Key Takeaways
- A fractional CFO fills one of three roles depending on what the business needs: consultant, bookkeeper and accountant, or full CFO and executive.
- In the consultant role the work is advisory. The CFO reviews statements, makes recommendations, and meets regularly to check progress, which suits a company that already has accounting covered.
- In the bookkeeper and accountant role the work happens behind the scenes: setting up software, tracking transactions, reconciling accounts, and producing monthly financial statements.
- The executive role is the most involved and the most expensive. The CFO oversees the accounting department, joins leadership decisions, and can only be delivered to a small number of clients at once.
In our experience, a fractional CFO provides different functions for different clients. There are times when the work requires a high level of involvement, and other times when a few hours is all that is necessary.
The most common types of work for fractional CFOs are as a consultant, bookkeeper, and CFO/Executive. While the part-time CFO is capable of doing all of these jobs, clients may only require certain roles. They may only be willing to pay for specific needs, without utilizing the professional to their full capacity. Whatever the issue may be, fractional CFOs are able to transform to fit the job.
Here are the many roles and capabilities an organization like ours brings to the table:
The Consultant
This function is typically required when a client already has an accountant (and maybe even a CFO), but is looking for ways to improve their processes or financial standing. Rather than paying for the full range of services, they only require a consultant.
In this case, the part-time CFO will look over financial statements, make suggestions, and meet with the client on a regular basis to check on their progress. These meetings could be monthly, or even weekly, and can vary in length.
Sometimes a fresh outside perspective is all a company needs to increase profits. They can be perfect for short-term projects or some extra brainpower for a specific task. Need help with a budget overhaul, or want to streamline your accounting process? A fractional CFO like Fox & Partners has the experience to make it happen.
The Bookkeeper/Accountant
This role is more similar to a contractor than a consultant. In this instance, the part-time CFO would spend more time getting the financials in order. These services are often needed if a company has no accounting department, or one that is not large enough.
Many clients just need help keeping track of their finances. If so, the part-time CFO will set up accounting software, track all transactions, reconcile accounts, and create financial statements every month. Creating healthy finances is always crucial in ensuring business viability. Much of this work will go on behind the scenes with occasional meetings with ownership to ask questions or discuss next steps.
The CFO/Executive
The last role a fractional CFO typically finds themself in is as a company’s CFO/executive. This is the most involved a part-time CFO can be. In this role, they would oversee the accounting department, meet frequently with other heads of departments, and discuss big-picture changes. They’d be involved in all the company’s financial decisions and coach management on other areas of improvement.
Where a fractional CFO can handle many clients as a consultant, accountant, or bookkeeper, they can only engage with a select few clients in this capacity, due to the scope of work involved. This requires a close relationship with the client and will cost significantly more than any other role. The client is able to take advantage of the full range of expertise a fractional CFO has to offer, while still spending less money than on a traditional CFO.
Fractional CFOs come in all shapes and sizes, with the ability to morph into whichever role best suits the client. Whether they need a consultant to tackle a specific project, an experienced set of eyes keeping finances in check, or an executive to tackle big initiatives, there’s a fractional CFO for that. The client only needs to determine what they require, and the part-time CFOs will handle the rest.
If you want to hear more about how Fox & Partners can help your business thrive, please set up an introductory call with us today.
Frequently Asked Questions
Most engagements run somewhere between 10 and 30 hours a month, depending on which role you need filled. A light consulting arrangement may take a few hours. Running the accounting function and sitting in on leadership decisions takes considerably more. The scope should be set by the work, not by a fixed block of time.
The month follows a rhythm. The books close, the financials get reviewed for accuracy, reports and dashboards are updated, and then you sit down together to talk through what the numbers mean and what to do next. That recurring conversation is where most of the value shows up.
Usually not. In most cases the fractional CFO sits above the people already doing the daily work, setting the standard and reviewing the output. If nobody is handling the books at all, that gap has to be filled first, either by your team or by theirs.
The owner, or the board if there is one. A fractional CFO is not a vendor waiting for instructions and not an employee buried in the org chart. The relationship works best when they have a direct line to whoever makes the final call on money.
