With the introduction of the concept of Virtual CFO, small businesses now receive support that they could not have afford previously. Virtual CFO has crafted a way for small companies to get access to an experienced financial professional at an affordable cost. Though the services of CFO differ from firm to firm,

However, the following services are common and often rendered to every firm that hires a Virtual CFO:

1. It takes control of all the duties of a traditional CFO, but solely on a part-time basis

1. Keeps an eye on the financial health of the business usually by adopting cloud technology

1. Offer financial guidance and insight to the business on matters related to finance.

1. Give companies back-office functions which include managing account ledgers, depending on the client and their needs.
   

Organizations deal with many challenges daily in terms of financial aspects, growth, accounting, and management. To curb those challenges, a need arises to appoint a Virtual CFO who can primarily be responsible for managing activities like financial reporting, record keeping and financial risks of the company. The presence of a Virtual CFO helps in meeting those challenges effectively by giving financial and professional aid, analysis and support to the management. Often companies that cannot afford to have an in-house CFO prefers to go with a Virtual CFO.

Growing Face of Accounting

Accounting is experiencing some significant changes in the process of its growth; the number of firms has increased exponentially who are vying with each other. Small private companies currently have so many decisions that standard services like tax preparation, bookkeeping, and compliance are turning out to be commoditised. There's so little differentiation in this packed market that it has affected the market value of these services.

Cloud technology is taking over accounting and is also reducing the basic value of accounting services. Firms that eloquently use cloud technology to manage their finance and accounting departments are more productive and efficient.

Benefits of Virtual CFO Services

1. Helps In Maintaining Accounting Records
   

Virtual CFO will help you in maintaining accounting records according to accounting standards. As we know, the financial statements of any business are created following the norms of the accounting standards as mentioned by the government authority.

1. Budgeting
   

Effective and thoughtful budgeting maintains a proper cash flow in the business. Budgeting helps in evaluating the cash requirement by harmonizing the income and the expense.

1. Financial Analysis
   

Virtual CFO also helps in the organisation's decision-making process, which ultimately leads to the growth of the business. It analyzes the finances and operations of the company by using the identification of key operation indicators.

1. Improve Profitability
   

Virtual CFO services protect your resources from any sort of wastage. A properly planned and executed strategy improves the overall productivity of the business.

1. Cash Flow Projections
   

Cash flow projections give a proper view of the company's cash position. This helps in drafting a plan which will fulfil the cash requirement of the company to meet the needs.

1. Financial Projections
   

A financial projection is worried about the conjecture of income and costs. It includes forecasts of market factors. It helps in the assurance of cash and asset requirement.

1. Key Performance Indicators
   

Key performance indicators keep an eye on the company's current market and financial condition and hence predict the future. Every business has multiple aspects such as production, sales, cash, distribution, cash collections and inventory levels, which show the KPIs. The virtual CFO frequently track and analyze such factors.

1. Growth Plan
   

Virtual CFO deals with the organisation's financials, which helps develop the business. The virtual CFO makes an appropriate development plan. It is required to make a development arrangement to recognize when financing is required in the business.

1. Organizational Structure
   

Virtual CFO services have the power to make any changes in the company's organisational structure as and when needed for the growth of the business.

1. Risk Assessment
   

Virtual CFO recognizes risks and makes decisions to curb the level of risk which may influence business over the long haul. This is done to lessen the dangers and improve opportunities.

 

Created & Posted by (Ramesh Kumar Gupta)

Senior Accounts Manager at TAXAJ

 

TAXAJ is a consortium of CA, CS, Advocates & Professionals from specific fields to provide you with a One-Stop Solution for all your Business, Financial, Taxation & Legal Matters under One Roof. Some of them are: Launch Your Start-Up Company/Business, Trademark & Brand Registration, Digital Marketing, E-Stamp Paper Online, Closure of Business, Legal Services, Payroll Services, etc. For any further queries related to this or anything else, visit TAXAJ

 

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