How Does A CFO Add Value To Your Business? How Much Does a Virtual CFO Cost?

CFO refers to the Chief Financial Officer, entitled to manage the company’s operation, including finances and accounting. Apart from this, a CFO is also responsible for making the company strategy for the smooth working of the organization.

Today, a CFO is not only responsible for financial management, taxation, and financial planning but also for the successful functioning of an organization. Here is an overview of the different types of CFO services available for an organization. Find out about virtual CFO services and virtual CFO costs or virtual CFO fees as well. The blog will also help you make an informed decision about whether you should hire a full-time CFO or hire virtual CFO services.

CFO Services

As finance plays a significant role in the organization, the services of the CFOs include managing finances, maintaining compliance, and business strategy. Adding value to the organization is one of the primary services of the CFO. As a leader in finance, the CFO should emphasize more expenses and margins for the business.

Some of the CFO services include:-

  • Finance Controllership
  • Financial Planning & Analysis
  • Evaluation of ERP and its implementation
  • Specialized Services
  • Financial statements & Audit Closure
  • Controls & Compliance
  • IGAAPO to Ind AS
  • IGAAP/IFRS to USGAAP
  • IFRS/USGAAP to IGAAP/Ind AS

It’s ever more significant for CFOs to be strategists, assisting in forming overall strategy and direction to help business growth for the organization. CFOs must protect the business’s vital assets by communicating thoroughly with the investors and board of directors. They must analyze carefully and allocate the finances for the organization’s smooth operations.

Part-Time In-House CFO

Part-Time In-House CFO is not the permanent solution for the organization since they work for multiple organizations simultaneously. Your company can have more access to understanding and prospects.

Choosing a Part-Time In-House CFO offers trades the capacity to explore diverse and trained professionals preferring a part-time and flexible environment per their schedule. They are trained to manage multiple projects at one time. The best part of choosing a Part-Time In-house CFO is that it does not affect your pocket; it’s more economical than a full-time CFO.

Full-Time Permanent, In-House CFO Position

In the corporate industry, everything has to go through various channels, so having Full-Time Permanent CFOs will be an added benefit for you.

As CFOs are in charge of all the major financial decisions for the organization, they have to be meticulous in making any decision for the business’s future prospects. In case of crisis, full-time, permanent CFOs play a significant role in handling the issue and creating a smooth working environment for the organization.

Outsourced CFO Services

There are times when a company is not ready to hire full-time CFOs for various reasons; one of the main reasons is the funds. In such scenarios, a company can go for CFO for hire services or outsourced CFO services. The CFO for hire rates varies from one region and country to another.

Outsourced CFOs are trained and focused on execution and planning. Services including financial strategy, long and short-term forecasting, budgeting, and facilitating and interpreting financial reporting are some of the services managed by the outsourced CFOs.

Virtual CFO Services

With the increased demand for a virtual system, everyone prefers to manage work virtually. Virtual CFO services play a vital role in implying business operations for small businesses and start-up ecosystems. From resolving issues by setting up an accounting system to managing cash flow or debtor and creditor management, virtual CFOs fulfill all the organization’s significant responsibilities.

Some virtual CFOs’ services include financial advisory, break-even analysis, feasibility analysis, financial assessments for projects, and tax and compliance advisory, among others.

Interim CFO Services

An interim CFO offers you services for a short time or on a contract basis. He or she is a short-term member who will fulfill all the requirements of the CFOs unless your organization has a permanent CFO. The performances and fundamental matrices of interim CFOs may vary from your expectation.

The evaluation of Interim CFOs remains the same as that of Full-Time CFO; the only difference is they are for a short period for your organization.

Is Hiring a Virtual CFO a Costly Affair?

Well, a virtual CFO offers guidance and support to your organization at multiple steps, from planning to implementation and execution of the financial business operations.

Talking about virtual CFO fees or virtual CFO costs, it may vary from $3000 to $11000 per month. However, on average, the price goes from $4000 to $6000 per month. On the other hand, the costs of hiring a full-time CFO can range between $300,100 and $501,100 annually. Unless you have a large business for which hiring a CFO is mandatory, you need to consider it well before hiring a full-time CFO.

Before hiring virtual CFO services, always cross-check your requirement and make a detailed note for the same. After shortlisting your requirement, you can always look for the services. Moreover, hiring a virtual CFO is not as challenging as a full-time CFOs; the only way to ensure the process smoothly make sure to check and verify the following:-

  • Certifications & Qualification
  • Years of Experience
  • Expertise in your Industry
  • Safeguards to protect your data
  • Efficient and transparent communication

Five Key Benefits of Having Virtual CFO Services

While carrying out the entrepreneurial journey may be full of challenges and a roller coaster, hiring a virtual CFO may be the best solution for all your concerns regarding financial responsibility.

Well, some of the individual benefits of having virtual CFO services include the following:-

Accountability:

Being a new start-up in the industry may be challenging; however, you can set the goals and strategy for the CFOs to help you overcome this situation. They can assist you in achieving milestones and make your organization back on track.

Risk Management:

Being in the industry brings new challenges and risks daily. However, professional VCFOs add value to your organization by analyzing and making quick decisions beneficial for the organization. Whether getting a piece of new equipment or investment or managing the cash flow, your VCFOs are always the best solutions.

Navigation for the journey:

VCFOs are experienced professionals who can help you set up the structures and manage your new business’s growth.

Increased Profitability:

As profit is always the primary goal for any business, excellent VCFOs can help you overcome challenges affecting profitability and help with optimizing the cash flow and managing the stocks for your organization.

Increased Productivity:

To increase the organization’s profit margin, productivity has to be raised by setting up finances and implementing the execution process for the same.

How Virtual CFO Services Adds Value To Your Business

Though it’s your sole decision to hire VCFOs, if you have specific challenges mentioned below, then you certainly need to hire VCFOs for your organization:-

  • If your company is struggling to manage the finances
  • If you plan to take over a firm or merge with another company
  • Your organization is going through expansion of the team and product services
  • If you are planning capital-intensive moves

VCFOs usually are CPAs with broad knowledge about the finances of various industries to ensure the business’s success.

In case of any performance issue or reliability, you can always reach certain firms to provide you with an experienced professional who has keen knowledge about the business. The best of VCFOs is that it helps reduce the overall cost of CFO services.

Conclusion

A CFO is required for the smooth operation of an organization; whether it’s VCFOs, part-time, in-house, or interim – that remains your decision. However, before hiring CFOs, check the requirements for your organization.

As hiring a CFO for the organization is always a complicated process, you can consult an expert who can guide you and connect you with the right candidates.

Alliance Recruitment Agency- UAE

With years of experience in the industry, Alliance Recruitment Agency in UAE is a C-level recruitment agency offering various services for the start-up ecosystem, pharmaceuticals, corporates, BFSI, and many more. They have several experts who can always help you shortlist the best candidate as per your requirement in a short time. Reach out to Alliance Recruitment Agency for Virtual CFO hiring support or for CFO recruitment services.