditions, it makes sense to take a cut in dividend rather than first giving a dividend and then immediately asking investors for money.
Dividend decision is not based on just one year earnings and CFOs should look at various factors before deciding dividend payout.
Appendix I: Hays plc five year dividend history
 
2000
2001
2002
2003
2004

Dividend, p
3.54
4.07
4.68
5.38
3.00

% change
 
15.0%
15.0%
15.0%
-44.2%

Basic earning per share, p
7.7
5.5
4.82
-28.39
3.87

% change
 
-28.6%
-12.4%
-689.0%
-


Source: Hays Annual Report 2004, Annual Report 2003 and Annual Report 2001; http://www.haysplc.com/investors/annual_reports.asp

Appendix II: BT plc five year dividend history
 
2000
2001
2002
2003
2004

Dividend, p
19.6
7.1
2.0
6.5
8.5

% change
 
-63.9%
-71.8%
225.0%
30.8%

Earning per share before goodwill and amortisation, p
29.8
17.5
6.1
14.2
16.