Business owners, how often do you speak with your CPA? Monthly, quarterly, annually?
If so, your CPA is working in the “PAST”! Honestly how do they build your business working only on historical numbers? How does that CPA help you grow your business?
They CAN’T! It’s impossible to do without being an intricate part of your business daily or at most weekly.
I literally was so frustrated by this when I sold my previous accounting and tax practice. My clients needed more and I couldn’t give it to them because the typical CPA tax/accounting practice just doesn’t have the time to spend with clients even though we should.
These clients, and many of you, needed a CFO and controller and couldn’t afford to hire for such positions…why?
Because the business couldn’t meet the expense of it AND they weren’t growing fast enough to justify it!
That’s when we made the change to how we did business.
We couldn’t bear to see small business clients struggle through this critical growth stage. We saw a need to help and serve entrepreneurs at a much deeper level, thus here we are today!
So do you have a CFO?
Probably not and that’s OK!
But allow me to go step by step here and explain just why YOU DO!
Here are the top 3 reasons most business owners do not have a CFO.
1.The Cost Is Too Exorbitant.
I get it, you don’t have the money to pay a full-time CFO $100k or more in salary, payroll taxes, workers compensation insurance, health benefits, pension, vacation time, sick time, personal time, etc, etc.
The aforementioned will cost the business owner somewhere about $175k per year in total depending on where you are located.
HOLY MOLY! That’s a lot of money.
Add a controller to that mix at approximately $65k per year plus all those benefits listed above…it’s a big cost, especially if you are new in business or are building the business.
“So what’s the answer, Becky?” you ask. “You tell me I need a CFO but how can I afford it?”
What if I told you that you could hire a CFO on a part-time basis, project basis or interim basis for a FRACTION of the cost?
Most businesses don’t need a CFO full time. You only need to hire them for the amount of time you need them.
As an independent contractor you don’t have to pay benefits, vacation time, sick time or payroll taxes. On a weekly basis for pennies on the dollar of that $175k price tag, you can still gain the benefit of their knowledge and expertise 100%.
2. The purpose of a CFO is not clear. What do they actually do and what purpose do they serve?
Speaking about expertise, what does a CFO actually do?
What does that mean?
They make the numbers tell a story to the owners in order to project forward based thinking.
It’s kind of like how you need the dashboard of a vehicle to drive the car. The timeliness and accuracy of the financial statements is your dashboard (this information is generated by the CFO!). It’s the only way businesses can make sound decisions about the direction of their future!
The CFO also bridges the gap from the bookkeeper and controller to the CPA.
The CFO is the ringleader that stands in center ring providing this information to owners, banks, insurance brokers, etc. They take the burden of producing the numbers off the business owner. A weight off your chest!
CFO’s are also responsible for the current financial condition of the company. Decisions about savings, investing, risk and liquidity all falls on the lap of the CFO…talk about important?!
The CFO oversees the capital structure of the company as well. That means they determine the best mix of debt, equity and internal financing. Should you borrow money for the purchase of equipment or launch of a new project? The CFO will help guide you.
3. The lack of understanding of how instrumental a CFO is to catapulting a business forward.
A CFO helps move and drive the business forward through economic strategy and forecasting. They are also responsible for the past, present and future financial condition of a company. What a huge role!
They identify areas that are working and not working within the company so as to know where the largest profit margins are. This is so important in determining the future of the company.
What’s working = keep doing it. What’s not working = fix it or drop it.
But how do you know this without the numbers and someone to guide you through effectively and efficiently?
The CFO understands the financial blueprint of the company. They are best suited for assisting the company for improvement from the top down.
One of the last points I would like to make is that a CFO looks at the economy and determines how the business could be affected by a rise or fall.
They position the company to be able to prosper and survive even in the worst conditions.
So I ask you, do you think you need a CFO to help you with your business?
I KNOW SO!