Bridging the gap
Background
A growing business had reached the stage where their financial needs were outgrowing the small finance team. The finance team was experienced in what had previously been sufficient but it was clear that they would benefit from some strategic guidance, reporting support, and some tighter financial control.
The business had grown to a turnover of £3m in the last few years but they weren’t yet at the point where bearing the cost of employing a full time Finance Director, (FD), or Financial Controller, (FC) was required. There was a need to bridge the gap between the finance team’s day-to-day function and board-level financial leadership in a cost-effective way.
Our Approach
Our initial task was to identify the key finance challenges faced by this business and how we could help resolve them. In this case, the main challenge lay in not having any senior finance staff within the business to bridge the growing gap between the finance function and the Directors. This is common.
We needed to understand how the team worked together and how systems and processes were used for their tasks. We also needed to determine whether the board already thought knew what they wanted from the finance team, together with the gaps in both knowledge and information that needed to be filled.
We quickly established that we could split the requirements into the Fractional Financial Controller (FFC) and the Fractional Finance Director (FFD) roles. This would enable part-time support to be flexed as needed.
Actions Taken
We needed to become part of the extended team, with a good understanding of both finance and operations. To achieve this, we put on different hats to look at the business from both Financial Controller (FC) and Finance Director (FD) perspectives.
From an FC perspective, we reviewed how the team worked together, understood their strengths and weaknesses and how they used the processes and systems available to them. We sat down with the team both individually and as a whole and documented the flow of sales, purchases, banking and reconciliation. We found that whilst there was accurate and efficient transactional performance, insights and relevant reports were lacking.
We approached a strategic review from the viewpoint of the FD, determining what information was useful to the Board and identifying gaps. This revealed a need for timely monthly reporting with supplementary information, cashflow management and financial strategy to enable sustainable growth.
The reviews enabled us to implement a range of solutions including:
Weekly team calls to offer guidance and advice, including cashflow forecasts
Monthly finance reviews with the team
Quarterly strategy sessions
Annual budgeting
Analysis on the current performance and what this meant for the months ahead.
Outcomes
The Board are now empowered to make decisions based on robust financial information and have increased confidence from having backup support as needed. There is now a tight grip on cashflow and an understanding of the drivers behind this.
The Board know the accounts are processed in a controlled manner and in compliance with regulations. They know their business benefits from an in-house team that is underpinned by a wealth of experience from their Fractional counterparts.
Why choose Porterdale to become part of your extended team?
Taking the Fractional route, usually a couple of days a month, gives your business the best of both worlds. Your business can benefit from an FD who provides strategic oversight, funding support and long-term financial planning at a high level, and an FC who ensures accurate reporting, robust processes and financial discipline. This dual approach strengthens the finance function, without the cost of full-time employees or the addition of a full-time member of staff. We meet you and your business where it is now, supporting your growth as a trusted extension to your team.
For more details please contact us.
Words by Lindsey Owen
Bridge header photo by Chuttersnap