Chief Financial Officer (CFO) is an expensive and critical position. No company should take the procedure of hiring a CFO lightly as it is a mattering job, so you should know when do you need to hire and whom you should choose. Read this guide thoroughly for comprehensive knowledge about a CFO.
CFO is the leader of the financial affairs of a business. Their job is to study the stats and make strategies accordingly using their skills and experience. Their main job is forecasting, planning, and analysis of the business. They make decisions according to the conditions and financial strengths of the company.
Every business has a whole team; CFO is not alone responsible for the whole thing. They work with different officers such as Chief Operation Officer to identify different opportunities or prevailing risks. CFO directly reports to the board of directors and Chief Executive Officer of the company. CFO is regarded as senior director of the company, and their job is to make financial reports of the company correctly, without any error. Some of the CFO's duties include data analysis, fundraising, reporting to stakeholders, record keeping, etc.
A CFO is considered the backbone of every business. With critical analysis, they can help in making a road map for the company and its growth.
Deciding when your business needs a CFO is a tough job as if your profits are not enough, you won't be able to afford them, and if you didn't hire one at the right time, you might miss the chances to catapult the business forward. Most companies don't hire a CFO until they are making above multi-million dollars revenue in a year.
You should not commit the mistake of hiring a CFO if your revenue is below at least a million dollars. And if you critically need a CFO to manage your financial issues, you can go for a part-time CFO from a professional chartered accountants firm. In this case, you can benefit from the skills of a part-time CFO at a lower price compared to a full-time. Knowing when to hire a CFO depends on several points, your business growth rate, competition, revenues, future expectations, and how capable your financial team is. If you are looking for investors, you need to make the financial condition of your business very clear in front of them to gain their trust. A CFO will help a lot in this scenario as it will send a gesture that you have an experienced high-paid person to look after the strategies and growth of the business. As your business grows, you need to ensure a few things such as, can you sustain the rapid growth and handle the pressure, does the financial team of your business has knowledge about developing strategies and policies, cash flow, bottom line, profit, and loss, etc. If you think your team is capable enough to coup up with these things, you don't need to hire a CFO but if not, then go for a part-time CFO to benefit from their commendable skills and experience.
CFO is an extraordinarily expert person. They know things that you are unaware of about your business. They make accurate calculations about the current sales and profits of the company and make future decisions accordingly. They know when is the right time to expand the business further and target more customers. Moreover, CFO knows what your business is lacking and how it can be improved.
While running a business, you will get to know many hidden costs that you didn't have ever expected, such as the cost of maintaining a regularly demanding customer. A professional chartered accountant can only calculate them by putting all the data on a chart and analyzing the facts and figures. Aside from the cost calculation, CFO handles many other tasks:
You can hire CFO just like any other employees of the company. It would be best if you advertise it online and, in a newspaper, to reach maximum talented people. Hiring a CFO is a difficult task as you will need to find a trustworthy and highly experienced person because it is an expensive post. If you are a start-up or an SME, you might not be interested in wasting time in interviews, and you will not have a big budget to pay for a full-time CFO. For start-ups and SMEs, it is recommended to hire a part-time CFO from a professional chartered accountant firm.
A part-time CFO is a lot propitious for start-ups and SMEs. They are affordable compared to a full-time CFO, so they save your company's salary cost, which you can utilize somewhere else. You get to work with highly talented people and can change your CFO whenever you aren’t satisfied. It also saves money from office space and other small expenses. Furthermore, when you indulge with different CFOs, you can learn from their past experiences, which will help you build effective future strategies for your business.
CFO is the main part of every growing business. Any business without a CFO is unlikely to attract growth and investors. Hire a part-time CFO from a reputable and professional Chartered Accountants to ensure the rapid and smooth development of your company. Zaitox is a seasoned professional chartered accountants firm with more than 20 years of experience. A CFO from Zaitox will boost your business to flourish and grow.
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