What is an outsourced CFO? Other names like fractional CFO can be used, these are services that provide an organization part-time presence of an acting CFO. This offers the company the insight a CFO would bring, without the in house cost, salary, benefits, and bonuses of a full time CFO.
A fractional CFO may be brought into an organization to overcome specific financial challenges such as:
Why companies decide to go with outsourcing CFO services:
- Cost effectiveness and flexibility to have the right financial expertise when needed without the burden of maintaining a full time CFO.
- Access to specialized expertise with a team of finance professionals with specific niches and expertise to get the job done.
Startups and small businesses that operate with limited resources and budgets may be the best option to move forward with less financial strain. Rapidly growing companies may have financial activity that may be more complex, with the right CFO, they can provide strategic financial, guidance, and scaling financial process. An outsourced CFO can evaluate the financial impact of growth strategies, manage the cash flow, and implement financial reporting systems to support business scaling. Turnaround situations requiring financial restructuring often require specialized expertise. CFO's can identify financial inefficiencies, create a restructuring plan, and implement cost saving measures to turn the company around. Mergers and acquisitions can be complex and overwhelming, which may need detailed due diligence. CFO's can evaluate the financial health of the target company, assess potential risks, and create a financial integration plan to ensure a successful merger or acquisition.