Outsourced CFO Services: Your Key to Efficient Financial Management and Planning
A CFO manages all a company’s financial operations- past, present and future. In most cases, they are considered second-in-command to the CEO.
CFOs bridge the gap between technical financial information and business strategy. Most CFOs have a deep understanding of accounting and finance, yet also be an adept manager. They typically have an extensive background in these functional areas, as well as qualifications such as a CPA license or CFA designation.
You can split the CFO’s primary duties into three areas:
Controllership is the backward-facing part of the CFO’s job and focuses on accounting and financial reporting. The CFO is responsible for accurately reporting information about the company’s financial performance and position to all stakeholders that may include:
- Senior management
- Board of directors
- The public
Accuracy and timeliness are imperative as these parties make critical decisions based on the information the CFO presents through the work of their controller.
CFO vs. Controller – Controllers head a company’s accounting departments and report to the CFO. With that said, a controller’s responsibilities tend to be more technical and focused on the past— whereas a CFO has a more managerial role, looking at the bigger picture.
In the present, the CFO must manage the business’s funds and liquidity. Their most important job is determining the optimal capital structure — the mix of debt, equity, and internal financing — for the company. For treasury, cash is king.
CFOs are also tasked with investing company cash into projects or securities based on risk and liquidity levels.
Future: Finance – Financial Planning and Analysis
Finally, the CFO looks towards the future by using past data to forecast potential company performance and advise on how the company can improve financially. This is typical the function of a Financial Planning and Analysis (FP&A) department.
A CFO with several product lines may be responsible for identifying the most efficient and/or profitable product lines based on past financial data. To do so, sophisticated financial models must be produced to provide data for decision making.
What Does an Outsourced CFO Do?
Being the right hand to the CEOs, CFOs are one of the most vital members of any organization. Thus, finding a qualified candidate — whether internal or external — can be quite a challenge.
Additionally, in-house CFOs command high compensation as do other members of senior management. Many growing businesses need someone to fill the CFO role, yet don’t have time to find one or can’t afford it.
Outsourced CFOs provide a solution to this problem. Outsourced CFOs provide you with vital CFO-level support based on your needs — helping you get the most value for your dollar. Services an outsourced CFO can perform include the following:
- Budgeting and Forecasting
- Capital Structure Determination
- Financial Modeling
- Growth Strategy
- Interim Services
- Mergers & Acquisitions Facilitation
Why Does Your Business Need an Outsourced CFO?
With less of a need for sophisticated financial statements or strategic management, smaller companies are usually are able compile their own financials. But further growth necessitates the need for business owners to focus on their growth of the business and leave the financials to experienced professionals.
Outsourced CFO services fill in the gap between business’ needs and resources available. Whether a firm needs growth advisory services, assistance with optimizing their capital structure, or even an interim CFO to stand in, an outsourced CFO is a perfect resource.
Do you need an outsourced CFO to take your financial management off of your hand? CFO Hub’s is here to help. With us, you get access to experts on-demand that can help you translate your financial information into actionable intelligence. You’ll always be in control of your finances without having to manage them yourself. Contact us today for your free, no-obligation consultation.