{"id":80914,"date":"2020-12-13t14:00:23","date_gmt":"2020-12-13t19:00:23","guid":{"rendered":"https:\/\/48e130086c.nxcli.net\/?p=80914"},"modified":"2022-01-10t13:51:18","modified_gmt":"2022-01-10t18:51:18","slug":"how-to-become-an-outsourced-virtual-cfo","status":"publish","type":"post","link":"\/\/www.g005e.com\/2020\/12\/13\/how-to-become-an-outsourced-virtual-cfo\/","title":{"rendered":"how to become an outsourced\/virtual cfo"},"content":{"rendered":"
<\/a>and how cas drives up the demand. by hitendra patil<\/i> tom, a cpa, has always been a curious person. for over 15 years, his tax practice was doing well. during the tax season, he had no time to think. but, oblivious to himself, with each tax return, he was depositing new questions in his subconscious.<\/p>\n more:<\/b> which of your existing clients are cas-fit?<\/a> | don\u2019t wear a mask<\/a> | the 8-step method for launching client accounting services<\/a> | what cas is \u2026 and is not<\/a> | client accounting services: the definitive guide<\/a> he is now a shared cfo of 12 companies. but he took up the cfo work accidentally.<\/p>\n how? plugging in the numbers into the tax returns never gratified tom. while he was working out those numbers, he was first getting curious and then frustrated because his mind was trying to figure out how the numbers came to be. he was visualizing the decisions taken by business owners that ultimately led to those numbers. and he was getting frustrated that even some glaringly obvious choices were missed by some business owners, resulting in bad numbers instead of good numbers.<\/p>\n after his usual mini-vacation after every grueling tax season, his mind went to work. he would start reading books, but his mind would be writing books, correcting the bad numbers, because he now had the hindsight that would make him make better business decisions.<\/p>\n out of a sheer chance, he decided to get into an import and distribution business. the annual turnover? $ 6 million!<\/p>\n the numbers turned out great because, inadvertently through their mistakes, so many business clients trained tom\u2019s mind to deeply understand how to make sound business decisions.<\/p>\n that\u2019s when tom knew that he could be an effective cfo. he could advise business owners by showing them how their business processes, how their financial or operational decisions, how their choices of technology, how their decisions or indecisions, everything, turn into those numbers on the financial statements and tax returns.<\/p>\n tom now routinely gets calls from ceos of the client companies \u2013 more often than ever before \u2013 to seek his advice and guidance on major financial decisions to be taken.<\/p>\n the accidental insights:<\/p>\n most not-too-small, not-too-big, growing businesses benefit immensely from having a chief financial officer (cfo) on the payroll. but, given the demand and supply gap for such talent and experience, cfo compensations can range anywhere between $200,000 a year to $500,000 a year (or more), plus benefits. it is difficult for many companies to hire a full-time cfo.<\/p>\n technological advances and cloud solutions have made it possible for expert accountants to offer cfo services to many businesses at once. such not-full-time cfos typically work remotely or part-time, or even on an on-demand basis, many times on a fixed-fee basis that justifies the time and effort of experienced accountants. in other words, companies can \u201coutsource\u201d the cfo responsibilities to a person not on their payroll. hence the term \u201coutsourced or virtual cfo\u201d (o\/v-cfo).<\/p>\n over the last couple of decades, the word \u201cstartups\u201d became a common lingo in the business world. billion-dollar \u201cunicorns\u201d were all over the news. several startups in technology, health care and other fields grew to tens and hundreds of million dollars in valuations. angel investors, venture capitalists and institutional investors flocked to pick the best bets among the startup world.<\/p>\n one common factor, irrespective of which industry the startups are in, is that all this massive inflow of money into the startup world is not just based on the business idea and the chances of success. it is based on the financial soundness of the business models of these startups.<\/p>\n cfos have been the bedrock of making sure that the startup founders are putting their best foot forward to grow to the next levels in obtaining such investments in a fiercely competitive world of startups.<\/p>\n at the same time, there are millions of businesses that start becoming successful and start growing, but hit a plateau or even start declining. more often than not, the financial acumen, controls and oversight are not the competencies of founders of such businesses, and that leads to the great potential of many companies not turning into the performance they deserve.<\/p>\n fortunately, technology is a great leveler, and it unlocks the value in ways that one could not have imagined some years ago. technological advances have made it possible for the financial expertise of accountants to be turned into higher-value-higher-fee o\/v-cfo services. and accounting firms that offer cas have distinct advantages in offering o\/v-cfo services over other firms that don\u2019t provide cas. here are some reasons why:<\/p>\n
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\ntom believed that it was his thinking power, armed with the cpa education, years of experience and knowing which tools to use effectively to produce the impeccable tax returns, that could help him make a meaningful positive difference to clients\u2019 businesses, and hence lives.<\/p>\n\n
what is an outsourced\/virtual cfo?<\/h3>\n
how does cas drive up the demand for o\/v-cfos?<\/h3>\n
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