10 Tasks an Outsourced CFO Can Complete for Your Business
There comes a point in a small business’s growth journey when the owner realizes there are financial and operational matters that cannot be handled sufficiently without help. Letting go of the reigns a bit is a tough task. But the difference between owning a job and building a successful company that can run without you making every decision is the goal you should always be seeking to achieve.
Hiring a financial officer is a huge and costly step. Many companies need to expertise, but simply cannot afford the salary of a full time CFO. And, maybe a full-time hire would be too much right now anyway. But a CFO is a key position. That person can provide you with sound financial advice, accurate reporting, and important oversight on how to deal with the important financial decisions a business faces nearly every day. From payrolls to operational expenses; banking to depreciation, the CFO role can be pivotal to your growth plan.
But if that hire is just not in the cards right now, perhaps it is time to consider a fractional CFO position. If you hire an outsourced CFO, your company gets the same level of expertise, plus the resources that an accounting firm offers to provide ancillary services, such as bookkeeping, accounting, and tax preparation and planning services. It also helps you manage the costs that a new hire would require, without need to consider the 30%-plus in benefits and taxes needed for a full-time equivalent hiring. And, of course, you don’t have to worry about paying for sick days and vacation time.
So what can an outsourced CFO do for your business?
Depending entirely on your business and its specific needs, an outsourced CFO can be expected to help you with:
- Budget creation
- Senior-level financial decision making
- Developing cash flow management strategies
- Recommending areas for expense reduction
- Creating a tax strategy
- Strategy development for increasing company profits
- Managing accounting procedures, internal controls, and IT systems
- Reviewing your insurance policies and legal agreements
- Growth planning and development
- Oversight regarding investments, mergers and acquisition opportunities.
The above list encompasses a broad range of areas, and time spent on any individual matter may be a balance that is determined entirely by you, your business requirements right now, and the advice of your outsourced professional on priorities that make the most impact.
Another reason to hire an outsourced CFO is special projects. Sometimes, there are organizational issues, or financial management problems that simply require an extra set of eyes to provide the expertise, oversight, and concrete structure to your matters of concern. Perhaps you require more financial controls, or a serious overhaul of your books and records. Maybe you are considering a bank loan, line of credit or other financial obligation and want to be sure all the ducks are in a row before opening the books to a potential new creditor. This is when a professional outsource can be ideal. Engaging an outsourced CFO for an important project not only ensures the job is completed on a budget; it also gives you an opportunity to test a new relationship before entering into a more long-term service provider arrangement.
Ultimately, your outsourced CFO should be an experienced financial expert with the wisdom to organize and set up essential reporting systems in order to keep your businesses finances functioning properly.
Of course, the best reason to look for an outsourced CFO is cost; a successful outsourced situation can provide you with superior financial expertise for a fraction of what you would have to pay a high-level employee as an internal hire.
If you are interested in discussing outsourced CFO solutions, feel free to contact your ZMC & Associates professional for details and answers to your particular questions.