For business to grow and mature, it is necessary to opt for the services of an accounts outsourcing firm or a “Virtual CFO “, ( VCFO ) to simplify fatuous processes. One of the most common questions raised regarding this is the dissimilarities and similarities between accounts outsourcing and VCFO services.
They both provide similar services in terms of finance. However, a VCFO service usually goes an extra mile knowing your business, taking care of end to end financial matters and providing financial analyses along with strategic business inputs. Albeit, Accounts Outsourcing and VCFO Services, both are considered efficient ways to save money and time of the organization, these services differ from each other in the following ways:
Difference between Accounts Outsourcing and VCFO Services
1.Better expertise-
Accounts outsourcing firms provide services like handling bookkeeping, accounting and other simple functionsthat tend to focus only on current results. Whereas, a VCFO provides with better strategiesfor the same processesi.e. pursuing long term benefits. In other words, a Virtual CFO is an all rounder who provides you with knowledge that is outside the domain of accounts outsourcing firm.
A VCFO will therefore guide you through financial planning, developing of strategies, analyzing developed strategies, obtaining resources,maintaining resources and advocating government on your behalf which will in turn be helpful for you in long term planning for your company in addition to the services offered by an accounts outsourcing firm.
2.Forward Thinking-
Accounting outsourcing firms tell you where your finances are lacking by providing you with daily, monthly or quarterly reports. Whereas, VCFO analyses such reports and makes long term action plans through financial planning, fundraising andby providing with tips& tricks to know how and where to invest to get maximum returns.
3.Business growth-
Business has various dimensions and it is not possible to handle all of them efficiently at all times. A VCFO, therefore, makes a business aware of all the possible threats and opportunities coming its way through his experience and vast knowledge of business by working on a budget planning , budgeting, costing analysis, policy making etc. for the business which give an overview of all the possible problems coming its way. Whereas, an accounts outsourcing firm provides help only with audit, data analysis and implementing basic policies.
4.Consultation benefits-
Every company needs accounts outsourcing to perform traditional services which are of great importance in day to day routine but apart from that it requires ideas and suggestions to provide value beyond compliance benefits. A VCFO, therefore, not only helps in tax planning but also guides on key tax practices and streamlining it to their benefit.
Therefore, outsourcing accounting services give guidance on all technical matters relating to finance and a Virtual CFO gives a deep analysis on finance, tips on latest trends and technological advancements.