When You Need an Interim CFO

one man leading another while hiking to illustrate how interim CFO leads financial team
An interim CFO leads your financial team when your current CFO leaves or is unable to.

There are many reasons why you may need an interim CFO for your business. Interim professionals help bridge gaps when your current CFO leaves, takes extended leave, or does not have the experience needed for your current financial situation. In this article, we’ll discuss interim chief financial officer services and how to find the right professionals for your needs.

What Does an Interim CFO Do?

To understand what an interim CFO does, it’s important to understand what a CFO is. The chief financial officer (CFO) is an executive in charge of a business’ financial goals and financial team. These professionals manage your company’s financial situation through many means, like overseeing bookkeeping and accounting teams, managing capital structure, and deciding when and where to invest the company’s money. They are primarily concerned with optimizing reporting, liquidity, and return on investment for financial performance. In many smaller companies, they may also act as the financial controller for the business.

More than these important skills, the CFO also offers leadership for the financial team and collaborates with other executives to help steer the business toward success. CFOs are responsible for the company’s financial health. They may also perform many other tasks that improve a company’s financial health, such as negotiating with suppliers and vendors.

An interim CFO is a professional that steps in, typically on a full-time basis, for a short period of time. Usually, an interim CFO stays on for weeks or months to fill gaps from the current CFO.  The interim CFO can train with the outgoing CFO prior to their departure, if possible, then handle the role while a permanent replacement is identified.  And once the new individual is onboard, the interim CFO can train the new CFO to ensure a seamless transition.

When to Hire an Interim CFO?

There are any number of reasons to hire interim professionals to provide CFO services. A consultation with our team can help you determine whether you need an interim CFO or another financial advisory service from our seasoned experts. However, here are some top reasons your business may need interim chief financial officer services.

Permanent CFO Leaves the Organization

If your current CFO leaves your company, then it can be helpful to have an interim professional fill in until a new one can be hired. An interim chief financial officer can take over in case your current CFO is taking a new position, retiring, or even if you had to terminate them. This way you still have someone at the helm of your financial team after your CFO leaves. This is incredibly beneficial because finding the right new hire can be difficult. An interim professional gives you breathing room to find someone who will be the right fit for the permanent position.

Extended Leaves of Absence for Your CFO

In some cases, your CFO may need to step away from their duties and return to them at a later date. Some common examples include extended vacations, long-term sick leave, or parental leave. In this situation, your CFO will return after a predetermined time. However, you may need someone to perform key duties while they’re away. That is where an interim professional can step in to help guide your company and oversee your financial situation.

Gaps in Experience

Another common reason you may choose interim CFO services is if your current CFO lacks experience to handle a specific situation. For instance, if your company faces a financial crisis that your current CFO isn’t confident that they can navigate successfully, you might consider bringing on extra help temporarily. An interim CFO can offer additional support, experience, and a fresh pair of eyes to help you weather the storm.

What’s the Difference Between Interim CFO and Fractional CFO Services?

It’s a common misconception that interim and fractional CFO services are the same thing. However, there are some key differences between an interim and fractional CFO. One may suit your needs better than the other if you’re looking for a CFO.

An interim chief financial officer performs CFO duties, often full-time, on a temporary basis. Typically, there is some catalyst such as your current CFO leaving. For example, termination, extended absences, or even a financial crisis that causes you to seek an interim professional.

A fractional CFO, by contrast, offers long-term support on a part-time basis. With fractional CFO services, you work with our firm to determine how much time you need for CFO services on an ongoing basis. This can be a few hours a month or several hours a week to help your company grow. It’s common for startups and small businesses to choose fractional services to help strategize and oversee growth, as often smaller businesses don’t need a full-time CFO on staff. Also known as on-demand CFO services, these are the perfect option for businesses who need some continuing help from a financial expert.

What to Look for in an Interim CFO?

An interim CFO must have many hard and soft skills to adequately fill the role. If your business needs an interim chief financial officer, it’s critical to find professionals that are up to the task. First and foremost, it’s essential to look for professionals that have knowledge and experience with CFO tasks and duties. After all, an interim professional often must fill in and get acclimated quickly, so you want someone with plenty of experience behind them to help with this and to help them provide the highest level of service for your company’s continued success.

Also, it’s necessary to look for a professional that has outstanding communication skills. The interim CFO must communicate with many different people to effectively manage the company’s finances. For instance, they must communicate goals and tasks to the financial team, such as accountants and bookkeepers. They must also discuss key information with the board and other executives for strategizing and decision-making.

How Do Interim CFO Services Work?

Every company is different, so there is no one-size-fits-all solution for interim CFO services. Our team is here to design our interim services to suit your specific needs. However, in general we may recommend preparing by having our professionals train with your current CFO when able. This allows us to understand your current financial situation, processes, and systems before we take over as acting CFO. While this step isn’t necessary, it can be helpful when your CFO stays on for a transitionary period, such as if they are headed for retirement or another position.

Once the current CFO leaves, our professional fills their shoes for you on a temporary basis. We perform all the daily duties as the previous CFO and also work toward the goals we identified with you during the consultation. While we step in to manage your company’s financial health, this gives you plenty of time to find the right new hire if applicable. We can help with recruiting and interviewing if needed to help you find your new permanent CFO. Then, we’ll stay on to provide training and create a smooth transition between your interim CFO and your new permanent CFO. We are dedicated to serving you and doing everything we can to help your business continue to succeed and grow.

Sabre Financial Group – Your Source for Financial Consulting

At Sabre Financial Group, we are dedicated to your company’s financial success. We are your trusted source for financial advisory and consulting for a wide range of situations, from start up business consulting to planning your exit strategy. Our team offers decades of experience to help you weather any storm and plan for long-term growth. Contact us now to schedule a consultation with our experienced professionals.

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