Virtual CFO (or short term CEO) stands for Virtual Technical Manager. A CFO is an external service provider that provides highly skilled assistance in the financial requirements of an organization, just as the CFO of large organizations does. A default CFO may be one person or entity.
Virtual CFO Target market
Emerging ecosystem breeding has generated specialized service providers that fit the requirements of startups. A virtual financial manager is a skilled service provider. Startups normally do not have the sources to hire a full-time financial manager. Startups want to keep their fixed costs low and having an outsourcing service provider provides them with the flexibility to choose services as and when required. Virtual Financial Manager provides strategic and value-added services to startups that cannot be provided by an accountant. In the United States, CFO services are typically used by SMEs with annual sales in excess of $ 1,000,000.
The main role of the Chief Financial Officer in any organization is to oversee financial preparation, maintain and report on financial actions and manage the financial risks of the business. The Virtual CFO provides the same services, but since the CFO subscribers are small companies and startups, there are some services that are expected of them. The services provided by the virtual finance manager often follow the funding pyramid of needs. At the basic level, the default CFO is expected to be the client’s bookmaker and should be responsible for the accuracy of the books of accounts and the interpretation of information from the accounting statements to the client. They are responsible for carrying out or supervising the reporting process. On the more strategic side, it is the company’s financial and strategic partner of the CEO. In addition, they are also responsible for proposing measures to control expenditures and obtain capital at a low cost.
Small businesses may need a weekly or biweekly control unit. CFOs also provide one-time assistance in strategic transactions, financial operations, business plans and budgeting.
In the US, virtual CFOs earn between $ 55 and $ 250 per hour, according to their level of experience. Customers are billed by the hour or monthly rate depending on the nature of the service. Most companies offer tailor-made services and service fees vary from client to client, and this practice is gaining much momentum in India, with a thriving startup and SME culture in the nation. This sector has created new virtual CFO companies in the last three or four years, mainly because startups want to focus on their core areas, leaving the technical function of technical people.
However, perfection should be made between this practice and the outsourcing of funding. It is generally understood that outsourcing in finance refers to the process of transnational outsourcing, in which financial management of companies from Western countries is generally outsourced to low-wage group countries, such as India, South Africa, Brazil, etc.
There is currently no formal requirement for qualifications to be held by the CFO. However, it is generally demanded a virtual finance manager to obtain relevant university degree finance, professional accounting qualifications and adequate, relevant experience.
In addition, Virtual CFOs can obtain a Certified Cloud Financial Professional (QCCFO) certification produced by the International Association of the Qualified Cloud Accountants (IAQCA) that focuses specifically on the knowledge needed by money professionals delivering their services in an online and cloud environment.
The evolving nature of the business ecosystem has encouraged today to work with consultants to minimize their F&A risks of non-compliance, lack of information, lack of internal skillsets, diminishing key staff, etc.
As your partner, we not only play an advisory role, but also hold accounting and financial functions including ERP implementation, legacy accounting, and audit support. We have 50+ years of experience in F&A function and have let us build a strong ecosystem with the best industrial practices. Partner-led approach and in-depth knowledge of the range benefits our customers in minimizing the risks associated with F&A function
Our dedicated team can help you in any / all of your needs:
Often, companies lack the sole control of finance or CFO. This can be due to various reasons, such as setting up a business in a new location (leaving no time to focus on the financial aspects of a business), depleting key employees and senior management, or perhaps the evolution of the accounting and compliance scene creating a rarity for skilled financial management.
Our dedicated team helps you ensure continuous reporting and compliance by handling your daily F&A activities. We deal with a full range of F&A services, including accounting and bookkeeping, banking support, auditing closure support, F&A function for the Board or other parties, financial decision making, compliance and regulatory deposit, improvement of the funding process, internal control audit
Health Check/Clean-up of Books
Ineffective practices adopted by F&A staff, over time, lead to dysfunctional books. This undermines the reliability of financial statements and leads to non-compliance with existing laws.
Our team can help you conduct a comprehensive health check of your books and clean your records. A typical book cleaning procedure could include an in-depth book review, inter-firm adjustments, compliance checks, proof of fixed assets and other functions.
Financial Statements Closure & Audit support
The modern institution finds it increasingly difficult to deal with audits and auditors. These difficulties may stem either from staff lack of experience in managing audits or systems that are constantly expanding.
Deeply rooted in the field of escrow, our team can help you manage auditors professionally, complete timely audits, and reduce audit qualifications. Audit support usually includes the preparation of financial statements in accordance with applicable accounting standards, coordination with auditors, preparation of audit schedules, advice on audit observations or qualifications, and representation with the Board of Directors or the Audit Committee.
The shifts that the centres are making towards the criteria are increasing from other plans. This shift requires that these companies be wary of many aspects that may fall outside the scope of the financial mission.
We can guide you through this transition by analyzing the impact of convergence, supporting decisions on accounting policy options, preparing financial statements (including the opening budget), implementing new reporting processes, and making changes to the ERP system.
Support the implementation of the ERP system
Implementing the new ERP system in the existing environment or modifying the existing ERP system can be a difficult task for established entities. The main obstacles in this process include the lack of experience or discrepancies in the framed requirements of consultants in the ERP system.
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