Top 5 Reasons Small and Medium Enterprises (SME) Need Virtual

A CFO is responsible for making financial decisions for an organisation. He is a top-level C-suite executive responsible for financial planning, risk forecasting, and budgeting. This executive is also responsible for managing all the financial data of an organisation. The guidance and expertise of a virtual CFO help a company to prosper in terms of its finances. However, hiring a CFO is a long-time commitment. It is also a costly affair.

So, SME mostly considers hiring a virtual CFO instead of a full-time CFO. A virtual CFO works at a fraction of the cost of a typical CFO by performing similar tasks remotely. A group of individuals or a particular individual can be a good fit for this role. They are responsible for closely monitoring the company's financial situation and making decisions accordingly. The virtual CFO is also responsible for offering an organisation with financial stability.

Here are some of the major benefits of opting for CFO outsourced services for your organisation.

Here’s Why SME Businesses Need Virtual CFO Services:

1. Establishing a Solid Financial Foundation:

If your business is a relatively new one, then you must consider opting for virtual CFO services in India. The CFO will help build a solid financial foundation in the early days of your organisation. They will help implement various accounting software tools using which you can manage your finances appropriately. They will also help you choose the right finance management platform. A good platform allows everyday business operations can be carried out smoothly. The CFO is also responsible for offering the necessary training to the accounting staff. This makes them capable of taking care of all of the various accounting operations. The CFO is also responsible for managing payroll and other financial operations of your organisation.

Examples

• Organisation Chart with Roles and Responsibility
• Monthly Management Accounts or Statements
• Compliance Calendar
• Transaction Approval Matrix
• Vendor Master
• Customer Master
• Chart of Accounts standardisation
• Accounting Manual

2. Strategic Financial Planning and Forecasting:

Now here's another major reason for you to onboard a virtual CFO. The virtual CFO is largely responsible for financial planning and forecasting. They can predict how your business's finances might look in the future. They do so by analysing the necessary data and considering various business operations. Based on the forecast made, they carry out financial planning. This offers your company increased resilience in times of crisis. The virtual CFO also has in-depth knowledge of market factors and interest rates. They are also well aware of complex financial models based on which they conduct forecasting. They perform budgeting for startups. They also ensure that your organisation adheres to the compliance requirements.

Examples

• Annual Budget
• 90 day cash forecast
• Expense control tracker
• Improved Cash Flow Management:

Managing cash flow is yet another challenge for false SME businesses out there. By bringing in the services of a virtual CFO, you will be able to ensure that the entire cash flow management process becomes easy. You will also not have to worry about having to experience any kind of unstable financial circumstances. Your organisation will get a fresh perspective. Your business operations can be taken care of much more smoothly. The virtual CFO will carefully analyse cash inflows and outflows. They will also identify potential bottlenecks and develop various strategies to improve the cash flow efficiency. They will also offer bookkeeping services and implement cash flow forecasting models so that businesses can easily anticipate future cash needs and manage their working capital effectively.

Examples

• Financial Obligation tracker
• Accounts Payable ageing report
• Credit policy creation
• Restructuring Debt
• Cost-Effective Expertise and Access to Advanced Financial Tools:

Budgeting is a major concern for SME firms out there. Their financial resources may be heavily strained if they have to hire a full-time CFO. With a virtual CFO, you get the necessary services without paying a full-time employee. A virtual CFO also does not require any kind of additional benefits or bonuses. The pricing is mainly based on the time and deliverables your company needs. This helps you to save on cost. You also get access to highly advanced tools and technologies through which you can manage your finances easily. This not only gives your business a boost, but you are also able to carry out critical financial operations in a smooth and error-free manner.

Examples

• Implementing cash flow forecasting tools like Futrli and Fathom
• Standardising accounting systems through Xero or Zohobooks
• Scalability, Flexibility, and Network Connections:

CFOs are highly experienced executives who have vast professional networks. When you consult a virtual CFO, you get to take advantage of their network as well. This includes other executives in your industrial niche, financial advisors, and regulatory agents. This helps you ensure that your business operations are further streamlined. By opting for outsourced accounting services in India, you can also offer your business enhanced scalability. You can scale your CFO services as per your business growth. The services of a virtual CFO also offer you enhanced flexibility. You also have the provision of opting for the services of a virtual CFO for a specific plan of time or on a project basis.

Examples

• Establishing Back end accounting function overseas
• Coordinating with Auditors for quick audit closure

Conclusion:

In this way, virtual CFO services can offer your startup multiple benefits. So, if you are looking for CFO services tailored to SME business success, then you may reach out to BC Shetty & Co., One of the CA firms in Bangalore, and avail of their virtual CFO services. This will offer your business financial stability. You will also be able to navigate financial challenges with greater ease.