Fractional Controller/CFO
Small business owners - such as doctors, lawyers, engineers, architects, restaurant and hotel owners, construction and real estate experts, etc. - are excellent at what they do. However, they are rarely trained experts with respect to technical accounting or finance skills and therefore need continuous input and feedback regarding how their business is performing, what's working and what's not, how to interpret financial data and plan for future expansion, etc. Unfortunately, since bookkeepers, accountants, bankers, etc., cannot always provide the strategic guidance a small business needs to expand into tomorrow, it will overwhelm/confuse small business owners and stifle their productivity. So, how can these entrepreneurs access such high-level expertise at a fraction of their actual cost to plan their growth?
Many small businesses that are rapidly growing or expanding face a "Catch-22" situation: they lack the funding to hire full-time controllers and CFOs. However, these entrepreneurs cannot develop their businesses without these leadership roles. As a result, accounting and finance functions are in the hands of unqualified personnel, resulting in compliance and regulatory challenges and poor financial planning.
Larger companies have the resources to hire a full-time controller, director of accounting, VP of finance, chief financial officer (CFO), etc. While their smaller counterparts could genuinely benefit from the services of a financial controller or CFO, only some can afford these leadership positions. With no easy fix available for this dilemma until recently, business owners historically just "made it work" with whatever they could afford until their operations grew large enough to hire a professional.
Thankfully, the rise of the "outsourcing" business model and access to remote services makes it easy for small businesses to hire fractional controller/CFO services virtually and other outsourced client accounting services at a much earlier stage of business development.
So, what exactly is a fractional or virtual controller/CFO? As the name suggests, in a small business, this person will most likely manage the responsibilities of a Controller and/or a CFO, delivering these remotely and on a part-time or as-needed basis. This can include:
❖ Tracking profits and cash flows,
❖ Analyzing financial strengths and weaknesses,
❖ Planning for growth,
❖ Proposing corrective action as needed.
Remember that more than 95% of ALL businesses are considered "small!" The resulting impact? Most lack the luxury of hiring a full-time/in-house controller or CFO to provide much-needed technical expertise, guidance, and counsel to grow a successful business. Fortunately, these businesses can still access this valuable expertise by hiring a fractional controller/CFO part-time or otherwise as needed.
What does a “Fractional” Controller/CFO do?
Fractional controllers allow businesses to adjust their finance or management team mix as their needs change, providing a wide range of services at a fraction of the cost of hiring a full-time controller.
A fractional controller can meet your financial needs/expectations on a project or contract basis, as a stand-alone service, or as a part of a package specifically designed for your organization.
People in these roles create/manage budgets and KPIs, financial reporting and forecasting, and coordinate/reconcile audits.
They manage cash flows and ensure tax/GAAP compliance.
They produce a variety of industry-specific monthly financial reports and analyses.
They design internal controls and procedures policies.
They manage, train, and lead accounting staff.
They research and assist with new software implementations and upgrades.
When or why will I need a “Fractional” Controller/CFO?
Unfortunately, no specific litmus test or annual business revenue/expense levels are available to help pinpoint the need for a fractional controller/CFO; however, please note the following reasons suggesting why you should consider an "Outsourced or Fractional" Controller:
Your books require tax/GAAP compliance, but your current revenue leaves you unable to afford the services of a full-time controller (or perhaps the current workload falls shy of the need to do so).
Your business is growing steadily and rapidly, requiring additional business performance metrics for daily management, future growth planning, upgraded accounting systems, additional accounting staff, etc. In this case, input from a fractional controller/CFO can help diagnose the financials of your business operations and provide recommendations regarding future growth and regulatory compliance.
You already have an accounting team in place. Yet, your books are unorganized, financial statements are incomplete/inaccurate/always delayed, staff requires additional training, outdated procedures, best practices/internal controls are lacking, etc. A fractional controller/CFO is a perfect fit to research/remedy this situation before you explore any permanent solutions.
