By Analytix Editorial Team
Decision-making is key to growing a business. For any small business, regardless of its industry, decision-making is what will ultimately determine the future of the business and the direction it takes.
Why a CFO in particular?
Accounting and financial management play a large role in business decision-making. For this reason, it is vital that your accounts and bookkeeping are as accurate and reliable as possible. Once you ensure that financial reports are all in order, it depends on a person with relevant experience and professional expertise to translate the data into information that actually helps with the decision-making process. Your CFO can help your business in various ways, from interpreting figures, to goal-setting on the basis of KPIs, to formulating budgets and forecasting effectively.
Consider the need for a CFO role in any business, particularly within these areas:
Budgets are by far the most important aspect of business growth and a CFO can help to not just formulate realistic budgets, but also help with budgeting forecasts. Budgets are not just about allocating funds to different needs of the business, but also about operational costs and expenses, funds needed to procure essential infrastructure and manpower, start-up costs, and even expected income and revenue.
ACFO will be able to help out in all of these areas, as well as guide in areas of projection and cost estimates.
Cash flow management
Cash flow is the best indicator of how much cash you actually have. Your CFO should be able to guide you better on effective cash flow management. This means paying off dues without incurring interest and recovering money owed to your business by customers. All of this helps you keep track of available cash so you can ensure smarter business investment.
Financial Analysis (Get Complimentary Analysis Now)
Financial modeling, including capital budgeting, management decision-making, and cost of capital calculations are all functions of the CFO role. Each of these activities influences the growth strategy of the small business. While software definitely exists to help with these activities, accurate interpretation of the figures can only be performed by qualified professionals, who will ultimately drive the financial decision-making process.
Bringing it all together
The CFO brings together the CPA and management information to make effective business insights. However, for a small business, it may not always be easy hiring a CFO or CFO-level expertise. Most of the time, the costs associated with such a hire are prohibitive and unaffordable for a small business or a startup.
However, a CFO role is not easily substituted without hindering the growth prospects of a business. Therefore it is better to outsource the responsibility. In outsourcing, you not only ensure your business is guided by the expertise needed, you also bring about higher profitability through better management.
At Analytix Solutions, we assist small businesses and companies in growth and expansion through better accounting practices and informed decision-making. For more information on our services, please visit us at www.analytixaccounting.com or email us at email@example.com.