How to set up a vCFO service in your firm

Digitisation and financial analytics in a fast-paced world are transforming the traditional CFO role.

The owners of SMEs now have real time access to financial information in a way that was previously only available to larger firms. They are looking for professional advice on how to use this information to plan for growth and value within their business. Accountants in public practice are ideally suited to provide this service through technology and a strong focus on communication.

We recently surveyed around 120 accounting firms interested in developing their vCFO services. Not surprisingly, 80 % of firms described this service as unstructured and ad hoc. Usually the partners provide this service with some support from accountants and bookkeepers with the development of reports. In order to provide this service on a consistent basis, a strong leveraged platform needs to be developed.

The top 3 services provided as part of the ‘vCFO’ platform were financial reporting (90%), payroll (82%) and bookkeeping services (78%). Other services were mentioned below. Again, care should be taken in reviewing these responses, as it’s clear that most firms provide these services in an ad hoc manner, usually in response to a specific client need or request.

We also asked the firms which software tools they were using to provide these services. The top 10 responses were:

Other platforms mentioned included Maus, Castaway, Asana, Benchmarking.com, Forecast 5, Plan Guru and Zoom. Clearly firms use a variety of tools focusing on financial reporting and forecasting, data analysis and review, project and workflow management.

When asked what key projects firms were undertaking to develop vCFO capability, responses included:

1. General work with existing clients to implement more of a formal advisory service and services additional to bookkeeping and compliance work.
2. Formal process documentation for lower tier clients to ensure consistency across basic functions and allow more focus on developing vCFO services
3. Take time to learn software programs in more depth and better understand the needs of our clients in respect to services we may be able to offer
4. Look at how we can better report information for our vCFO clients. So potentially employing someone to produce Power BI reports.
5. Focus on scoping of services, pricing, updating website, membership into a vCFO association, related seminars & training
6. Position and offer to clients and market through development of structured service packages
7. Establish reporting systems for efficient client service delivery
8. Move myself away from the data processing within my firm and value add via CFO services
9. Developing a structured service offering with differing packages to suit clients of all sizes
10. Addition of practice manager to support me
11. Training & development of standardised processes
12. Consistency in service offering by central point of leadership.
13. Focus on existing and potential clients for vCFO and formalising a vCFO approach within the firm.
14. Engage an external consultant. Targeted marketing for vCFO.
15. Focus on developing procedures for monthly accounting and reporting to boards
16. Formalise our vCFO service so we have a dedicated team to deliver the services
17. Develop a vCFO strategy and creation of a team

Firms serious about developing vCFO services recognise that they need to create both capacity and leverage if they are to be in a position where they can service clients effectively and profitably. For any firm struggling to meet its existing client service needs, a formal structure for the development of a vCFO platform is essential.

The vCFO eLearning Course provides a step by step guide to structuring your service platform. Over 8 modules, we discuss the key steps to identify the services you can provide, position these services effectively, get clients across the line and deliver services in a way that adds ongoing value. We review some of the key challenges that firms face in delivering vCFO services including price sensitivity, scope creep and reducing value.

If you’d like to know more about the vCFO course, CLICK HERE. This course is available as a self-paced eLearning course and can be completed at a time and place that suits you.

www.cpdforaccountants.com.au

 

Dale Crosby

Director | Senior Consultant & Facilitator at For Accountants | High Tech Soft Touch
Dale Crosby specialises in change management and has a specific interest in client ommunication and integration of compliance, business advisory and financial advisory services within accounting firms. He has worked closely with accounting firms throughout Australia and New Zealand over the past 15 years.
Dale Crosby

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Dale Crosby

Dale Crosby specialises in change management and has a specific interest in client ommunication and integration of compliance, business advisory and financial advisory services within accounting firms. He has worked closely with accounting firms throughout Australia and New Zealand over the past 15 years.