Do you still need Outsourced Support with an in-house CFO?

For most companies, the expertise of a Chief Financial Officer (CFO) is vital to their growth and expansion efforts.  

With your CFO's guidance, you can manage your finances. You can also find ways to improve the company. This helps to maximize profits in a scalable way.  

While having the right financial leadership is essential, hiring a CFO right away isn't always that easy for starting companies. During its early stages, some companies lack the capacity to board a full-time CFO – which is why they turn to outsourced CFO services.  

Outsourced CFO services helped them bridge the gap when it comes to addressing financial challenges by hiring expert financial managers who can help with their company’s financial data and financial planning.  
 
The question now stands: if you do have an in-house CFO, does this mean you no longer need CFO support? 

Before we dig deeper, let’s first understand what outsourced CFO services means.   

What is Outsourced CFO services?

Outsourced CFO services involve hiring independent CFOs on an hourly, part-time, or contractual basis. Fractional CFOs, also referred to as part-time CFOs or virtual CFOs, are perfect for small to mid-sized enterprises that need the expertise of an executive-level accounting professional but have limited resources in hiring a full-time CFO.  

Read: What is CFO Outsourcing? Benefits and List of Services 

But in what way can outsourced CFO services contribute to your company’s success?  

While your CFO heads your financial operations and all your financial systems, having outsourced support who are experts in the finance and accounting field benefits your CFO by providing a holistic perspective when it comes to your company finances. 
 
Aside from helping you with the finance functions of the CFO such as cost benefit analysis, risk analysis and financial mapping, outsourced support can also help you in your main function as the financial controller.  

They help adopt the latest finance and accounting trends and integrate accounting technology into your everyday functions, positioning your accounting team and your finances to be able to navigate changes –thus future-proofing your company.  

 
The Importance of a CFO for Every Company 
 

A CFO is mainly in charge of the financial direction of your company’s operations. They view every process and task from a financial perspective, ensuring that it is within the best interests of your company. CFOs work hand-in-hand with the company’s Chief Executive Officer (CEO) in facilitating various growth-driven initiatives, constantly improving how the company operates and setting attainable financial goals to work towards to.  

Without a CFO and reliable finance and accounting expertise, company decisions made by the CEO and the rest of the management may not always be financially-wise – solving one problem currently but reducing the financial security of the company which can affect their longevity and financial troubles in the future.  

By having the right support to view every decision and risk from a financial perspective, a company’s financial health and longevity can be secured.  
 

In this article, we will explore the seven critical advantages your business may be missing out on without outsourced CFO services.  

How Important are Outsourced CFO Services? 

Outsourced CFO support gives you direct access to professionals who can help manage all aspects of your company’s finances. 

Here’s how they can help improve your financial position and drive you towards your company’s goals. 

Cost Management and Reduction

One benefit your company might miss without an outsourced CFO is adept cost management and reduction. A seasoned CFO employs a meticulous approach to identify inefficiencies within the financial framework. With outsourced support, financial professionals can look into the current financial framework of the company and identify if processes are not only efficient but if they need to be updated.  

By working together with an accounting support team and analyzing spending patterns and company costs, CFOs can implement robust cost-control measures. This not only streamlines expenses but also maximizes profitability—a fundamental goal for any company.  

Related: A Comprehensive Guide to Outsourcing CFO Support Services  

Reduced Operational Costs 

With an in-house CFO, a permanently employed finance team usually follows. An in-house finance team will incur the necessary salary, benefits taxes and overhead expenses to ensure they have the right resources to assist the CFO.  

However, having an outsourced CFO support provider helps you to cut down significantly on these costs as they become your CFO’s right-hand person.  

With the option to pay only for the services you need and only when you need them, this approach helps avoid the financial burden of onboarding a full-time team. It is important to note, however, that the extent of these savings and cost effectiveness depends on your choice of service providers, making it crucial to choose wisely.  

Enhanced Credibility with Stakeholders

Having the right kind of people to assist your CFO, whether in-house or outsourced, strengthens stakeholder confidence. 

 According to a study by EY, 82% of respondents said that “CFOs are increasingly seen by key stakeholders as the stewards of long-term value.”  

Consequently, financial statements prepared and presented by a CFO carry actionable insights and lend credibility. This assurance is invaluable when dealing with investors, lenders, and partners, especially in our current era where trust is paramount. A credible financial report can be the decisive factor in securing investment or negotiating favorable terms with financial institutions.  

Additionally, CFOs can count on outsourced accountants to prepare all necessary financial information and reports that the former can use in producing financial statements. CFOs already have too many responsibilities to carry so having proficient right-hand accountants can somehow alleviate some of those burdens, thereby enhancing the credibility of your companies with all stakeholders involved.  

Read: Outsourcing to the Philippines: Benefits & Tips to Consider  

Timely Compliance

One of the main responsibilities of a corporate CFO is making sure that both the company’s operations and finances are in accordance with the rules and regulations applicable to their industry.  
 
Whatever industry you may be in, not being able to comply with the rules and regulations not only attracts legal woes but can also tarnish your company's reputation – resulting in lack of public trust and profit.  

