Part-Time CFO and Financial Vision

It is very common that resources of a small company are stretched. As a result, things like good financial information get overlooked. Too often this neglect leads to unnecessary pain. But there is a solution that is effective and affordable. The underlying issue is one of having the information and guidance required to develop a solid financial vision.

Part-time CFO

In a previous posting, Does a Part-time CFO Makes Sense?, we looked a little at some of the advantages of a Part-time CFO. Also in the posting Spend Wisely – Go Part-Time I demonstrated how this may save you money while at the same time getting you information you need to manage your business.

Cost Savings

Since the main reason many companies do not hire a Full-time CFO (or Controller) is the cost issue, let’s consider how the alternative of part-time may be the solution. In the second posting mentioned above I included an analysis of potential savings, and below I have an updated version of this analysis.

part-time cfo savings

Some Analysis

In the worksheet above I have been conservative. For example, in this case the Part-time CFO is working 15 hours a week. That is intended as an average, but the reality is that there is a high probability that this will be considerably less. Also, note that when using a Part-time CFO the assumption was made that a more skilled clerical person would be needed, so the pay rate was increased from $15 per hour to $20 per hour. That may not be necessary. Also, for the annual savings calculation 52 weeks was used for both a Full-time CFO and a Part-time CFO. However, if the Part-time CFO is performing work as a contractor then he or she would not be paid for any vacation. So, if a Full time CFO gets two weeks of vacation then that is another savings of $4.306 (Calculated as $2,153 x 2). Also, a contracting Part-time CFO will not be covered by your company’s health insurance. This is another savings of probably several thousand dollars a year.

Thoughts on Value Received

All this analysis of the cost benefit of using a Part-time CFO is just one aspect of this issue. Remember in the first paragraph the comment about financial vision. This is an area where a Part-time CFO may be of significant value to you. Because of exposure to multiple companies in a variety of industries, they may often have a valuable perspective and solutions that are more difficult for a Full-time CFO to offer. Of course, it may be that you do not even have a full-time CFO. In this case, you are operating with even less of the valuable information you need.

What about your company? Are you satisfied with the level of financial information and guidance you are receiving? Not trying to be cute with the rhyme, but perhaps a Part-time CFO is the way to go.

If you want to know more, contact AimCFO – Contact

As always, your comments are welcomed.

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