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As any successful business owner will tell you, there comes a point when you need to start delegating. To grow effectively, you willneed to call in the experts – especially when it comes to finance.

That’s why many businesses eventually turn to a finance director to help identify and facilitate growth and funding opportunities, evolve their financial models, and remove a great deal of strain from the shoulders of the owner.

If you’re ready to take that step, you might be wondering about your best option for hiring an FD. Full-time, in-house? Or part-time, outsourced? In this brief blog post, we’ll explain the benefits of both.

But first…

Why do you need a Finance Director?

You might think, with an accountant handling your tax returns, reporting, and annual accounts, that you don’t actually need an FD. Surely there’d be too much overlap?

Well, not necessarily. There is a real distinction between the roles, and it all boils down to how they use and interpret your numbers. An accountant is there to keep you compliant; to file returns and create reports. They’re often dealing in the financial history of the company. An FD, on the other hand, is involved in the financial futureof your organisation.

A forward-thinking FD wants to address the business’s future financial performance, and determine a funding and spending strategy. They help you establish cost models, define the business model, and save (and make) more money.

Now you have an idea as to why you need one, where should you look to hire an FD?

Hire an in-house FD – Pros & Cons

If you require a detailed overview of your financial management, and a more hands-on approach taken by someone on your behalf, the idea of an internal hire becomes quite attractive. Having a full-time, in-house FD situated along the corridor gives you that reassurance that a financial expert has an eye (or two) on the future.

By adding a full-time FD to your team, you’ll have:

  • Invaluable experience at every meeting.
  • An improved, financial-driven decision-making process.
  • Access to specialist knowledge when drawing up growth plans, or scenario planning.
  • Someone with whom to share the burden of leadership.

However, it’s not all sunshine and roses. Hiring anyone full-time comes with a few catches, and an FD is no different. For starters:

  • You’ll be shelling out a large salary plus benefits. To attract someone of adequate experience, you’ll have to pay the going rate.
  • You’ll have to justify the creation of the role. If you don’t have enough work for a full-time FD, it becomes a wasted hire.
  • By creating the role, you’re committing the business to a long-term plan.
  • And the recruitment process for a high-level position such as an FD can be drawn out and expensive.

The good news is, there is another option…

Outsource to a virtual FD

With a virtual FD, you’ll enjoy all the advantages of an in-house hire, but at a fraction of the cost. There’s no salary, benefits or additional overheads to worry about. Just access to invaluable knowledge and experience as and when required.

This is particularly useful if you’re in the early stages of business growth. It means you won’t be tied to a permanent hire, while still having that experienced hand guide you as you seek to push your company to the next level.

By working with an outsourced FD, you’ll have:

  • A qualified finance professional, who knows your industry inside out, providing high-level knowledge and expertise when you need it most.
  • Strategic support to improve efficiency and enhance your business model.
  • And flexible access to an entire team of finance experts.

It’s that last point that makes a virtual FD so valuable. Not only do you have a high-calibre financial director capable of game-changing insight, you also have an outsourced finance team that’s able to pick up the slack and deliver an end-to-end accounting function.

There’s only one choice in our mind

If you’re a busy business owner, outsourcing your entire finance function is transformative. Board reviews and reports, cash flow forecasting, monthly or quarterly management accounts, budgets and forecasts, grants and funding; it’s all taken care of on your behalf, leaving you with more time to do what you do best – run your business.

Take a leap of faith towards hiring a virtual FD and seeing what benefits and insight it can bring your business!

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