The CFO'S Perspective

What would we do without our accountants? We rely on them for accuracy, reporting, transaction processing, analysis, and financial advice. For non-accountants, the discipline can be a mystery. So, we try to find a good accountant to add to our team and then we trust them to do their job. That’s what we should do, right?

Actually, no.

You shouldn’t trust your accountant. Well, hopefully, you can trust them, but you shouldn’t.

With all the buzz around generative AI in business, many finance professionals are eagerly waiting to see what the future will hold for AI usage in accounting and finance. Overall, the sentiment seems to be positive, although many are taking a more cautious approach as they wait to see where and how it will be utilized. But while AI integration is still in its early days for most small to mid-sized businesses, companies of all sizes across all industries have been benefiting from Machine Learning (ML) for decades and can largely credit their success to doing so.

Originally published: 3/23/2020
Updated: 1/8/2023

Why are financial projections important and how can they inform a company’s financial analysis to increase confidence in the numbers?

To answer that question, we need to take a step back. Preparing financial statements is an important first step in the business planning process because these financials form the basis for predicting business outcomes for future reporting periods.

Using that foundation financial revenue and expense projections are generated from compiling the internal and external accounting data you already use in the day-to-day management of your business. These projections allow you to get a more accurate view of how successful your business can be so you can determine what to keep and what to cut when planning.

Just the other day we were working with a client who came to us and said, “We need help with an important grant request. How do we know which expenses to include in our overhead costs? And how should we word those expenses appropriately in our proposal?” We were able to help and now we want to share the wisdom that we offered him to help you the next time you write a grant proposal.

Anyone who has ever worked with grants knows that budgeting can be one of the most difficult parts of the grant request process. To be effective a grant proposal needs to include both the direct costs of running the program(s) that the grant will be used for as well as the indirect costs (or overhead costs) associated with offering programming.

Organizations that do not appropriately account for overhead costs such as payroll, rent, utilities, and technology will not be entirely compensated for the full cost of running the programs that they offer, which can jeopardize their long-term sustainability. Simply put, an organization that cannot cover their overhead costs won’t have the operating budget needed to provide their programs and offerings to their community, which in turn can:

• Reduce reach and effectiveness.
• Negatively affect morale and increase turnover.
• Threaten the long-term viability of the organization.

When you are looking for someone to hire a CFO for your company, who do you tap for the job? What sets a great executive recruiting firm apart from a mediocre one? And how can you even tell the difference? Going through the research stage of selecting a financial recruiter can be daunting, but we’re here to help!

Our team of executive finance recruiters has put together a list of the questions they hear most often to serve as a guide as you go through the process. We’ll tell you why these questions are important and what you can hope to glean from asking them.

There's an interesting quote I hear quite regularly regarding how to act in times of strife or turmoil.

The only way out is through." – Robert Frost

If you think about it, it's a simple allegory for a moment when you may face a challenge, whether work, personal, or otherwise. Given that this is a business-related article, I'll limit my thoughts to the work environment, specifically examples facing business financial executives. The point, however, is that bemoaning the issue, or moment, or whatever the challenge may be, does very little to help you move on from that issue or moment. Action is what helps you more than any other element. Doing something is better than doing nothing almost all the time.

Do you truly understand how your organization is funded? And do know why it matters that you do?

Unfortunately, too often nonprofit leaders and board members only have a vague sense of how their organizations are funded and what that means for furthering their missions. This is a problem because funding is an integral part of an organization’s success, and the right funding mix is essential for the growth and maintenance of any nonprofit.

An organization’s funding mix can influence its overall financial health as well as determine its reach, capacity, operational flexibility, and long-term sustainability. To strike a balance between flexibility and sustainability, nonprofit leadership must have a firm handle on how the organization’s funding sources are diversified and what kind of implications that has for the organization.

A new breed of finance professionals is emerging, known as fractional CFOs."

In the ever-evolving world of finance and business, the role of the Chief Financial Officer (CFO) has undergone significant changes. Gone are the days when CFOs were primarily responsible for managing a company's finances in a traditional 9-to-5 role. Today, a new breed of finance professionals is emerging, known as fractional CFOs. These individuals are redefining the traditional CFO role by offering their expertise on a part-time or project basis to multiple companies. If you're considering a career as a fractional CFO, this article will provide insights into the role, the benefits, and what it takes to succeed in this dynamic field.

What Is a Fractional CFO?

A fractional CFO, also known as an interim CFO or part-time CFO, is a financial expert who works with multiple organizations on a contract or project basis. Rather than being a full-time employee of a single company, a fractional CFO offers their financial expertise to multiple clients. This arrangement allows businesses to access high-level financial management and strategic guidance without the cost and commitment of a full-time executive.