Outsourcing a CFO or FD can be a very cost-effective practice for startups and early-stage companies and provides an invaluable resource for your business, allowing you to access the strategic financial skills and expertise that your company may not as have as a newly formed company or startup.
Hiring a Chief Financial Officer (CFO) or Financial Director (FD) is often not economically possible and allows you to gain expertise without adding to your permanent headcount.
As a business develops and expands, a start-up or early-stage company will need CFO or FD to help navigate growth. An outsourced CFO service can be highly effective and outsourced CFO service costs can be very appealing to start ups and small businesses.
An outsourced CFO or FD can provide your company with:
- Experience – being able to tap into financial expertise
- Forward planning – working with your business to provide monthly forecasts, yearly budgets, source funding and capital and give you a clear view of your company’s likely landscape down the line
- Oversight – help you to see, understand and enhance the numbers
- Insight – review and challenge financial strategy and information
Chief Financial Officer v Financial Director
The roles of CFO and FD are interchangeable. Both roles play a vital part in managing, controlling, and analysing the financial climate of a business.
In larger companies, where there are teams of people working on financial matters, the CFO is the most senior person within the finance operations. The FD will be the most senior accountant in charge of day-to-day operations.
The key responsibilities of both roles are outlined below.
The Chief Financial Officer will oversee the company’s financial operations, managing the financial intricacies and working together with senior company executives and the senior management team to develop and manage financial and tax strategies and set up financial IT systems. Their primary goal is to drive the company’s financial planning to support its growth and secure new business and are responsible for strategic direction.
The Financial Director has similar responsibilities, creating a solid foundation upon which a company can grow, providing financial advice and support to senior executives and directing the company’s financial operations. They are generally responsible for focusing on all financial aspects of the company and overseeing systems and controls on a day-to-day basis.
In start-ups and small to medium sized businesses, the distinction can be academic with the job descriptions being comparable. The key point is to focus on the tasks to be performed and to ensure the business has the right financial leaders to build financial models, source investment, raise capital and explore funding options.
In organisations where there is a CFO the FD will have similar responsibilities, but the key difference is that the CFO will be part of the senior executive team and sit on the board, whereas the FD are not part of the senior team but have a key role in overseeing and directing the company’s financial operations and report to the CFO.
The level of financial leadership required will depend on business requirements. Each have different skill sets and the stage of a business will establish when such skill sets are needed. A startup or early-stage company will need advice and support when raising funds and capital and to explore tax relief schemes such as EIS/SEIS.
Hiring is not always the right option, at AccountsPro we can provide your business with FD and CFO Support which are designed to help your business grow and succeed. We will provide an experienced and commercially astute finance professional without adding to employee count and resource costs and will work with your startup or early-stage company to ensure you have the right level of support that will add vast support to your team.
We understand how businesses work and how to make them grow. By combining financial support and business acumen, we will build the right financial foundations for your company and give you the support and advice when you need it – identifying opportunities and providing a cost-effective resource to support your company’s growth.
AccountsPro can find the best talent for your startup, helping you hire interim or permanent FD or CFO support as we become an extension to your business.
For a trusted finance partner that will support and guide your business contact us for a free consultation.