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Key Differences Between an In-House CFO and an Outsourced CFO Partner

When you’re ready to take the step of entrusting the financial management of your business to someone else, you want to make sure you take the right step. For some businesses, that might mean hiring their own CFO as a full-time member of the team. For others, finding a trusted CFO Services partner that can provide remote support for your growing business is ideal. If you aren’t sure which option is best for you, here are a few points to consider.

The Role of the CFO

The primary role of the CFO is to manage the financial risks of the business. They are responsible for developing and implementing strategy, as well as, managing the day-to-day financial operations. The CFO provides leadership and support to other members of management when it comes to making decisions about how to grow the business and ensuring that growth is sustainable.

Is it time to hire a CFO?

There is no one-size-fits-all answer to this question. As your business grows and becomes more complex, the need for a dedicated CFO usually increases. If you are at the stage where you are ready to hire a full-time employee for this role, it’s important to consider whether you have the internal resources to support a CFO. This includes things like accounting, financial reporting, and treasury management.

One of the biggest benefits of a full-time CFO is that they can provide continuity and stability to the management team and, as a full-time employee, they are available to help oversee various financial tasks 24/7. But that all-access pass often comes at a cost, and for many small to medium-sized businesses cost is often a deterrent from finding the financial support they need.

Enter the Outsourced CFO.

The Outsourced CFO

The outsourced CFO is a new breed of financial executive that is becoming increasingly popular with small and medium-sized businesses. Outsourced CFOS provide all the same services as an in-house CFO, but they do it remotely. This means that you can get the same level of expertise and experience without the need to hire a full-time employee.

An outsourced CFO partner is often part of a larger financial services firm that can provide a suite of services to support your business. This might include things like bookkeeping, tax, and payroll. Having a team of experts in different areas of finance can be a big benefit for businesses that don’t have the internal resources to support a full-time accounting department.

Do I need a CFO or an Outsourced CFO for my Business?

The answer to this question depends on a number of factors, including the size and complexity of your business, your stage of growth, and your budget. If you are a small business with a limited budget, an outsourced CFO might be the best option for you. They can provide you with the financial support you need at a fraction of the cost of hiring a full-time employee.

Outsourced CFOs are also a good option for businesses that are growing quickly. They can provide the financial expertise and support you need to scale your business without the need to hire and train new employees. And, because they work remotely, they can often start working with you much sooner than a full-time CFO.

An In-house CFO is usually the best option for larger businesses that have the internal resources and departmental structure to support this higher-level position. CFOs provide strategic financial insight to businesses and are best supported by accounting teams that can help manage the daily financial needs of your organization, meaning that a larger investment in time, financial resources, and business structure is often needed before you hire a CFO to join your organization.

The decision of whether to hire a full-time CFO or outsource the role to a CFO Partner is one that should be based on the specific needs of your business. There is no right or wrong answer, but there are many advantages of finding the right outsourced CFO partner for your growing business.

Advantages of Working with an Outsourced CFO Partner

As with any decision you make in business, you want to make sure that the choices you make set you up for long-term success, and that’s where finding the right CFO solution is crucial.
An experienced outsourced CFO will be an integral part of helping your business monitor trends and the opportunity to ensure you stay on track as you grow.

Outsourced CFO Services are Cost-Effective

There are a number of advantages to working with an Outsourced CFO. Firstly, they are usually more affordable than hiring an in-house CFO or an accounting team. And usually, because their cost is allocated across a few different clients, you can afford a more experienced outsourced CFO team than if you hired for the role internally.

Many CFO Partners have an entire team to back your business

At SME, you get a full team of accounting specialists to help your business rather than just one person. This can be a huge benefit when it comes to things like financial reporting and compliance. Additionally, we have a vast network of financial partners and resources that we can tap into to help your business, even ones with complex financial needs.

More Experiences Means Less Time On-boarding

Outsourced CFOs can often start working with you much sooner than an in-house CFO as they don’t need to go through the same hiring process. Additionally, their years of experience will come with established tools and processes that they can plug your business into instead of starting from scratch.

The Financial Support Your Business Needs

An outsourced CFO can be a more flexible solution. You can work with a team of accounting specialists helping your business with everything from bookkeeping to tax compliance instead of sourcing solutions from a variety of providers.

Reporting and Audits

Outsourced CFOs can provide standardized reporting that will help you track your business performance and make better decisions about where to allocate resources. Additionally, because they work with a variety of clients, they are often up-to-date on the latest compliance requirements saving you time and money when it comes to audits.

Flexibility to Grow

As your business grows, an outsourced CFO can help you scale your accounting and finance function to meet the needs of a larger business. And because they are not an employee, you have the flexibility to scale up or down as needed without having to go through the process of hiring and firing.

Find the Right CFO for Your Business

Outsourced CFOs can be a great solution for businesses that need financial support but don’t have the internal resources to hire a full-time CFO or accounting team. They offer many of the same benefits as an in-house CFO, but at a lower cost and with more flexibility. If you’re thinking about outsourcing your CFO function, contact SME to learn more about how we can help your business.

SME is a leading provider of CFO Services in Georgia, South Carolina, and beyond. We work with businesses of all sizes, from startups to established enterprises, to help them grow and succeed. Contact us today to learn more about how we can help your business.

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