Outsourced accounting services have been popular among business owners because of its many benefits. With trained CFO professionals, outsourced CFO services help the business in managing their finances in a less hassle way, and a more organized and secured financial management. It also helps grow and make more money in your business.
So, do you think you should consider outsourced CFO services? In making a good decision it is important to weigh the pros and cons so you can identify if it’s the right thing for your business. Here are the pros and cons of outsourced CFO services.
3 Major Pros and Cons of Outsourced CFO Services
Some of the main pros and cons of Outsourced CFO Services are-
Pros of Outsourced CFO Services
Here are some benefits of CFO services:
1. It is more cost-effective
Hiring an outsourced CFO Service provider is cheaper and cost-effective than hiring an in-house staff because you won’t have to pay for health insurance, PTO, retirement, vacation and sick leave credits, and other compensations. Another benefit is that outsourced CFO services provide you a team of financial experts which will guarantee you reliable, secure and quality financial management.
2. Experienced Guidance
As I’ve mentioned, outsourced CFO services contain professionals, and these professionals are already exposed to many areas of accounting for a long time. Compared to hiring an in house staff, they will not only crunch the numbers but also provides financial guidance and can identify errors and implications in your business.
3. Reduce Fraud
Like any other business, small or large, Fraud is next to a nightmare. This is usually caused by one person or more at the helm of accounting. Many businesses have already experienced it and it’s easy to see why- one can easily manipulate the bookkeeping or the expenses and sometimes, it goes unnoticed for years. This can be caused by poor handling, lack of knowledge or carelessness of the employee.
With outsourced CFO services, you have many professionals act as a lookout on your transactions and reports, which will have more internal control. They are also more likely to identify anomalies and errors quickly than one employee who handles it all.
Cons of Outsourced CFO Services
Here are some disadvantages of CFO services:
1. It has hidden costs
Like any other service, there could be some additional fees especially if there is one task that results in multiple tasks and charged to you without knowing. To avoid this, make your terms and conditions clear and set the expectations already by the start of the contract.
2. Less control over your business
Even from the word outsourced, business owners start to worry because they might lose control of their accounting if they availed outsourced CFO services. Not seeing your financial performance and transactions can be worrisome and owners might feel something wrong will happen.
That’s why it is very important to have constant communication and transparency with your local CPA or accountant. You can do this by having a scheduled meeting once a week or every quarter to monitor the business’s financial performance and overall transactions. In this way, you won’t be in the dark and also to gain control over your business.
3. Limits in communication
Having people who are working for you physically present in the office provides convenience in communication which may be difficult if you are availing outsourced CFO services. However, this can be easily solved especially in this modern world. There are available chat systems, like Slack and Hipchat which are used by many freelancers. Be sure to have a constant communication style decided between you and the outsourced accountants.
There are pros and cons to every service and the decision will be still up to you. Choosing the right service business can be difficult, but choosing carefully and wisely will surely lead your business into places.
So what are you waiting for? Contact us to get professional Outsourced CFO Services