What’s a virtual CFO?
The virtual Finance Director or virtual CFO is a new concept. It’s a way for small businesses to get CFO support that they wouldn’t have been able to afford previously. Small businesses who hire a virtual CFO get access to an experienced financial professional at a fraction of the cost of a full-time CFO. The services will differ from firm to firm, but usually a virtual CFO will:
- Handle all the duties of a traditional CFO, but work remotely and on a part-time basis.
- Monitor the financial health and well-being of the business, usually with cloud technology.
- Offer financial insight and guidance on all company decisions and issues.
- Provide back-office functions such as managing accounts ledgers, depending on the client and their need
The changing face of accounting
The accounting profession is going through some major changes. There are now more firms competing with each other than ever before. Data from the U.S. Census Bureau shows a growth of about 1 percent. But experts estimate the number of accounting professionals has increased from about 1.5 to 2 million people over the past five years.
Small businesses now have so much choice that ordinary services like compliance, tax preparation and basic bookkeeping are becoming commoditized. There’s so little differentiation in this crowded market that the value of these services is being driven down.
Cloud technology is also reducing the value of basic accounting services. Firms using cloud-based systems are more efficient and productive. That’s because many labor and time-intensive tasks can now be automated.
Making the most of new technology for our clients
Cloud technology opens up new and profitable opportunities for clients. And communication is getting easier as mobile devices become more popular. These are leading to big changes. For example, it’s now possible to see our client’s cash flow in real-time, using cloud accounting software.
Modern technology can help accountants and bookkeepers become their clients’ trusted advisor. Our co-founders become the financial experts that help you make smart and timely business decisions.
The cloud offers several benefits:
- Cloud solutions can share data, making it easy to synchronize and transfer it between different systems.
- Cloud accounting software gives you real-time reporting and analytics features. These help you us insight into a client’s financial condition.
- Cloud accounting and business management solutions are accessible anytime, anywhere. This means we can offer virtual CFO services to our clients from any location.
Bank account reconciliation is one example of how the cloud can save you time and money. Traditional reconciliation is tedious and time consuming. Cloud accounting software can do it much faster, connecting to online bank and credit card accounts that are also in the cloud. Daily bank transactions are fed into the accounting software and matched to the corresponding transaction. Then all the user has to do is confirm the match.
This shows how cloud accounting can automate a low-value task, leaving us with more time to work on making you a more profitable business.
Advantages for small businesses
Having access to a virtual CFO can be a big benefit for a small business. Most small businesses can’t afford an experienced, knowledgeable CFO on a full-time basis and may never consider hiring one.
That’s a problem, because as many as 8 out of 10 businesses fail within two years. Reasons include failure to set themselves apart from the competition, and an inability find a profitable business model. With an accounting professional acting as their virtual CFO, they could keep their financial goals and realities clearly in sight.
Solutions For, Inc. offers an outstanding opportunity to work with Michael Lemke directly. Reach out today to learn more these valuable services and how they supplement our platform.