What does a CFO do?

What does a CFO do?

The CEO of VerticalResponse, Janine Popick, wrote an interesting blog about what a CFO should be like and how, in hindsight, she might have done things differently. The blog is here.

The outsourced CFO is one option that many small and medium-sized businesses are turning to. Naturally, corporate financial management is not the only industry experiencing this outsourcing trend. There are numerous outsourcing websites, with guru.com, odesk.com, and freelancer among the most well-known examples. expert360.com, fiverr.com, and com.

These are establishing a new lean model for running a business, and business owners are realizing how important it is to have affordable, reliable, and expert assistance that doesn’t require a long-term commitment. Even though the typical freelance CFO will charge less per hour, it’s important to think of this as an investment in the company rather than a cost.

In fact, some consultants are willing to accept payment on a contingency basis, which means that you only pay them a predetermined percentage of any increase in profit or revenue. The owner of the business must, however, give some thought to how to make the most of this resource given the cost. For as little as $1,000 per month, small and medium-sized businesses (SMEs) can have ongoing access to a CFO’s experience and expertise, or they can hire a CFO to work on a specific project, such as advising on an investment opportunity or assisting with the preparation of the business for sale when the owners retire.

First and foremost, a CFO, accountant, and bookkeeper should not be confused. A bookkeeper—which, by the way, is the only English word with three consecutive double letters—is a bookkeeper is the traditional “beancounter,” who uses software from an accounting system to process paperwork and make entries in the general ledger. They typically report to the owner of the company in smaller businesses and typically prepare information for the outsourced tax accountant to use.