Outsourced financial director: how to choose, advantages of the service

You can transfer both all functions and part of them

Small and medium-sized businesses often need to perform specific financial and economic tasks that can only be handled by a specialist such as a CFO. These tasks typically occur infrequently, perhaps once or twice a month, depending on the industry. Hiring such a specialist in-house isn't always practical, so many companies outsource CFOs to work on a specific task or for as long as needed.

Features of an outsourced financier

First of all, this is, of course, cost savings, because there will be fewer taxes and less office expenses. It is also customary to consider other advantages:

• the enterprise will not divert existing human resources to solve one-time or routine tasks;
• it is possible to remove unusual functions from specialists who do not want or are not ready to carry out serious third-party assignments;
• all tasks will be solved by professionals who are experts in the financial industry;
• all tasks will be completed on time;
• you will get a “new” look at all the existing problems of your business.

At the same time, outsourcing a financial director is always a new business opportunity.

What players are there in the market?

Small and medium market companies that want to use the service of a third-party CFO can consider several groups of players in the market:

• freelancers – we are talking about single specialists who previously worked as financiers or financial directors in the state. These are people developing private practice. In most cases, these are experienced people with the necessary set of knowledge;
• software developers – they develop software for automating and maintaining financial accounting, and at the same time they can provide related financial services. There are not many such companies, but they do exist;
• financial companies – they work exclusively with outsourcing and provide high-quality services with the obligatory signing of a contract.

Each option has its own characteristics and advantages, but it is preferable to cooperate with specialized companies.

How to evaluate an outsourced CFO

The first criterion is, of course, the level of professionalism. The financier must be able to do what you need. The following points are also important:

• industry experience;
• work methodology;
• cost of services.

In each case, before making a selection, find out why your business needs a CFO.