Finding the right chief financial officer (CFO) can be difficult. Many growing companies cannot afford a full-time CFO or have trouble finding the right candidate. Outsourced CFO services provide an alternative solution that comes with many benefits.
Challenges of Hiring a Full-Time CFO
Cost
- Hiring a full-time CFO is expensive. The average CFO salary is over $300,000.
- On top of salary, you have to consider benefits, payroll taxes, insurance and more.
- Many smaller companies cannot afford such high salaries early on.
Long Recruitment Process
- It can take 6-12 months to find and hire a qualified CFO. The process involves:
- Posting the job
- Reviewing many candidates
- Conducting interviews
- Negotiating an offer
- This long hiring process takes you away from focusing on your core business.
Learning Curve
- A new CFO takes time to understand your business. They won’t provide much value in their first few months.
- An outsourced CFO team already has broad experience so they can deliver results faster.
Underutilization
- In the early days, you might not need a full-time CFO.
- Hiring one anyway means you pay for time you don’t use.
- With outsourced services, you only pay for work delivered.
Benefits of Outsourced CFO Services
Cost Savings
- Rather than paying one CFO’s high salary, outsourced services let you pay a lower rate for only the hours you need.
- You save money and get financial support scaled for your current size.
Expert Team
- Outsourced CFO firms have whole teams with more collective experience than any one CFO.
- You gain a “fractional” CFO, controller, analysts and more for less cost.
Flexibility
- As your needs grow or shrink, you can easily scale outsourced CFO hours up or down.
- No need to hire and fire full-time finance staff.
Focus Internally
- With financial strategy and reporting handled externally, your team focuses more on products, services and growth.
What Do Outsourced CFOs Do?
An outsourced CFO can handle almost everything an in-house CFO does, including:
Financial Planning
- Guide budgeting, forecasting, modelling and planning based on your goals and growth plans.
Accounting & Reporting
- Prepare monthly/quarterly statements, general ledger, reconciliations, and financial analytics.
Board Reporting
- Create presentations and reports to keep shareholders and board members informed with transparent data.
Specialized Tasks
- Manage payroll, taxes, audits, capital raises and even IT system implementation if needed.
Conclusion
Hiring a full-time CFO is difficult for many growing companies. Outsourced CFO services provide strategic financial leadership more matched to your budget and needs. By saving money, gaining a team of experts, and staying flexible, outsourced CFO services let you focus more on business growth.
FAQs
Outsourcing provides cost efficiency, access to expert finance talent, flexibility, and advanced financial systems/processes without having to hire full-time. It allows you to focus on strategic goals while your provider handles daily financial tasks.
Typical services that can be outsourced include bookkeeping, financial reporting, budgeting, audits, cash flow management, business planning, investment analysis and more. You can customize the exact services needed so nothing falls through cracks.
Reputable CFO services providers in the UAE invest heavily in data security and privacy protocols like encryption, access controls, secure networks, and more. Review providers carefully and ensure necessary confidentiality agreements are in place.
Yes, an experienced CFO services provider can help you meet all reporting requirements for regulations like VAT, Economic Substance, Corporate Tax and other rules relevant to your company structure and industry.
Define your needs and goals first. Then research options with strong UAE experience, credentials and specializations matching your industry. Conduct due diligence on information security, client results, etc. before selecting a provider that aligns with your budget and objectives.
