Chief Financial Officer (CFO) is a term that refers to a senior executive who is responsible for managing all the actions related to the finance of the company. The primary duty of the CFO is to keep the track of the cash flows and the financial planning is also carried out by the CFO through the strengths and weaknesses of the company and providing the right actions. Furthermore, the CFO is responsible for managing the finance and accounting partitions and ensures that the reports regarding the finance are accurate and finalized annually. The company also indulges in participating with the senior managers and contributes to the overall success of the company. There are many responsibilities of the CFO that has helped the company in improving their productivity and also increased their profitability, such as-

• creating an accounting team
• ensuring accurate revenues and balances must be composed
• determining the functions of financial planning and analyzing
• giving opinions and recommendations on the mergers and acquisitions
• reporting the finance transaction
• working with the department heads in order to identify and analyze the financial data
• minimizing the risk assessment as well as reducing costs
• increased profitability
• sustainable benefits

Types of CFO services

There are various types of CFO services that are available for the start-ups' company, such as –

Virtual CFO services – The virtual CFO services are directed in sales and strategic planning. The services provided by the virtual CFO are similar to the actual CFO’s services, but the only difference is they are not available physically in the office. They assist through remote places. The virtual CFOs provide an accurate report for the management information system (MIS) time-to-time. The virtual CFO focuses on maintaining the framework of a well-structured accounting system in order to sustain the functioning of the company. Also, the Virtual CFO helps in maintaining and tracking the overall budgets of the company and provides proper direction in order to accomplish the company’s goals.

Interim CFO services – The interim CFO are considered as the highly experienced professionals in the field of finance. The primary duty of the interim CFO is to come up with strategies for the company, measure the financial condition, and implement ideas in order to improve the financial condition of the company. As being a professional, the interim CFO functions in a short time and increases productivity. The interim CFO assists in making wise decisions through gathered data and information. Lastly, the interim CFO saves the company from a cash crisis by analyzing and determining the financial health of the company.

Outsourced CFO services – The outsourced CFO functions all the operations of the CFO but they work on a contract basis rather than joining the company. The outsourced CFO ensures in saving the money of the company. He brings a new perspective as well as flexibility by his CFO services to the company. The outsourced CFO helps the company in adjusting to the engagement as it evolves.

Part-time CFO services – The part-time CFO has equal experience of that of CFO’s but, they help the small businesses in increasing their profits. They are budget-friendly and charge the firm according to their working hours. The part-time CFO helps in managing the assets efficiently and this helps the company in collecting the revenue on time. The part-time CFO gives appropriate advice regarding finance based on the provided data and strategies to the company.

Benefits of CFO services –

The CFO directs the finance and accounting team and develops a broader view of the financial health of the organization. Rather than this, there are many benefits of the CFO services, such as-

Leadership skills – The leadership skills of the CFO help in assembling and creating effective accounting and finance team. They understand the needs of the company and at what point they can add the needs.

Industry knowledge - The CFO has the knowledge of the industries and how it functions, therefore, the CFO helps in enabling the benchmark of the company against peers.

Growth experience – The CFO helps in finding appropriate opportunities regarding investment and helps in using the capital sensibly.

Risk assessment and management – The CFO determines and analyzes the financial health of the company frequently. He helps in analyzing the occurrence of danger from too much debt or too much liquidity and helps the company in lowering such circumstances.

Role of CFO in start-ups

As mentioned above, the CFO looks after the financial transactions that take place within the organization and it also helps in creating an accounting and finance team. Not only this, but the CFO is also participating with the senior managers of every department and provides their ideas and opinions on the betterment of the company. Similarly, in start-ups, the CFO plays a role in providing advice and counselling in order to increase the growth of the company. The CFO helps in creating orderly and control-centric growth of the company. As the need for finance is the primary element of every business, the CFO ensures in creating discipline across the organisation and provides direction to the company. Furthermore, the CFO also provides effective strategies to the company to enhance the improvements.

Need of CFO in business

The CFO participates in improving the current situation of the company by giving their ideas and opinions. They also participate in the decision-making process with the senior executives of the company. The CFO is responsible for reviewing and evaluating the financial accounts of the company and ensures that the goals and objectives of the company are accomplished effectively. They also assist in the development of budget and forecast models in order to better understand the financial status of the company’s past, present, and future. Furthermore, the CFO helps in maintaining accurate business rapport regarding finance and ensures that all the legal contracts are fulfilled in order to sustain the business. Lastly, the CFO also ensures in minimizing the risk that can take place within the organization and he also helps in avoiding any potential that might appear as an obstacle in the growth of the business.