The CFO'S Perspective

Contrary to conventional wisdom, the Chief Financial Officer’s (CFO) principal role is not as a “scorekeeper” of past results. Rather, the CFO is the keeper and interpreter of company data, tasked with providing a disciplined quantitative approach to management decisions.

Business process outsourcing (BPO) allows CEOs to focus on the job of running the entire business instead of getting bogged down with the management of individual departments and teams.

Effective outsourcing allows both large and small companies alike to lean on senior skillsets outside of the company to provide accurate information, offer impartial feedback, and inform strategic decision making.

In fact, according to a recent Intuit study, 65% of business owners surveyed said they would be “better positioned for long-term growth if they could take a step back and look at the bigger picture.” These business owners also reported that they were involved in areas of the company such as sales, marketing, customer service, human resources, and accounting, instead of outsourcing them. It is no coincidence that these activities were taking away from their ability to focus on their core business functions. When they were asked what they should be spending their time on instead, their top answers included developing business strategy, making an impact on customers directly, and innovating product/service offerings.

Business process outsourcing allows business owners and CEOs to utilize highly experienced professionals without needing to hire internally, both managing costs and improving business agility. Furthermore, outsourcing allows business leaders to reduce stress, lessening the likelihood of executive burnout.

When a business changes ownership, the CFOs of both businesses have a particular set of duties and responsibilities. This article discusses the role of the CFO in the selling entity.

When your business gets to the point where it needs to hire a CFO, what are your options?

• Full-time In-house
• Interim Outsourced, virtual or in-house
• Fractional Outsourced, virtual or in-house

These days a lot of organizations are looking to hire virtually, which makes “hiring a virtual CFO” a hot topic. Amidst all the remote work buzz it is easy to lose your focus and forget what you were trying to accomplish in the first place by outsourcing the role.

With government assistance waning, business owners are evaluating other ways to improve cash flow.

Since slow-paying clients are one of the biggest killers of cash flow, some companies choose to sell their invoices to recoup some of that missing revenue more quickly. This strategy, known as invoice factoring, is a way for companies to get an infusion of cash from the products they have already sold or services they have already performed from a third-party that is willing to advance them the funds before customers pay.

Alternatively, companies that do not want to sell their invoices, and may not want, or can’t, pursue a line of credit with a traditional business bank, can borrow money against their invoices from a specialty lender. This strategy, known as invoice financing, not only improves cash flow but can also serve as a means of borrowing for businesses that cannot readily obtain other lines of credit.

Each strategy has differences to consider. Find out more about invoice factoring and invoice financing to determine which approach is right for your business.

Most business owners I speak to look at finance and accounting personnel as an overhead cost. While they are most certainly a cost, the benefits that a CFO brings can alter that “cost” narrative into one of “investment.” Today I will help you define a CFO's role as one who is viewing your organization in a forward-looking manner and how they can be a good investment.

In a year of uncertainties and change, the prospect of a Single Audit for the first time may seem daunting. Many nonprofits are facing this for the first time with influx of federal funds and you should rest assured that your organization has not been singled out. Here at CFO Selections we want to empower you by helping you to understand what Single Audit is, what it covers and how to prepare.

Budgeting and strategic forecasting creates a business roadmap to maintain stability and achieve growth. However, for forecasting to be accurate it needs to be modified when significant changes occur either internally or externally. This is especially important to consider this year, as supply chain disruptions and changing business regulations have drastically changed corporate outlooks across the country.

If you understand now that there is a high likelihood of needing to undergo reforecasting next year, you will be better equipped to do so when the time comes. Kory Wagner explains, “Expecting your assumptions to last through an entire year is at best naïve and at worst detrimental to your business. Incorporating reforecasting into your regular budget process, as needed, will keep you on track and help you roll with the punches.”

Some companies are reforecasting-averse, so they shorten their budgeting cycles from annual or semi-annual to quarterly or monthly to reduce their chances of needing to do so. But if 2020 has taught us anything it is that every company should be prepared to reforecast as needed because it could become a necessity at any time.

So, this year as you finalize budgets and forecasts, take the approach of “planning to re-plan.”