Virtual CFO Services
Virtual CFO stands for Chief Financial Officer. He is a service provider offering high skilled assistance in financial requirements of an organization just like a Chief Financial Officer does for a large organization. A Virtual CFO maybe a single person or an entity. The mushrooming of the startup ecosystem has generated specialised service providers which fit the requirements of the startups. Virtual CFO is one such specialized service provider.
Why Virtual CFO?
The primary role of a financial officer of an organization is to see the financial planning, maintain and report on the financial activity and manage financial risk of the business. A virtual CFO provides the same services. But since the common client tell that a virtual CFO are for small businesses and startups, there are certain more services that are expected of them.
Virtual CFO are supposed to be the book-keeper of the client and has to take the responsibility for the accuracy of the account book and interpret the financial data from the accounting book to the client.
They are also responsible for suggesting measures to control expenditure and acquire capital at low cost.
Small companies may need them on a weekly or a fortnightly basis. Virtual CFO also help in one time strategic transaction, financial processes, business plans and budgeting.
Clients are invoiced hourly or monthly depending on the nature of service.
The service charges vary from client to client. This practice is gaining ground in India with thriving startup culture in the country mainly because the startup is trying to focus on the core area leaving technical job to technical people.
However, this practice should be differentiated from finance outsourcing. Finance outsourcing is commonly understood to indicate a transnational outsourcing process in which financial resources of the company is generally outsourced from the western countries. There is currently no specific qualification that a virtual CFO should hold. However it is generally expected by a CFO to have a finance related University degree, professional accountancy qualification and sufficient relevant experience.
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