Your accounting staff is too overwhelmed to handle brand-new budgeting and planning projects.
So, what are the key benefits of engaging a “Fractional” Controller/CFO?
Outsourcing cost savings (versus full-time, in-house staff)
You only pay for the accounting services you order.
You save time and costs related to hiring, screening, training, payroll/taxes, benefits, overtime, unemployment, office space/equipment, utilities, insurance, etc.
Services that grow alongside your organization
These services are easily upgraded, downgraded, and switched out as your business grows.
Fractional controller/CFO engagement is easily customizable via the constantly evolving needs of your operations.
YBL fractional controller/CFO services are easily scalable and tailored to meet each client's needs.
Compliance with GAAP, IRS, and other regulatory requirements
Help ensure your books comply with GAAP and IRS standards to avoid expensive (and stressful!) audits.
Ensure your taxes (sales, occupancy, property, liquor, income, etc.) are paid on time.
Efficient monthly, quarterly, and yearly closes
Analyze, design, and implement SOPs to complete the books efficiently.
Ensure your books are fully ready for your CPA at the end of the year.
Complete reporting review and overhaul
Ensure your financial statements and reporting are accurate and relevant, thus improving decision-making processes.
Periodic business intelligence can translate technical accounting and financial data into easier-to-understand language.
Avoid costly mistakes and reduce the risk of loss.
Forecasting and budgeting
Develop accurate projections, forecasts, budgets, and financial models.
Carefully scrutinize your business performance.
Treasury management
Ensure cash handling and accounting procedures are secure.
Objective financial evaluation
Relevant, accurate, timely financial statements can aid critical business decision-making processes.
Gain clarity on what is working and what's not.
Growth preparation and management
Devise and implement effective cash flow strategies for optimal growth.
Optimize payment terms, improve financial systems, and forecast/budget to ensure growth.
CEO/owner coaching/counseling via feedback and recommendations
Monitor business performance monthly.
"Review, report, and recommend." (What do the numbers mean?)
Understand what's working and what's not.
Gain insight into high/low cash flows and learn improvement strategies.
Learn how to budget better and forecast.
Technology platform review, research, and replacement
Assess if your accounting system can successfully keep up with your operations.
Learn if you require additional features and reporting from your applications.
YBL is happy to research, recommend, and install an ERP to future-proof your business.
Cash flow management
Analyze your cash flow data from 18 to 36 months.
Identify trends and anomalies.
Research and recommend solutions regarding how to stabilize and increase cash flows.
Internal control improvement
Design and implement internal controls to reduce fraud/theft.
Create checklists for staff training and business process monitoring purposes.
New processes and procedures design and implementation
An experienced fractional controller/CFO can provide a wealth of technical accounting knowledge and expertise.
New processes and procedures are designed and implemented to achieve efficiencies.
These upgrades directly enhance efficiencies involving closing on time, internal controls, cash flow management, reporting, compliance, etc.
Communication efficiency
YBL will help you transmit complex, top-level information to investors, shareholders, bankers, CPAs, board members, and other stakeholders.
Special project help
A fractional controller/CFO can aid complex special projects involving budgeting and forecasting, financial modeling, what-ifs, break-even analyses, system reviews, implementation, audits, etc.
CPA tax-filing assistance
Your books will comply with GAAP & tax requirements.
Ensure your books are ready to close at year-end and file your taxes promptly.
Assist your CPA with any queries.
Accounting staff training, mentoring, and oversight
Manage your bookkeeping staff.
Train your staff in correct accounting procedures.
Maximize the use of accounting software.
YBL's Fractional Controller/CFO services are guided by data-driven analyses that seek to improve processes, procedures, personnel, profits, and performance (the 5 Ps!). Take advantage of our free consultation to learn how our client accounting services can help your business become more efficient and profitable—what do you have to lose?
Small Business Statistics
