Small businesses that have just begun don’t often have their own financial department because they’re too young for that sort of thing. Normally it's the entrepreneur or the leader that handles the finances and they just about get on. However when you have a growing number of employees as well as a wider reach in the market, you need to take the act of financial planning much more seriously. Therefore dedicating a department to this is going to help you cover all the areas that you need to, in order to keep a firm track of everything involving money. But where do you begin? A financial department is interlinked with all the other departments much like how the research and development department operates. You should be careful as to not make the department too big or too small, you need to make quality decisions over quantity.
Control your credit
Just like you have a credit score when you go to a bank, a business too will be judged by its credit score. This is for when you want to borrow money to invest in your business. Banks and business loan companies need to know that you are trustworthy and will give them a return on the money they have loaned you. This obviously means you need to hire a Chief Financial Officer. They will be leading the entire department with the sole goal of not just making your business look good on the credit score sheet, but giving you the best chance of funding future projects. The CFO is only second to the CEO, so this is a major hiring that you will be doing. Do some research for the kinds of things you will need to look for in this kind of person. Make sure you know their history and what kind of reputation they have left behind themselves in their previous role.
Tools to succeed
The financial employees will need some of the best software out there to do their tasks. So buy professional accounting software which allows you to do multiple things relevant to the business as a whole. For example, the financial organization of the company as well as planning. Managing your finances at all levels, auditing them as the projects go along, controlling spending and finally accounting for everything altogether. From one base, this allows your employees to communicate with every department and keep track of how much they are spending of their allocated amount of funds. You’ll also be able to see if the money has been wisely spent by using the auditing features.
Advised hiring
Together with your CFO, you need to sit down and discuss the amount of employees that will be needed for your business in this particular department of course. They will know how many right hands they need to make their role easier and more thorough. Financial planners and advisors will be the bulk of hirings but risk assessment employees and managers will also have their place.
The finances of a business are perhaps the most important thing. Without them you cannot function but keeping them in order is very difficult. Hence why hiring an excellent CFO is your first and only priority for creating your financial department.
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