You’ve likely heard of the benefits of outsourced accounting services and how they can eliminate the challenges of an in-house accounting team. In fact, 78% of businesses all over the world feel positive about their outsourcing partners. However, it’s important for business owners to know that Finance-as-a-Service (FaaS) is slightly different from an outsourced accounting team. Outsourced accounting can serve as more of a generalized term that describes any number of services that respond primarily to bookkeeping or compliance issues.
Finance-as-a-Service, on the other hand, provides access to a team who responds to the core functions and strategic initiatives of your business. Using these professionals, you can clearly communicate directives across your organization and ensure your entire company stays on the same page regarding specific procedures and operations.
If you’re concerned about the financial direction of your company, Fully Accountable’s Finance-as-a-Service team can help. Through integrated software management, business intelligence, data analytics, benchmark KPIs, and real-time reporting, we can ensure your company stays on track for its financial goals. Continue reading to learn more about the benefits of Finance-as-a-Service.
How Can Finance as a Service Companies Help?
FaaS teams combine financial strategy and accounting in one department. They promote continuity within the organization and give you access to a full-service accounting team without the hassle of hiring and retaining an in-house team. Finance-as-a-Service teams are different from outsourced accounting teams, in part, because they look at your internal operations, offer scalable solutions, and can integrate with any existing software while recommending new solutions.
These factors are what gives FaaS teams more agility. They are fractionalized and can respond to the needs of your business regardless of your industry. They can also clearly communicate insights and directives with your entire team, including C-suite executives.
How Can You Decide Whether FaaS Is Right for Your Company?
Before committing to a FaaS company, you should consider the size, needs, team resources, and direction of your company. Let’s take a look at how the FaaS model fits within various organizations.
Startups and SMBs- FaaS and outsourced accounting for startups are perfect for companies with basic accounting needs who are looking for manageable scaling. The FaaS model will give them flexibility and an easily adaptable solution as they grow. They will be able to add resources to their department and eventually incorporate strategic CFO initiatives. On top of that, they will be able to automate simple bookkeeping and compliance processes while producing actionable data sets.
Scaled and Growth Companies- For companies with higher transaction volumes, they may require more complete financial resources. FaaS gives them access to experts who can develop a more hands-on approach to their financial success. The outsourced accounting team will be able to collaborate with your company’s existing tax advisory team and CPA. You will also be able to add additional resources that serve as turnkey solutions for an in-house CFO.
Established Startups- Lastly, if you already have a successful in-house team of financial experts, an FaaS team can add a strategic CFO to your team to work closely with your board, investors, and C-suite executives. A strategic CFO can guide the company’s overall financial strategy during critical times. Additionally, because they are fractional, you will be able to use them for specific purposes,establishing a scalable solution.
What Are the Benefits of Finance-as-a-Service?
The core benefits of a Finance-as-a-Service company include:
- Cost benefits
- Scalable solutions
- Specialized directives from a strategic CFO
- Increased synergy among departments
- Optimized business procedures
- Prioritized growth
Cost Benefits
Choosing an FaaS solution instead of a full service, in-house accounting team can save you costs. The cost savings don’t only occur upfront. Rather, they last over the long haul. These cost savings last because over time you can increase the amount of procedures you automate, respond to challenges faster with a more agile approach, and provide data analysis that leads to more confident decision making and reduced risks. Lastly, a FaaS team will be able to streamline your financial reporting.
A company with an in-house team but without a CFO will produce reports designed for compliance. A company with access to a CFO has data in their hands that leads to more forward-thinking insights. FaaS providers give companies access to numerous analytics and metrics that help the company leverage enterprise-level finance and accounting software for better reporting in easily understood terms.
Scalability
Finance-as-a-Service providers give you the benefit of agility and freedom so that your business can use their services as needed. They provide the tools to set up systems without the overhead or commitment of an in-house team. These fractionalized professionals will already have experience in your industry and your company will be able to scale easily and effectively.
CFO Support
If your company lacks a CFO, you can use one provided by your FaaS company. Strategic CFOs, such as the ones at Fully Accountable can give your company the financial guidance that leads to long-term success and a strategy that fits with your evolving needs. Having an outsourced CFO will give you financial leadership and allow you to focus on your core business principles. They will be able to guide you on how to create a strategy that fits with your goals.
Increased Synergy Among Departments
FaaS companies consolidate all of your financial data into easily-discernible systems. The old way of keeping records on paper and various spreadsheets increases the chances for errors and it’s also time-consuming, which equates to lost productivity and profits. FaaS models show companies financial reports and unify the ways companies read those reports. Having a clearly unified method to analyze data ensures the entire company is on the same page regarding the directives going forward. Having everyone on the same page regarding your financial data gives you the following benefits:
- Company-wide understanding of profitability and cash flow
- Clearly related performance to investors
- Easier fraud and errors detection
- Improved accuracy of your business forecasts, predictions, and directives
- Mitigated risk and less indecision surrounding business decisions.
FaaS companies improve your financial management guidance and connect your data so your company can mitigate risks and build a long-term financial strategy. This long-term strategy gives you an overarching view of how each financial initiative affects the company as a whole. If your financial data is disjointed and teams can’t collaboratively manage that data, there won’t be enough synergy within departments to create clear objectives.
Optimized Business Procedures
Business procedures are at the heart of your financial directives and strategy. If the various departments don’t have clearly defined procedures that help them understand the company’s overall financial strategy, you won’t be able to realize all of the benefits of an FaaS company. FaaS teams implement the correct procedures for each department to minimize costs and ensure every team member is on the same page regarding financial objectives.
What Do FaaS Companies Help You Avoid?
An effective FaaS team helps you avoid the following pitfalls common for an in-house team:
- Lack of software and resources needed to produce data-driven reports
- Lack of time and strategic expertise to produce long-lasting directives
- Lack of expertise needed to set up company-wide systems.
- The role of a CFO split time between compliance and strategy because of lack of automation and software.
Creating and optimizing a financial system takes time and resources. With an in-house system, you need to respond to the problem by creating a solution, configuring it, implementing it, and training the in-house team. With a FaaS team, you have the benefit of an existing, plug-and-play system.
Reduce Fraud
Growing businesses try to improve productivity and control, but their systems often leave room for human error. Human error can increase the chances of fraud and lead to other issues. FaaS companies protect all of your company data by implementing the most advanced security software. They also eliminate the risk of human error by automating the correct data input actions.
In short, these companies consolidate your data and give you data autonomy. In turn, this consolidation expedites your collections and reduces the chance of fraud.
Prioritized Growth
Perhaps most importantly, having a FaaS team on your side lets you focus on the core principles of your business. It also gives you the data you need to make informed decisions. Having a strategic CFO on your team provides access to a professional who works with you on your company’s financial objectives and identifies opportunities you might not recognize.
Bottom Line
The benefits of outsourced accounting have long been recognized by companies trying to automate some of their bookkeeping and compliance processes. However, Finance-as-a-Service takes these benefits one step further. They do this by automating the correct analytics, implementing software, providing a scalable solution, and clearly communicating objectives across your organization.
At Fully Accountable, we believe businesses of all sizes can benefit from our FaaS offerings. Whether you’re a small company struggling to scale or an established company who stands on the precipice of a high stakes game of growth and needs clearly defined financial strategies, we have a fractionalized team that can help.
Contact us today to learn more about how you can benefit from the FaaS team at Fully Accountable. Sustainable growth is only a phone call away.
