Accounting and bookkeeping services in Hyderabad > Blog > CFO > Does My Business need a Virtual CFO

Virtual CFO services have taken up the business scene by storm. There is a growing realization among start-ups or small businesses about the advantages or benefits of hiring a virtual CFO. Having said this, it is also a fact that vCFO services are not the go-to solution for all businesses. The million-dollar question we ponder here is when does a business requires a virtual CFO. Amid the uncertainty caused by the pandemic, the various virtual financial services have been a lifesaver for many business ventures. It is equally important for a business to know which service is aptly needed at different junctures in their business. 

There is a bouquet of services like, bookkeeping, accounting, or tax planning which will cater to the different needs of the businesses. The solution that worked for one business might not work for another one. Like in every business decision, multiple or unique factors influence the decision to hire a virtual CFO. Here is a checklist of some common triggers to help your business to have guided support in the role of a virtual CFO.

If so, then…

If your business is going through any of the below situations, then consider your business ready to have a virtual CFO on board.

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1. If the Business is Growing Rapidly

Growth is the ultimate aim of any business owner, but it is not easy to go through the growing pains which involve complexities associated with financials, resource allocation etc without an expert. The existing processes need to be tweaked to adapt to the growing circumstances. These changes become easy to manage under the expert eye of a vCFO. Also, a vCFO will guide the business in handling the cash inflows and it’s the allocation and efficient management of resources to the benefit of the business. 

 

2. If the Financials are Troubling or Unfavorable

Every business goes through its highs and lows. The highs need to be well-managed and the lows must be well-controlled. To control the low times, there must be a definite answer as to why it happened. The troubleshooting can be best done with the help of an expert like vCFO. The situation will be scrutinized by a vCFO to advise on the measures and technologies to improve the business’s profitability. A vCFO can also implement best practices to enhance the efficiency of the operations. 

 

3. If there is a Need for Better Insights to make Informed Decisions

It is not everyone’s cup of tea to interpret the financials or to understand its long-term or short-term impacts on the business. Uninformed decisions may lead the business to financial loss or decreased efficiency. Virtual CFOs are financial experts who will provide a clear insight into how the various data or ratios impact the future of the business. This will help the management to make bold, calculated, and proactive decisions for the betterment of the business. 

 

4. If there is Difficulty in Budgeting

Budgeting is an important activity in any business, where the capital is identified, expenditure is estimated and the revenue is predicted. It is easy when explained like this, but requires expertise and vision to actualize it. A vCFO will help the management to decide what amount needs to be allocated for short-term, long-term plans, and ongoing issues. These will be done in adherence to the financial and compliance policies.

 

5. If it is Challenging to do the Business Forecasting

Business forecasting is an expert’s playground. They use different tools and techniques to predict the developments in sales, expenditure, and profit. A vCFO will do the business forecasting, keeping in mind the budget and the business’s future goals. This will set the stage for planning the effective strategies that will work for the business.  

6. If there is Difficulty to Identify the Growth Opportunities

Every growth opportunity needs to be dissected and studied in every possible angle before investing in the same. A vCFO with expertise from different industries will have an edge over others to identify the growth and revenue generation possibilities of an opportunity. 

A successful business is all about making and executing decisions at the right time, making strategies, and implementing the compliance and risk policies to align with this growth. The role of vCFO is to help in the decision-making, proposing strategies, and implementing the policies to take the business to the next level of growth. The role of a vCFO is mentioned in detail here. At its inception, a business might have a simple, straightforward approach, but as its journey starts, all these processes become complex. A virtual CFO will smoothen the path of complexities and make it achievable. 

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We have seen that vCFO services play an important role in the growth and sustenance of a business. Diligen has set the standard for providing top-notch vCFO services with its team of experts. They have always taken that extra mile to delight the customers. Customer satisfaction has always been the priority for Diligen. 

 

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