No matter what size company you operate in China, if it is a start up or a long-established firm, the help of a financial professional could mean the difference between failure and success. The assistance of a virtual CFO can provide peace of mind by assisting you to better guide your company’s sustainable financial performance.
An experienced virtual CFO can offer expertise, local knowledge, and objectivity to guide your company through financial management at a fraction of the cost of an internal hire.
Doing business in China is fiercely competitive and having a financial strategy has become crucial for companies to maintain a good advantage.
However, many firms either lack the experience, expertise, or capital for this or find themselves attempting to balance all aspects of a business, subsequently hindering growth. The utilization of outsourced CFO services could provide the necessary guidance and oversight of all financial aspects of the company.
A Chief Financial Officer (CFO) is the senior executive responsible for managing the finances of the company. Their duties include financial planning, tracking cash flow, and analyzing the financial status of the corporation. Their responsibilities are similar to that of a controller or treasurer, but with the added responsibility of overseeing the overall income and expenses of the organization.
A virtual CFO, also known as an outsourced CFO, offers the same expertise as a traditional CFO, however the main difference is that it is a part-time service. Under this format, a company can benefit from having a clear strategy and better direction, without paying a full-time CFO salary.
Especially in the start-up economy, where financial advice is crucial to business success, but funds are limited, the popularity of virtual CFO services has been growing dramatically.
A virtual CFO is a good choice for small to medium companies struggling to balance the day-to-day demands of a business, leaving little time to work on the bigger picture and assess growth opportunities and strategic planning.
Entrepreneurs often try to juggle all aspects of a business, which can sometimes end up being inefficient and time consuming. Whether you find yourself compromising your business’s everyday function, or its growth opportunities, both can be harmful and might be a sign that your business could benefit from outsourced financial services.
A virtual CFO frees you to be able to allocate more of your time in your area of expertise and provides a set of fresh financial eyes to help make informed strategic forecasts and decisions.
When a company is struggling, a virtual CFO can bring the skills to improve its financial health, specially creating a three-to-five-year financial plan, delivering monthly consolidated reporting for reliable decision making, assessing when and how much future capital should be raised, and understanding key financial metrics for the industry.
Business growth comes attached to higher risk. A virtual CFO can develop the financial tools needed to scale up and ensure that the financial infrastructure is fit for purpose, determining the most cost-effective tax structure, among others.
The knowledge and expertise of an outsourced CFO is essential in understanding how your business can achieve success, and how strategies can be executed in the most effective way.
In China, the constantly changing market dynamics require quick adaptability. A virtual CFO can help identify opportunities and present business cases that will help the company capitalize on the ongoing changes in market demand, as well as assess when it is time to expand or release new products to acquire maximum profits.
Another circumstance when you could benefit from a virtual CFO is when your business is preparing for a merger or acquisition, and you need to perform the necessary financial and regulatory due diligence. A CFO can do this for you to make sure that transactions run smoothly.
The Chinese taxation system can be complex and overwhelming for any foreign company. A virtual CFO with local experience can help analyze the tax benefits of investments, improve your tax position, maximize corporate tax benefits, and ensure compliance with tax rules to avoid penalties.
Doing business in China means you should be able to communicate in Mandarin Chinese and Cantonese. Employing CFO services in China ensures you are given an experienced CFO who is proficient in the language.
Your business may require outsourced CFO services at any stage of its life cycle. Whether it be to facilitate a short-term capital raise, or long-term growth. Regardless of your business’s unique financial position, a virtual CFO will be a knowledgeable guide, saving you both time and money.
Just like the CEO, the role of a CFO is vital to a company’s success. If your plan is to establish a successful business in China but do not have the budget for a full time CFO, a good alternative would be to outsource this service.
To learn more about our services in China, contact our Head of Business Advisory - Ms. Kristina Koehler-Coluccia at firstname.lastname@example.org. DISCLAIMER: All information in this article is verified to the best of our ability and is assumed to be correct at time of release; however, Woodburn Accountants & Advisors does not accept responsibility for any losses arising from reliance on the information provided within. The information provided is for general guidance and does not replace specialized advice.