VCFO vs. CFO: Which Does Your Company Need?

Australian small and medium-sized enterprises have a huge advantage - they are better positioned to get high quality accounting and finance advice than SME’s in any other country. This is because innovation has not only hit the accounting and finance world, but furthermore Australia is considered a world-leader in its rate of adoption. Forward-thinking professionals are taking advantage of these tools and delivering financial leadership to small and medium businesses. If you haven’t heard of us, you will soon. The industry calls us “connected advisors”, or VCFOs. New technology and communication methods, such as speaking to your accountant via WhatsApp or Skype, mean that as a business-owner, you can get better service, better insights, and more bang for your buck. A Virtual CFO looks at the roles and responsibilities of actual Chief Financial Officers and apply new technologies. VCFO’s deliver genuine financial leadership to businesses that cantafford a CFO, but need one full-time. So what are the major differences between a CFO and a VCFO? In this article, we will break down the roles of each position and show you just how valuable a VCFO can be for small and medium-sized businesses.  

The Roles of CFOs vs. VCFOs

  A traditional CFO has plenty of responsibilities. They are the head of the accounting chain in a company and answer to shareholders, board members and employees of the company. It is up to the CFO to plan the financial future of the company, which means that they have a whole team working to provide data about the company's current financial situation. Using this information, the CFO creates meaningful reports to support the strategic decision makers of the business, often making these key decisions themselves. A VCFO offers all the expertise and knowledge of a CFO and delivers it when the business needs it. They provide small and medium-sized businesses with expert level advice, financial planning, strategising and reporting - all without the expense of hiring an actual CFO. One executive from a VCFO firm may manage several accounts, which means these businesses split the cost of the services the VCFO provides. You only pay for the functions that you need.  

What About the Human Aspect?

  It is impossible to deny the human aspect of a CFO versus a VCFO. Great Virtual CFOs know how to deliver the outcomes and experience of someone in the office every day, pouring over accounts and figuring out a plan for the next few months of business. Some business owners feel at ease knowing that someone is “in the seat, at their desk”. But technology means this doesn’t have to be the case. Many small and medium-sized businesses do not need a CFO every day of the week. What they really need is great advice, financial planning and strategising from a financial expert who will help them grow and de-risk their businesses. Most of these businesses might use only a few days worth of a VCFOs time per month. With cloud technology, you are never very far from your VCFO, and it is easy to share all your financial information through a safe and secure connection. The cloud not only helps you share information with your VCFO but a great CFO can then share this information to your managers and other stakeholders.  

VCFO’s are Cost Efficient

  Not only do CFOs usually request a high salary, but they also have other human expenses that must be accounted for. Full time CFOs need sick, personal and vacation leave, and, as with other employees incur additional “hidden” costs. A VCFO can offer you the great benefits of the CFO, at a fixed price for fixed outcomes. A great VCFO can bring small and medium-sized businesses all the benefits of a CFO without having to pay their salary. They can get the help they need to sort out costs and revenues and plan smarter for a better future.