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Do You Need a CPA or VCFO for Your Business?

Do You Need a CPA or VCFO for Your Business?

Making sound financial decisions are crucial to the success of any size company. A financial professional will help you understand and chart strategies to help you manage a profitable company, but for many, there may be confusion regarding the respective services of a Certified Public Accountant (CPA) or a virtual Chief Financial Officer (VCFO). 

What your business needs will determine what level of financial professional you need. To clear the air, the virtual CFOs at Gonzalez & Arrambide want to discuss the differences between all of these roles so that you can get the most benefit for your business.

The Differences Between a CPA and a VCFO

A moderate sized company with revenue ranging from $2 million to $20 million may have senior executives rely on the advice of their CPA for matters involving certain business finances. In these instances, the CPA will offer a financial opinion based on experience with taxes and tax law, rather than offering insight related to long-term financial advice for the business.

The responsibilities of a VCFO go beyond tax advice and basic accounting. In a nutshell, a VCFO helps with business planning, forecasting, negotiating, and business budgeting, all of the same kind of responsibilities a company Chief Financial Officer (CFO) would do. A VCFO, on the other hand, saves a company money because they aren’t paying for a full-time employee with benefits.

It’s important to note that you don’t need to be a CPA to be a VCFO, and CPA’s aren’t always well-versed on managing complex corporate finances that a VCFO can.

Let’s elaborate a little bit on these roles now.

More Into the Role of the CPA

In the simplest of terms, the CPA is in the business of tax return preparation; that is their primary responsibility. A CPA may collaborate with a VCFO to provide tax advice that will ultimately help guide the company’s financial decisions based on short term and long-term objectives. 

The CPA’s knowledge revolves around taxes and tax laws that lend to the strategies that may be developed by an outsourced CFO. Often, a company may mistakenly look to a CPA for business advice that may be best handled by an individual with a background as a VCFO. A CPA will help a company thrive by performing a range of duties including: 

  • Organizing and updating accounting records
  • Staying abreast of tax laws 
  • Tax preparation and analyzing reports on transactions
  • Conducting regular, detailed audits 
  • Manage financial documents, expenditures, and investments

Consider a VCFO to Help You Strategize While Saving Money

When evaluating the financial goals and objectives of a company, an outsourced CFO will bring strategies and insight that a CPA may not be equipped to handle. A qualified and experienced VCFO will focus on future cash flow and offer expert advice on operational planning to ensure a company is sustainable. In addition, a company may choose to hire a VCFO in order to:

  • Chart a financial strategy
  • Forecast growth
  • Outline sustainability by addressing expenses and highlighting assets
  • Improve profitability 
  • Control expenses and cash flow
  • Establish strong financial relationships
  • Assess financial risk
  • Finance project management 
  • Liaison shareholder relationships

Ultimately, a business may decide to hire a CPA, a VCFO, or both based on a range of factors exclusive to your company’s needs. Whether you’re a growing business or an established company, hiring the right team can make all the difference in your financial outlook.

The Virtual CFOs at Gonzalez & Arrambide Offer Trusted and Sound Service

Founded in 1996, Gonzalez & Arrambide, Inc. has become a respected and recognized accounting firm dedicated to helping individuals and businesses of all sizes with their business needs and strategy. Our commitment to services ensures we give you what you need to succeed and grow your revenue streams. 

At Gonzalez & Arrambide, we offer our clients Virtual Chief Financial Officer (VCFO) services and have helped them improve financial management without spending the substantial resources needed to hire someone in a full-time role. 

Serving the entire Rio Grande Valley Greater Metro and located in Weslaco, our VCFOs are more than qualified to meet your business needs.

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