All successful businesses at some point (the sooner the better), need to hire a bookkeeper or advisor, to help oversee and manage finances. A Chief Financial Officer (CFO) is responsible for managing the companies finances, forecasting economic and market trends, capital acquisition and interpretation of financial statements. Virtual CFO’s are most commonly used for small to mid-sized businesses and startup companies.
When to Consider Hiring a CFO?
Is your business increasing or decreasing at a rapid pace? If so, hiring a CFO to come in, and analyze the current financial standing will provide a new perspective, from an expert in the industry. An experienced CFO will work as part of the team providing insights on where you can cut costs, how to plan for financial success and explanation of importance finance reports.
If important business decisions are being held up because information is not being reported in a timely manner, it is time to consider hiring a professional. A professional will help deliver accurate data, timely reports and expert financial insights.
Questions to Ask Before Hiring a CFO:
- Are you experiencing shortages in cash flow?
- Is your business revenue increasing each year?
- Is your business growth lacking because of financial responsibilities needing to be fulfilled?
- Are there efficient budgets set in place? If so who is tracking the progress?
If you answered yes to any of the above questions, it would be in your best interest to consider hiring a CFO.
Benefits of Hiring a CFO:
Cost Savings:
Hiring a virtual CFO costs a fraction of the amount it would be to hire an in-house employee. It ends up saving you from paying for extra office space, computer equipment, employment taxes and health coverage.
Flexibilities:
Flexibility is a major benefit, allowing the choice of how many hours of service you would prefer, and always being able to adjust when necessary. There are times when business is at its peak and needs more financial assistance, increasing the hours of a virtual CFO is just a phone call or email away.
Cloud Based Services:
By implementing cloud based bookkeeping or accounting software, you have complete access to reports from any device. This service allows important documents such as inventory, accounts receivable, and general ledgers to be retrieved in just a few clicks.
Increased Focus on Business:
The primary focus of the business is to generate profit and provide a great product or service. Spending to much time focusing on the business’s bookkeeping or financial tasks can cause other areas of the business to be neglected. Bringing the focus back on building your business will facilitate growth, and growth is best handled with proper preparation, a CFO can do just that.
Expert Opinion:
A seasoned CFO specializes in forecasting financial trends based on the market, economy and other related circumstances. Senior level financial guidance and analysis can help you learn the proper steps to grow your business in order to increase bottom line profits. When you hire an expert who is not as emotionally wrapped up into the business, they can look strictly at the numbers and provide a fresh perspective based on factual data and the current market.
Responsibilities of a CFO
- Analyzing finances and interpreting the results.
- Managing and providing financial direction for employers of bookkeeper if there is one on staff.
- Manage financial planning, records and reporting/calculating and risks.
- Provide guidance on how to control expenditure and acquire capital for a low cost.
