Our team at Keeping Company work with a diverse set of clients in both industry and size.
One of the dividing differences between overall performance we have noticed, is the level of sophistication in their financial insights and planning. This highly correlates with the presence of CFO services or lack thereof.
Without comprehensive financial insights and governance it can be extraordinarily difficult to improve business performance, scale, edge out competitors or identify and maximise the right opportunities.
If your business is growing rapidly, has ambitious goals or is struggling to reach its full potential, it may be time for more comprehensive financial oversight. This is when engaging the services of an outsourced CFO can help. But how do you know if your business is ready to take on an outsourced CFO?
What does a CFO actually do?
A Chief Financial Officer (CFO) is a financial strategic advisor, responsible for high level financial governance. They advise on significant business decisions such as:
- Which products lines to expand or phase out
- When to reduce headcount
- When and how to tighten spending
- When and how to invest
- When and how to source capital
- When to merge with or acquire another company
- When and how to restructure
- When and how to pivot
Your CFO will engage with various functions across the business to ensure that your finances are being managed responsibly and effectively and you’re best placed to achieve your strategic goals.
A CFO and their team will:
- Act as a sounding board for the CEO
- Report on financial performance
- Prepare detailed budgets, forecasts and cash flow reports
- Advise on tax planning, asset protection and succession planning
- Help reduce overheads and deliver efficiencies
- Keep the business funded through collecting revenue and sourcing capital
- Engage with lenders, investors, auditors, key partners and the Board
- Set policy around payroll and financial management and ensure compliance
Can I afford a CFO?
According to payscale.com the average salary package for a CFO in Australia is around $180,000. For many small and medium sized businesses this can be out of reach.
As a result, financial management in SMEs is often restricted to balancing the books or basic reporting, rather than providing strategic oversight. That means SMEs aren’t armed with the right information to make fundamental business decisions.
When you consider it this way, the question is - can you afford not to invest in strategic financial oversight? The opportunity cost of missing out on an opportunity to raise capital, improve profitability or optimise costs can exceed the cost of investing in more strategic financial governance.
An option many CFOs are now adopting is investing in an outsourced CFO. This way they get the best of both worlds - access to high level financial advice at a fraction of the cost of recruiting a full-time CFO. Outsourced CFO services means you only pay for what you need, giving your business the budget flexibility without sacrificing on expertise. You also get access to multiple minds through a team of experienced and strategic advisors.
Is my business ready for an outsourced CFO?
In our experience, businesses usually take the step towards more sophisticated financial governance when they have big goals, are experiencing barriers to growth or when they’re not reaching their full potential.
There are several signs your business may be ready for an outsourced CFO:
- You can’t afford to recruit a full-time CFO, or want to trial the process before committing to increasing headcount
- You’re growing quickly or have ambitious growth goals, but feel you could benefit from financial guidance on how to achieve them
- The financial reports and data you currently have access to are unsatisfactory or only tell a small part of the story about your business
- You don’t feel you’re armed with the right financial information to make significant business decisions
- You aren’t a financial expert and are concerned this could be holding the business back
- You’re experiencing issues with cash flow, costs or profitability
- You’re concerned you’re missing out on market opportunities
Is your business flying blind? Without comprehensive financial insights and governance it can be extraordinarily difficult to improve business performance, scale, edge out competitors or identify and maximise the right opportunities. Now may be the right time to consider engaging an outsourced CFO.
By Ryan Miller, CEO, Keeping Company
About Ryan Miller
Ryan is the founder and CEO of award-winning bookkeeping and accounting firm, Keeping Company. The company empowers business owners by providing bespoke bookkeeping, accounting and business advisory services which leverage the cloud.
As a business leader and entrepreneur himself, Ryan has built and grown several companies and understands the challenges that business leaders face on their growth journey. With extensive commercial experience as a CFO and director across a range of industries, Ryan is able to help clients tackle any commercial or financial challenge or opportunity.
At Keeping Company, we’re not just accountants, we’re business people too. With our counsel, your business can reach its full potential.
We have a team of experts; Cloud Accountants, Business Advisors, Finance Specialists working together and ready to help, contact us today.
For all media enquires please contact Tracy Miller, CMO, Keeping Company 0414 898 452.
The material and contents provided in this publication are informative in nature only. It is not intended to be advice and you should not act specifically on the basis of this information alone. If expert assistance is required, professional advice should be obtained.