Outsourced CFO vs Accountant: What’s the Difference?

August 16th, 2016 by Justin Sadler

One of the most common questions we’re asked at Sadler Accounting is about the differences & similarities between a standard accountant and an outsourced CFO. People tend to be far more familiar with the job of an accountant, and they generally know what a CFO’s role is at a large company, but they aren’t sure what an outsourced CFO has to offer.

If the question is “what’s the difference between an accountant and an outsourced CFO,” then the answer is pretty simple. They aren’t completely different. All outsourced CFOs are accountants, but not all accountants can act as outsourced CFOs. An outsourced CFO is an accountant who goes the extra mile to know your business, advise important financial decisions, and act as an advocate to the government on your behalf. So, in terms of what they can offer a company, it’s not that accountants offer one set of skills, and the CFO offers a different set of skills. Rather, they do the same tasks to a certain point, and then the outsourced CFO keeps working for you. The easiest way to visualize this is to break down the basic tasks that small businesses lean on both accountants and outsourced CFOs for, and what the CFO does that an accountant does not.

The Benefit of Either an Accountant or Outsourced CFO

Record Keeping

This is one of the core, base-level tasks that businesses look to accountants to accomplish. As businesses grow, so do their financial books. Most business owners aren’t trained in accounting, and the need for astute record management becomes very overt. This is where an accountant steps in and makes sure the necessary records are being kept, and being kept accurately.

Timely Payment to IRS

Every year, thousands of business owners fall behind in their business taxes because they are simply too overwhelmed and under-informed to handle them accurately. The fear of the IRS, and specifically the fear of an audit, can be absolutely paralyzing, and is one of the most frequent pain points that lead to an accountant being hired in the first place. There’s a reason that accountants are so busy during tax season. Any accountant worth their salt will make sure the IRS is paid accurately and on time.

Handling Past Due Payments Beginning to Stack

Oftentimes, business owners decide to reach out to an accountant when they’re falling critically behind in their taxes and IRS payments. Accountants then swoop in, pick up where the business owner left off, and put them back on track to on-time payments.

The key takeaway here is that accountants generally come in and fix problems that exist, or take over tasks that the business owner no longer has time to do. In that way, accountants by nature are reactive. Conversely, outsourced CFOs are reactive when they need to be, but operate as a proactive partner to a business. The following are a short list of what CFOs offer that standard accountants don’t.

What Makes the Outsourced CFO Different

Forecasting and Vision Casting

As a true partner, we get to know your business from the inside out. When we call ourselves your outsourced CFO, we mean it. We are able to meet with partners regularly to not just react to how the business is doing but actually plan for spending proactively into the future. In our opinion, it’s impossible to measure business success without goal setting forecasting. Standard bean-counting accountants simply don’t have time and don’t know their client’s business well enough to achieve helpful forecasting.

Acting as Trusted Liaison to the IRS

This is THE critical differentiator. As an outsourced CFO, we represent your business when you need to communicate to the government. For example, when taxes and finances need to be filed. So many business owners don’t know the right questions to ask when tax season hits, and with the rules & regulations of the IRS how could they? With our wealth of knowledge and experience, we know exactly what needs to be prepared and asked in order to continue to build your business into an even more prosperous future.

At Sadler Accounting, we’re passionate about being the proactive financial guide that every small business needs. Our hands-on approach is born out of a genuine desire to help small business owners succeed in a challenging marketplace made more challenging by complex tax rules and regulations. We firmly believe that the outsourced CFO model of business accountant is what’s best for you, and encourage you to reach out to us as soon as possible so we can forecast your financial future, and address concerns that plague the present.