Let me be clear, this article is trying to ENCOURAGE your accounting firm to offer Virtual CFO services to your clients because clients need help with the strategic financial management of their businesses.
Most firms will have clients that have outgrown their in-house financial management capabilities. More than likely these clients are often frustrated, worried and disappointed with unreliable and unpredictable nature of their finance and know they need help. They wake up every day hoping to find a better way – they don’t need much persuading that they need help.
In saying that, I’d advise you be realistic about the challenges. If it was easy, then everyone would be doing it.
As many firms have discovered, fulfilling the clients needs and making a decent return for the effort involved is proving to be quite a challenge.
So what are the problems Accounting firms typically encounter?.
The biggest problems they face when trying to get Virtual CFO services off the ground are pricing, scoping and resourcing. This plays out as the client become very hard ‘manage’ on the monthly agreed fee. Typically Accounting firms adopt a tiered or pyramid (senior, manager, partner) team structure It is common to hear that the client will not deal with the ‘senior’ or ‘manager’ allocated to the job but goes straight to the partner. If the Partners time has not been costed into the recurring fee, profit margins quickly get eaten away.
What strikes me about this problem is that the CFO role is part of the internal capability of a business and the owner has expectations that a Virtual CFO will be just as real actual and tangible as an in-house CFO, as and when they need them. They expect their VCFO to be accessible, available, dependable, flexible, efficient and capable. These expectations are more or less at odds with the pyramid (senior, manager, partner) team structure model.
4 Benefits of working with a VCFO Association member
- Clients get the best value outcome when they have a Virtual CFO working in harmony with their traditional compliance accountants and bookkeeping function . Our CFO’s are industry seasoned, strategic problem solvers who understand the complexity that is unique to different industry verticals.
- The Virtual CFO Association makes it easy to find the best available VCFO’s in the market. Our website is designed to be a one-stop-shop to search by Industry, Name or Location. Our strict proficiency criteria give you comfort that all members are at the top of their game and are capable of dealing directly with the client. This is much easier than finding, training inexperienced staff and dealing with staff turnover.
- We reduce risk to the firm on a few fronts. Risk of souring a client relationship by overpromising and not meeting their expectations. Risk that you will train your staff up and then they leave, whereas our members would be looking to create lifetime clients.
- Accounting firms can leverage their client relationship to make a decent return, engaging with Association of Virtual CFO’s members under a white label or sub-contract arrangement. This allows the firm to ‘package up’ the services, protect and enhance the client relationship, rather than hand it over.
Virtual CFO’s provide financial leadership for business and credibility with external stakeholders. A VCFO will be actively involved setting, reviewing and implementing strategy. They assist with establishing the reporting foundations, systems, strategic plans, budgets, forecasts as well as cash flows to ensure there is adequate funding in place to seize opportunities and grow the business. Importantly they communicate across the business, working as an integral part of the client’s management team to improve profitability.
Ultimately, VCFO’s allow business owners to focus on their clients and grow their business by driving the strategic direction and freeing them from financial management problems.
Surely this is a win-win scenario for firms, VCFO Association members and clients.
David Dillon is the President of the Virtual CFO Association.
The Virtual CFO Association is an elite peer network, advocating and promoting the emerging Virtual CFO sector within the accounting profession. Collectively the association currently has over 500 years of industry experience, with highly qualified and experienced specialists spread across more than 20 industry verticals. If you would like any more information regarding the Association of Virtual CFO’s, please visit our website www.vcfoassociation.com.au