10 Key Benefits of a Virtual CFO

10 Key Benefits of a Virtual CFO

15 October 2019

Running a successful business takes a lot of effort and sacrifice. When you own a small to medium enterprise (SME), it is normal to find yourself drowning in daily tasks. Although these are important tasks that are crucial to your success, doing them all by yourself might be holding you back from actively growing your business.

In situations like these, it is best to re-evaluate the areas in which you are investing your time, and whether getting help from an expert in their field will benefit you and your business.

When it comes to your company’s financial matters, it is highly beneficial to have a knowledgeable, dedicated person to oversee them. In a traditional corporate structure, these duties are performed by a Chief Financial Officer (CFO).

What is the role of a CFO?

The Chief Financial Officer is a senior executive role that handles a company’s financial matters. Their responsibilities include:

  • Tracking cash flow
  • Presenting accurate and timely reports
  • Analysing data and identifying the company’s financial strengths and weaknesses
  • Economic forecasting and implementing strategy

Fundamentally, it is the duty of the CFO to plan, protect and further improve the company’s finances based on the findings of their analysis in a professional and strategic manner. As a business grows, cash flow, expenditures and taxes increase with it. Hence, it is important that the above tasks are executed meticulously and efficiently without omitting any financial details, and this can be achieved with the help of a CFO.

Hiring a CFO means that your company’s financial matters are being taken care of. This allows you to rest assured that your company finances are in the hands of an expert, so you can focus on other aspects of your business and generating more revenue.

However, employing a full-time CFO can be expensive for a small or medium enterprise and is not at always a cost-efficient option. This is why smaller businesses can benefit from AR Advisors’ Virtual CFO service.

What is a Virtual CFO?

The virtual CFO is a new concept that allows businesses of any size to benefit from the services of a CFO without having to hire a full-time employee. If you run an SME, the functions of a virtual CFO will be especially advantageous to you.

In the next part of this article, we’ll examine 10 benefits of engaging a virtual CFO service.

Avoid the full-time overhead

An SME will benefit from the lower costs of a virtual CFO as opposed to hiring a full-time, in-house Chief Financial Officer. This is due to the flexible arrangements associated with virtual CFOs that allow them to scale their services up and down depending on client needs. As a result, their services are made available at a cost-efficient price.

Only pay for what you need

Hiring a virtual CFO gives you the option of customising the services offered to suit your business’ unique needs. Employing a full-time CFO may be expensive and even a bit redundant when your business doesn’t require all the services of a full-time CFO. With a virtual CFO, you are able to outsource specific tasks that your business requires and pay only for what you need.

More accuracy in financial reports

While many reports can be prepared internally, getting help from a virtual CFO eliminates the risk of errors in financial reports that will give you inexact information on your finances.

Strategic financial planning

A virtual CFO, with his or her knowledge and expertise, can use their analytical skills to inform your business planning. Based on their findings, they can help you to implement a strategy and provide sound advice that will ensure your company is prepared for the future.

Better financial decisions

The financial standing of your company may not be where you want it to be. With the help and advice of a virtual CFO, you can make better financial decisions that improve your situation.

Reduce debts

A virtual CFO can help you strategically reduce your debts. This, in turn, provides greater financial security for you and your family.

A sounding board for your business

Sometimes when you are caught up in the day-to-day of running your business it can be hard to step back and look at things objectively. A virtual CFO can act as an important sounding board for all significant business decisions that may impact your financial situation.

Increased cash flow

Ultimately, the goal of any business is an increase in cash flow. This is the primary function that businesses engage with virtual CFOs for. By making use of a virtual CFO service, you will gain awareness of the areas of your business that needs improvement and be able to implement the recommended solutions.

Working together

The business owner and CFO will work in partnership to achieve goals and outcomes that are agreed upon. This collaborative approach will help to ensure desired outcomes are met by fostering communication to guide through various financial business decisions.

Education and Upskilling

Over time, the CFO’s goal is to educate and upskill the business owner on financial based outcomes. The business owner receives firsthand experience of the functions and strategic advice used when achieving financial related goals.

Engaging a virtual CFO will give you benefits that are pivotal in achieving your financial goals. At AR Advisors, we are able to offer your business the benefits of a professional and reliable virtual CFO service as part of our cost-effective business bundles. To find out more, see our approach to a virtual CFO below and get in touch with us today to understand how we can fit your business needs. 

AR Advisors Virtual CFO approach

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