Benefits Of Using Fractional Controller Services

No matter in what industry you operate, one of your organization’s goals is to thrive and increase revenue. A chief financial officer (CFO) is the person making the financial operational decisions for your organization. This person handles accounting, budget, financing, and relationships with investors.

The CFO may focus on acquisitions, mergers, minimizing risk for the organization, and improving cash flow. Small to medium-sized companies often do not have a CFO. Instead, they have a bookkeeper or accountant. However, these positions tend to create a gap, and business owners do not have the information they need to make critical financial decisions.

While a CFO may be just the answer to any business needs, it may not be cost-effective depending on the size of the business.

A fractional CFO may be able to fill in those gaps for a fraction of the cost of a CFO. A fractional CFO is usually a contract position or a person that is on retainer. You can utilize a fractional CFO for as long or as little as your business needs.

There are many reasons to consider a fractional CFO. Here are the top 5:

#1 – Ability to Make Better Decisions

A fractional CFO can ensure you have access to accurate financial information in real-time. This person can provide reports, forecasts, and projections. This can help the leaders of a company make the best business decision they can at the time because they will have timely financial data.

This can help the decision-makers avoid mistakes and risks. This can be particularly helpful when it comes to expanding, downsizing, or taking on a large project. For example, if the business has to put up a large amount of capital to start a project, it may end up sacrificing other areas of the company. If there is a need to purchase a new piece of equipment, the fractional CFO can provide financial information to help guide those decisions.

#2 – Flexible Controls

A fractional CFO can provide support to different levels based on the business need. The business is able to customize the duties of a fractional CFO to be specific to the need. The company may need heavier support in one area at a specific period of time. If, at the beginning of the fiscal year, the state in which the business operates has a large number of jobs up for bid. A fractional CFO can help guide the organization in making bids on jobs that the business can handle. In addition, the fractional CFO can apply appropriate controls throughout the process. This can enhance control of the business’ assets while protecting them from fraud.

#3 – Cost

A full-time CFO can be an expensive undertaking for a small to medium size business. They may not be able to handle the cost. A fractional CFO is a great way to reap the rewards of having a CFO guide your business without the extensive costs. The business still receives all of the knowledge and skill associated with a CFO but without the costs of a full-time employee.

#4 – Increased Perspective

A CFO can bring more to a business than just accurate numbers and reports of the financial status. A CFO brings insight and perspective that the company may not otherwise have. The CFO can take a step back because they may not be as emotionally tied to the business as the owner. A CFO can be a trusted adviser for the leaders of the industry to listen and guide as needed.

#5 – Confidence from Stakeholders

When stakeholders are aware of a business having a CFO as a resource, they have greater confidence in the decisions made by the business. In addition, they have some belief that all decisions related to outside investing are made with the backing of a knowledgeable CFO. This also helps them feel confident about the status of the money they are investing into the business.

To put it simply, a fractional CFO brings all of the benefits to a company at a fraction of the price. The amount of time the fractional CFO works are agreed upon in advance, and there are no surprises. In addition, bringing a fractional CFO onboard can help reduce the burden on the leadership of the organization.