Why Consider A Virtual CFO For A Firm?

Many companies claim to provide Fractional CFO or Virtual CFO (VCFO) services, but they usually mean back-office accounting services such as bill payment, cash flow management, etc. Outsourced bookkeeping is a great option where you can hand over your accounting tasks to specialists outside your organisation who provide high-level consulting (at a premium) but leave you to figure out the rest.

Financial planning is a specialised skill that necessitates a thorough understanding of multiple accounting tools and a broad understanding of financial documents such as the cash flow

statement, profit and loss account, and so on. If you’re just starting, chances are you don’t have anyone with these skills on your team, which is why a virtual CFO could be ideal. Financial forecasts are critical to your ability to secure investment and advance up the funding ladder. Here are four things that set some companies apart from many of the other services available online these days:

1. They become team members: The client-facing Virtual CFO at Summit CPA essentially becomes a member of the client’s team, supported by an internal team of accounting professionals with diverse experience. The team assists in cleaning up the books and accounting processes. They created a forecast and industry metrics to see how the company performs compared to others in the same industry.

2. Multi-dimensional services: They can provide back-office accounting services if necessary. For example, if the COO is in charge of paying all bills and doing tactical work on the finance side, they can take over. If necessary, they can assist with invoicing and tax work (such as tax planning, projections, and preparation). Sometimes, a client may prefer to continue working with the same accountant they’ve known for years, which is fine. All of our services are a la carte, which means that the client can choose which ones they want (and which ones they don’t) and can make changes at any time.

3. The VCFO serves as the company’s GPS: They assist with high-level strategy. They collaborate with the company’s leadership to define its goals and vision. The company owner tells them where they want to go, and the CFO assists them in determining the best route to get there. They take the seat next to them as co-pilots so that when life happens, and they have to turn left instead of right, the virtual CFO can help them get back on track and keep things moving forward. They assist with developing profit-sharing plans, mergers and acquisitions, obtaining necessary financing, scaling, and business development, among other things

4. Pricing is based on value: Most accounting firms charge hourly rates, which can lead to unpleasant surprises for clients and strained working relationships. On the other hand, some provide bills based on the value provided—with a fixed fee—so there are no billing surprises. Some firms have no agreement (i.e. one-year commitment).

If you’re considering hiring a Virtual CFO for your company, keep these four things in mind. A true VCFO should be able to provide more value than a typical accountant or bookkeeper. They should serve as your team’s extension, assisting you with higher-level financial strategy, forecasting, and cash flow management.