How a fractional CFO could benefit your RIA firm

How a fractional CFO could benefit your RIA firm

By Rick Wilkens, CPA, CVA

What if you could tap into CFO expertise without having to keep this executive position on your firm’s payroll? With a fractional (i.e., outsourced) CFO, you can. Here’s how a fractional CFO could benefit your registered investment advisor firm today.

A high level of talent at a lower cost for your RIA firm

Adding a full-time CFO to your payroll can be a significant expense. With a fractional CFO, you get financial expertise and support that’s tailored to your firm’s needs—without the cost of an employee. Your fractional CFO can take care of everything from reconciliations to key performance indicator (KPI) analysis while also serving as an in-house resource for tax planning and preparation.

While a fractional CFO engagement doesn’t give you a full-time CFO, it does give you full-time access to one. A fractional CFO’s work is done online, which means you always have access to your real-time financial information. Outsourced CFO solutions are typically provided for a set monthly fee, so you won’t experience billing surprises.

Best of all, a fractional CFO gives you talent you can rely on for the long term. You won’t have to worry about your CFO leaving your firm for a better job.

The right KPIs and industry expertise

Paying attention to key performance indicators, or KPIs, can be a powerful way to drive value—if you’re paying attention to the right KPIs, that is. A fractional CFO who knows the financial services industry can quickly identify which KPIs are critical to your RIA firm’s performance. These may include your firm’s direct expenses, cost to acquire new accounts, and growth and retention rates, to name a few. Your fractional CFO will monitor these KPIs, so you can stay focused on growing your business.

A fractional CFO who specializes in the financial services industry can offer insight into what other similar firms are doing, too. You can use a fractional CFO as your sounding board, knowing this professional is familiar with the types of issues you face.

A one-stop shop for tax planning and preparation

As I mentioned earlier, a fractional CFO can help you with tax planning and preparation, too, making tax time more convenient. Think of a fractional CFO as someone who provides full-time accountant outsourced services. And because a fractional CFO is tracking your firm’s numbers on a monthly basis, you won’t have to worry about last-minute adjustments or last minute tax planning crunches.

Accountability for your firm’s financial success

Your fractional CFO will review your firm’s financials after each month-end close and pull out the important things for you. You can count on your fractional CFO to review these custom reports with you, and to make sure you understand the numbers. In other words, your fractional CFO is your in-house financial resource and educator.

Your RIA firm doesn’t have to go it alone.

Managing your firm’s financials can be a substantial undertaking if you’re trying to do it on your own. At Elevate, we provide outsourced CFO solutions solely for registered investment advisor firms. Our team offers fractional CFO support that can be scaled up or down as needed and multiple levels of expertise. If you’d like to begin the new year with fewer financial worries on your plate, we’re here to help. Questions for your RIA firm? Contact us today.

 

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