To remedy this, outsourced CFO support can easily take on the challenge of ensuring that your operations are up to date on compliance matters, giving your CFO the time to take on more value-adding work regarding your company’s growth.  

With an outsourced team who can take care of all applicable regulatory requirements, you can avoid costly fines and penalties and keep your company's reputation solid. This systematic compliance ensures operations run without disruptive legal hiccups.  

Access to Useful Networks and Resources

While your CFO undoubtedly has connections and the expertise needed to navigate the finance and accounting field, outsourced providers are always collaborating with other professionals – bringing in a wealth of not just experience but knowledge and connections as well.  

Outsourced CFO support service providers can bring a wealth of contacts and resources for the company. As their expansive network opens doors to industry contacts, potential partnerships, and specialized know-how that can be a boon for your business. This aspect alone can accelerate growth and present new strategic opportunities for your firm.  

Strategic Planning and Alignment 

Strategic planning is the hallmark of any successful company, and a good service provider must know this exactly.  

For this reason, selecting a service provider isn't just a task—it's a pivotal decision. It's essential to make sure that these professionals possess a deep understanding of strategic planning nuances to effectively support your endeavors.  

When choosing an outsourced CFO support services provider, ensure that their expertise extends to harmonizing your financial aspirations with your overarching business strategies. This critical alignment should encompass a broad spectrum of strategic initiatives, from navigating mergers and acquisitions to devising comprehensive exit and expansion strategies.     

By leveraging their insight, these experts not only provide your company with a roadmap of strong financial options but also a strategy on how to pursue it. They guide you towards making decisions that best align with your company’s long-term goals.  

Read Next: 6 Ways CFO Support Services Lessen the Stress of Finance Executives  

Business Continuity

Companies that outsource a portion of their operations and service delivery can get an added layer of protection for your risk management efforts and business continuity. 
 
Sudden changes in the economy, within the internal handling of the company and even market fluctuations, can easily affect your company’s day by day operations – as is seen by the 2020 COVID-19 Pandemic and how it affected all industries.  
 
For example, the Journal of Accountancy noted how CPAs and finance and accounting professionals saved businesses within the United States.  

In uncertain times, many clients seek not only tax and accounting help but business advice. In one such instance, a client of the D&V Philippines began their journey with us in the middle of the COVID-19 pandemic, using our accounting solutions to address their talent-related concerns during the pandemic. 

While businesses grappled with the economic upheaval brought about by the pandemic, CPAs stepped in to help by identifying clients' needs based on their existing knowledge of their businesses (Dennis, 2021). 
 
To navigate these challenges, having an outsourced partner who can handle some of your operational needs, such as financial management, helps ensure that you don’t just simply shut down operations. Outsourced partners work with you in a remote setting, allowing them to still be able to handle your business regardless of the current challenge your company is facing.  
 
By having outsourced CFO support to help your CFO, your finances will not only remain safe but will still be able to circulate as needed for your operations, investments and other financial needs.  

Preparation for the Future

Lastly, one of the standout benefits of CFO support outsourcing is their contribution to making a business future-proof. While a proficient CFO understands market trends and financial levers, translating complex data into actionable forecasts, it is through a trusted team that these insights turn into action, -- integrating it with current processes to help the company navigate the future. This partnership helps your firms anticipate market changes and pivot effectively.  

Given the unpredictable nature of business, having an expert who is well-versed with various market scenarios and can lay strong groundwork for your firm as the future is inevitable.  

For example, as the field of finance continues to integrate technology into all aspects of financial management, having an outsourced partner who can stay on top of this continuous integration can prepare your company for potential cost implications of this continuous change and how your organization can adapt to its usage.  

Additionally, having outsourced professional accountants can assist your CFO in creating a blueprint for success that addresses potential challenges before they become urgent crises as CFO support gives you access to expertise. Onboarding outsourced accountants who are experts in areas such as risk and crises analysis and scenario mapping can support your CFO in proactively solving vulnerabilities that your company may become exposed to over time.  

The Bottom Line  

Not having an outsourced CFO support provider can result in missing out on significant growth, savings, and strategic opportunities – overall hurting your company’s financial health.  

While having a CFO addresses your financial needs, being able to use your finances as an active tool for growth requires more than just one person – it requires the expert insights of professionals who have not only been in the field of finance for decades but have already navigated several changes within the industry.  

Hiring outsourced CFO support isn’t just about addressing operational gaps due to your CFO’s overwhelming responsibilities; it's about accepting and leveraging an asset that will transform your financial strategy into a sustainable engine of growth and resilience for your firm whether or not you have the expertise of an in house CFO within your internal controls.  

The Right Expertise for your Company Needs  

 Looking for outsourced support to empower your in-house CFO and optimize your finances? Consider D&V Philippines. Our team of accountants is highly experienced in assisting CFOs and other top-level executives and can increase the operational capacity of your accounting department. 

Armed with regular training and powerful accounting software, they can help make your accounting processes more accurate and efficient. Contact us today for a free consultation.     

You may also visit our website to find out what our clients say about us and download our Premier CFO Solutions today to learn how our globally competitive finance and accounting professionals can help you achieve faster, smarter, and more accurate business insights.