Pros and Cons of a Tax Accountant Doing CFO Work
The advantages and disadvantages of a tax accountant are like an outsourced CFO with just one additional each for pros and cons entries.
Pros:
#1 They May Also Cost You Less
Tax accountants are cheaper because the time and cost might be capped or agreed upon already, making the investment lower compared to an external CFO.
#2 They May Be More Motivated to Work Better
Like outsourced CFOs, tax accountants should be motivated because you can easily no longer use their services if they’re not giving you value or performing well.
#3 They Have Broad Experiences
Similar again to an outsourced CFO, a tax accountant can boast of multiple experiences. They have worked with other businesses and other industries, and they can apply the insights they learned from these experiences to your business.
#4 They Are Already Familiar with Your Business
The additional advantage of a tax accountant is that they already know you. They already know your structure and understand how your business is set-up which can have a big benefit in terms of who you share your information with.
Cons:
#1 Internal Push May Not Be There
Like outsourced CFOs, the internal push might not be there because tax accountants are an external worker. They are not there all the time and are not as easily accessible to your team, unlike an internal CFO. A tax accountant may only visit your office once a month, or once every quarter or work case once a year.
If you're trying to build an initiative, with the help of your tax accountant, it's a lot easier for your people within the business to ignore and not feel like they're being held accountable. And to be frank, just forget what was being done.
#2 They Are Also Not as Familiar with Industry Lingo
Like an outsourced CFO, a tax accountant may not be as familiar with your industry lingo, although, financial information is consistent in nature.
#3 Same Feeling of Being on the Clock
Like outsourced CFOs, you will have constraints consulting or even having a simple discussion about work and business with tax accountants beyond the hours you are billing them for.
#4 Less Specialised Than Internal and External CFOs
The additional con for tax accountants is the fact that CFO is a very specialist-oriented field. Both outsourced CFOs and internal CFOs devote their life's work in terms of building expertise on financial management and financial performance. Tax accountants by name spend a lot of time looking at tax, and we've found with tax accounting offerings is they are often quite high-level. You will get a report and a management meeting, but tax accountants won’t necessarily work as intensively in your business in the same way an internal and external CFO would. Especially in terms of the day-to-day operations of your business as you try to bring projects to life. This may be a compromise when availing the services of a tax accountant.
