Does this sound familiar? Your business is growing. Customers are buying what you’re selling. You should be ecstatic.
But you can’t sleep at night. You feel like the business is out of control. Things should be rosy but it feels strained. The information you look at doesn’t make sense. You’re confused by the reports you have, and you’re worried the tax return is wrong. You’re in over your head talking to lenders. You’re not even sure you can make payroll, and you don’t know why.
The finances weren’t hard when you started the business, but now it’s a lot more complicated. And you’re not sure your bookkeeper is doing a good job.
Maybe it’s time to hire a CFO. Sure, your business is probably too small for a full-time, in-house CFO. But that doesn’t mean you have to go without. An outsourced virtual CFO can help you connect the dots, make sense of your current situation, and help you plan for the future.
The Role of a CFO
A CFO takes into account the business as a whole, focusing on growth and profitability rather than the individual financial transactions. Not only must they have good accounting skills, but they also need strong project management skills to lead and facilitate the movement of projects and tasks within an organization. They must have the right combination of soft and hard skills to look at the broader picture and chart a course for the company.
The CFO must be future-focused and anticipatory. They may rely on the historical data to make some informed decisions but must also be aware of changing technologies in the marketplace, the economy, the organization’s marketing and management environment, organization, culture, customer concentration, vendor financial health, and many other external elements that affect the organization.
Sometimes, an organization needs a combination of accounting professionals. CFOs often work in tandem with bookkeepers, accountants, or CPAs to ensure that they have accurate financial information. If you’re curious about the differences between bookkeepers, CPAs, and CFOs, check out our January 2021 blog.
Do I Need a CFO?
A CFO takes their financial expertise and channels it into a strategic leadership role to create financial success for your company. CFOs have a deep understanding of your business model and your banking relationships, prepare detailed financial and management reports, work with auditors, oversee tax planning, and set policies around controls and payroll.
CFO responsibilities include budgeting and forecasting, managing outside funding or acquisitions, and compliance issues. The CFO is forward-thinking as they consider economic, industry, tax, government regulation and social issues. You need a CFO when you need:
· To know why profitability is not at the desired levels
· Complex tax planning
· A financial model that represents your strategy
· Visibility into future cash flows
· To better understand your margins
· To develop new products, markets, or offerings
· Detailed financial data that is critical to making sound business decisions
· A business partner to develop and execute strategy, providing leadership and oversight
Do you think your business might benefit from the help of a CFO? Contact KBS CFO and we’ll help you figure it out.