Five Ways to Utilize Part-Time CFOs
More and more frequently, businesses are recognizing the value of retaining the services of outsourced, part-time CFOs to augment their back office accounting & finance staff. An obvious benefit of outsourcing a CFO is gaining access to top professional talent at a fraction of the cost of having a full-time, in-house financial executive. Outsourcing also eliminates the need to undergo the expensive and time-consuming process of locating, vetting, hiring and training a Chief Financial Officer. There are, however, other benefits derived from utilizing the services of a part-time CFO.
An outsourced CFO’s services are frequently open-ended arrangements, although financial executives can also be retained on part-time, project specific assignments lasting a few weeks or months. Examples include overseeing the selection, installation and implementation of new accounting software, preparing for an annual external audit review or long-range cash flow forecasting & budgeting. Outsourcing’s built-in flexibility allows the client to custom-tailor the fractional executive’s time and services to meet the changing demands of the business. When the part-time CFO completes the special project, his or her schedule can be readjusted or their services suspended until they are again needed. Similarly, when the business once again requires financial help but is unwilling or unable to hire a full-time finance professional, it is simply a matter of contacting the outsourcing agency to arrange assistance.
A part-time CFO acquired through a professional outsourcing agency such as Pro Back Office will possess the knowledge, expertise and experience to negotiate complex financial transactions on the client company’s behalf at the highest levels. Examples of negotiations where the an outsourced CFO can be invaluable to a business include establishing lines of credit, restructuring outstanding debt, coordinating public & private stock offerings and structuring and overseeing mergers or acquisitions.
Identifying Problem Areas
Outsourcing is an effective and cost-efficient means of providing a business with a level of financial insight and expertise that would otherwise be unavailable or unaffordable. Retaining a part-time CFO familiar with the client’s industry to analyze and reorganize an underperforming operation is an excellent use of an outsourced financial executive. He or she will conduct an in-depth analysis of the operation, identify problem areas overlooked or ignored by the business’s in-house management and streamline operations by pinpointing and eliminating unnecessary tasks and expenditures. Once the problem areas have been identified, the outsourced CFO will initiate corrective actions that will reduce costs, increase revenues and improve the operation’s efficiency .
Outsourcing a CFO often makes sense for a business undergoing financial difficulties, such as a shortage of operating capital or problems collecting past-due receivables. He or she will prepare a cash flow budget that accurately forecasts cash receipts from all sources and indicates when and how the money will be used. The part-time executive will also project the time and extent of anticipated cash shortages requiring an infusion of capital from loans, personal savings, sales of company assets or bringing in new investors. A properly vetted part-time CFO arranged through a reputable agency will have sufficient experience and networking connections within the capital and lending industries to initiate cost-savings procedures, restructure existing debt, arrange lines of credit or raise investor capital.
Back Office Staff Training & Evaluation
An outsourced CFO will be capable of identifying operational deficiencies and realigning duties of the in-house staff to make them collectively more efficient. His or her review will include analyzing the strengths and weaknesses of the company’s back office workers, and may reveal duplication of efforts between two or more employees that had previously gone unnoticed. The result may be a re-positioning of duties and /or a recommendation that one or more of the employees be reassigned, their hours reduced or their position eliminated altogether.
Pro Back Office has been assisting clients throughout Southern California and Arizona since 2012. Learn more about the costs savings and other benefits to be derived through using an outsourced Chief Financial Officer by contacting one of Pro Back Offices’ knowledgeable consultants in San Diego at 858-622-1681 or in Phoenix at 602-306-4000. He or she will explain in detail how outsourcing can help your business prosper and grow.