A lot of people wonder what a Virtual Financial Director is, what they do and why they might need one. We found a neat little article by Kreston Reeves which maps out five areas where you may need the help of a VFD and what they can do for you. Points 1 and 5 below particularly relate to small growing business:
“1. Great ambitions to grow, with no long-range plan in place.
This is a common occurrence in SMEs and entrepreneurial businesses where a great idea or delivery method is present, but clear stated financial objectives are not. A plan can be developed which empowers senior managers to take ownership of objectives, with a clear view as to how they measure up against the overall goals on a regular basis. This is further underpinned by development of management accounts which actually give information that leaders can make decisions on, in a timely manner.”
“5. The business has excellent product/process ideas, but little idea of the costing and profitability of the venture.
It is useful to have someone with a prudent approach to costing and profitability analysis. This not only helps to play devil’s advocate, but to ensure that the idea will ultimately achieve its desired financial and operational objectives. Business Case Analyses (BCAs) are powerful tools to ensure that the idea has every chance of succeeding, and can also be used when quoting for new opportunities.”
The rest of the article can be found here. Have a read, see what you think, and if you feel that these are areas you need assistance with, we can help.