Hiring a Fractional CFO: What You Should Know
Many small businesses are not able to afford a full-time CFO and turn to fractional CFO as an interim solution. But is this the best option for your business? To find out, you need to carefully consider the benefits of hiring a fractional CFO. You must also examine the drawbacks and risks that come with this type of arrangement before making your final decision.
Here are some things for you to think about:
What will be my responsibilities as an owner? You need to know this before you hire a fractional CFO.
What is the cost of hiring an employee? You also need to know this upfront because it will affect your cash flow and lead time for getting things done.
Do I have enough staff or financial resources in order to support my business? If not, you are going to want to consider other options before hiring a fractional CFO.
Finally, what are the benefits of having a full-time vs. part-time CFO? There’s no set answer here since every company is different but there may be tax implications that come with working with only one type of accountant while others could help increase productivity if they’re involved closely on projects throughout their duration.
How often will I interact with my CFO? This depends on your needs but it’s important to know what the expectations will be for both parties before signing any agreements.
Will they have full access to all financial documents on behalf or do I need oversight? It’s best to discuss this up front to avoid any confusion and miscommunication down the line.
Will they be able to handle all of my accounting needs or will I need other resources? A fractional CFO is usually only going to do certain tasks such as preparing financial statements, taxes and audits so you may need a different type of accountant for your bookkeeping.
You may find that hiring a fractional CFO can help you grow your business faster than before. You also might find that it’s not the best option, especially if you don’t have enough time or money on your side. It’s important to do some research into all aspects so that you make an informed decision about how much involvement from outside sources like a fractional CFO would benefit your small business. Once again, please note: Hiring a Fractional CFO does not relieve any owner from their responsibility to the company.