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With an outsourced CFO function, one size fits all

Business

Businesses from fast-growing tech start-ups to multinationals spreading their wings increasingly turn to external finance teams, says Grant Thornton specialist.

By Philip King 10 minute read

Businesses from technology start-ups to large multinationals increasingly turn to outsourced CFO services for a range of expertise seldom found in one individual, says Grant Thornton national managing partner Michael Pittendrigh.

He said access to a pool of experts – in the case of Grant Thornton’s CFO service, about 50 across Australia – trumped someone working solo while in many cases, the talent shortage meant finding anyone suitable was a challenge.

“There’s just a lack of quality CFOs in the marketplace and I think we’re seeing that for all finance functions,” he said. “It’s been challenging time to access people over the last two or three years so I see a lot of clients who are reaching out to say, we need support, we can’t attract the right type of person.”

“The list of things they want them to do is so extensive you’re going to find that one person.”

Compliance demands simply compounded the problem.

“Regulation, governance, compliance is just getting more and more complex. Organisations are thinking through how they manage this.”

“So we’re getting much more inquiry around, can you support us through change? And dial this up, dial it down as we need it?”

He said outsourced CFO services were more agile and cost-effective than in-house staff, either as the complete answer to handling a company’s finance needs or, in the case of larger businesses, a specialised supplement to a team.

Typical clients ranged from fast-growing technology firms to businesses restructuring to multinationals spreading their wings.

“We’re having a lot of success with new clients. Foreign subsidiaries is [sic] a classic one where it works well – you’re sitting on the other side of the world and yet selling your work to Australia and building a team. To know that you’ve got a reputable firm that’s looking out for the finance functions is important.”

“We’re also seeing a number of technology-style clients who are coming on board for the reason they want to scale up, they don’t want to invest too heavily or it’s too early to invest in a more senior person themselves.”

Controlling costs was also a motivation for retailers and wholesalers, while professional services companies often wanted access to specialised skills.

“Professional services is one of those areas that are asking for a higher level of service than a traditional CFO can provide,” Mr Pittendrigh said.

“They’re looking for that higher level of thinking which they can access at the time they need – as well somebody who can do more of the ongoing maintenance of the finance function.”

“Our access to people is much greater than an individual organisation which is just looking for a very specific skill, very specific person, that they’re trying to bring on board.”

Grant Thornton’s outsourced CFO service also aimed to offer strategic vision.

“We want to make sure we can add insights, we can add opportunities that we’re seeing across the broader market about how to invest into the client to help them build and grow.”

Suitable staff at Grant Thornton needed strong tax and technical skills, the ability to build and present information, perform as part of a client’s team and build effective relationships. Automating and offshoring some of the tasks helped keep costs down for the client.

“With the ability to scale up or scale down depending on your business’s needs, leveraging an outsourced CFO services model gives you access to resources and qualified employees who are across the latest developments in tax and accounting.

“An outsourced CFO brings together the breadth and depth of skillsets and expertise, acting as an extension of your own team to complement your existing finance function.”

 

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Philip King

Philip King

AUTHOR

Philip King is editor of Accountants Daily and SMSF Adviser, the leading sources of news, insight, and educational content for professionals in the accounting and SMSF sectors.

Philip joined the titles in March 2022 and brings extensive experience from a variety of roles at The Australian national broadsheet daily, most recently as motoring editor. His background also takes in spells on diverse consumer and trade magazines.

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