What Is a Virtual CFO and What Can They Do For Your Business?

Virtual CFO services have grown in demand over the last few years, especially with small businesses. But what is a virtual CFO? How do you get one? And how could it benefit your business? Read on to find out more.

A CFO, an elusive role that normally stands amongst the top of a business hierarchy, plays a critical role in the company’s growth as they are chiefly the one responsible for its finances. A CFO is traditionally an executive role within a company but business owners, especially those of start-ups and SMEs, are instead turning to outsourcing these services. 

Virtual CFOs (also known as fractional CFO services) have become more popular within the last few years, with their main appeal being able to receive expert financial advice remotely and at the fraction of the price of in-house services. Previously, this insight wasn’t available to small business owners but this role becoming remote has now made it more attractive to individuals with the required expertise. Now, accountants can extract insight from real-time financial intelligence to provide quality advice. In this article, we will break down what is a virtual CFO and how they allow a business (no matter its size) to flourish. 

virtual cfo is smiling to accountant

What is a CFO?

A CFO, short for Chief Financial Officer, is responsible for managing the financial accounts and actions of a business. They control every aspect including cash flow, financial planning and taxation. In addition, they are in charge of pinpointing additional opportunities for financial growth by evaluating the business’s strengths and weaknesses. 

Their task is to support the CEO of the company and ensure financial stability through the right insight as well as warning of any potential financial threats. As they are part of the C-Suite, they will constantly work closely with senior management and is usually the right-hand person to the CEO. A CFO approaches everything from a strategic perspective and is always considering what can be utilised for financial growth. 

Virtual CFOs for small businesses

Within a business’s hierarchy, the CFO is an upper-level executive and a critical role with a lot of responsibility. For many small enterprises and start-ups, the owner is simultaneously the CEO, CFO and every other role in the C-Suite. Unfortunately, financial management can be an overwhelming and time-consuming procedure — especially for someone who may not have any previous accounting experience before launching a business. During this time, hiring a virtual CFO can be a big benefit for a small business. With this service, you can have an experienced and knowledgeable financial advisor for the fraction of the cost of an in-house CFO. 

Virtual CFO services, also known as outsourced or part-time CFO services, are professional financial management services that are delivered remotely. They are exceptionally helpful for small business owners to better prepare them for financial stability and are a fraction of the price for traditional CFOs. Even a large firm can benefit from a virtual CFO taking the edge off of the usually overwhelming financial management process. Once a company hits the million-pound mark for revenue, they are no longer considered a small business.

business owner having business advisory meeting with financial

At this stage, it is vital to have a separate individual dedicated to managing the company’s finances. It is also important when firms scale and slowly transition to more complex operations. This increases the complexities within finance and eventually, the CEO’s limited experience becomes too big of an obstacle to ignore. You need someone who has advanced knowledge in accounting, financial analysis or investment banking to ensure you’re getting accurate and reliable insight. 

At Wilkinsons Accounting Solutions, our team of professional accountants with unmatched expertise in business accounting and financial analysis provide  business advisory services that are trusted by an established client base in the UK. Whether you’re building for organic growth, scaling your business, or preparing for a merger, our accountancy firm can help. We have a team of skilled professionals who can support growing businesses with the right service at the right time for their business. Our services include strategy planning, cash flow and financial forecasting, mentoring for in-house staff, as well as pitch decks for funding opportunities. To learn more about our virtual CFO services, get in touch with us through email or by calling us at +447843559414. 

virtual chief financial officer list

What service can a virtual CFO offer?

Hiring a virtual CFO has steadily become more popular nowadays, especially for small business owners. This makes sense as it is a less expensive method with minimal overhead. There is a multitude of ways your business can benefit from a virtual CFO. 

Just an example of these services include: 

  • Accurate and updated bookkeeping of all accounts. 
  • Setup of financial systems that utilise cloud technology, this includes accounting software and payroll. 
  • Tax planning, including corporation tax and VAT. 
  • Financial reporting on cash flow, including profit and loss. 
  • Financial strategy that involves budgets, risk assessment, and long-term financial goals. 
  • Forecasting and adapting the business’s budget according to cost-saving measures. 
  • Improving external relations such as with auditors, banks and investors. 

Conclusion

Hiring a virtual CFO can improve your business in many ways. With the use of new accounting technologies and real-time insight that wasn’t available before, outsourced accounting has the ability to significantly improve business growth. While these changes may sound daunting, they can lead to a big increase in efficiency, productivity and profit. As a small business, receiving expert financial advice from a professional is what you need to stand out from the competition. It can help you, especially during a time of great change — such as while you’re in the process of a merger or acquisition. With a virtual CFO, you can guarantee you will be getting the right financial advice that you can trust. 

 

There is a growing demand for outsourced accountants, get in touch with us today to find out how you can hire one for your own business. 

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