Before you hire a CFO, figure out how much CFO work you really have. If it’s one or two days a week, a fractional CFO gives you the same expertise for a fraction of the cost. Past about three days a week, or if you want someone in the office every day, hire full time. Then define the job, look for experience in your industry, and test candidates on your own numbers.
Signs it’s time to hire a CFO
- You only learn how a job did when it’s finished.
- You’re profitable on paper but always short of cash.
- Your bank or surety is asking for reports, covenant calculations or a WIP schedule.
- Your accounting staff makes the same mistakes every month, or doesn’t have the bandwidth.
- You’re planning to grow, take on bigger work, refinance or sell.
- You keep losing finance people and starting over.
CFO, controller or bookkeeper?
Titles get mixed up. Job ads ask for a bookkeeper and then describe CFO work, or the other way around. Here’s the difference:
- Bookkeeper: records transactions, pays bills and sends invoices.
- Controller: runs the accounting, closes the books each month and produces accurate reports.
- CFO: uses those reports to plan cash, financing, growth and risk, and works with your bank, surety and owners.
Many growing companies need a strong controller before they need a CFO. Read more in CFO vs. controller.
Fractional or full-time: four questions
- Do you want someone on site every day? Some owners want to walk over and get an answer the moment a question comes up. If that’s you, hire full time.
- How many days a week of work is there? Past about three days a week, a fractional CFO usually costs about the same as, or more than, a full-time hire.
- Have you outgrown part-time help? As companies grow, the work can outgrow a fractional CFO. That’s a good problem to have.
- What happens if your CFO leaves? Construction finance roles see a lot of turnover. Some companies that hire full time keep a fractional CFO as an advisor and second set of eyes, so someone always knows the numbers.
| Role | Typical cost |
|---|---|
| Full-time CFO, New York market | $200,000 to $250,000 a year |
| Full-time controller, New York market | $175,000 to $200,000 a year |
| Fractional CFO or controller | A flat monthly fee for the days you need |
Staying on after you hire a CFO
Sometimes a client grows to the point where a full-time CFO makes sense. When that happens, some keep us on in an advisory role after the hire: a second set of eyes on the numbers, and a backstop if the new CFO leaves. If you’re not an accountant yourself, that outside view can catch things your team handles differently than it should.
How to hire a full-time CFO
- Write down the work, not just the title. List the reports, deadlines, bank and surety requirements, and the staff the CFO will manage. That tells you whether you need a CFO or a controller.
- Look for industry experience. In construction, a CFO should know the WIP schedule, job costing, percentage of completion, retainage and bonding.
- Use more than one source. Executive search firms, your CPA, your banker and surety agent, and your own network.
- Test candidates on your own numbers. Ask them to walk through a recent WIP schedule or financial statement and tell you what they’d look at first.
- Check references on the work, not just the person. Ask what the candidate built and what improved.
- Plan for turnover. Document the monthly close and reports, so a departure doesn’t send you back to square one.
How we help
Not sure whether you need a full-time CFO? Start with a free review of your books, and we’ll tell you how much CFO work you really have. See our fractional CFO services for contractors, outsourced controller services, our guide to what a fractional CFO is, and how we work.
FAQs
When should a company hire a CFO?
When cash is tight despite profits, when your bank or surety needs more reporting, when you’re planning growth or a sale, or when your accounting team needs senior oversight.
How much does a full-time CFO cost?
In the New York market, about $200,000 to $250,000 a year. A full-time controller costs about $175,000 to $200,000.
Should I hire a fractional or full-time CFO?
Fractional if the work is one or two days a week. Full time if it’s more than about three days a week, or if you want someone on site every day.
What’s the difference between a CFO and a controller?
A controller runs the accounting and produces accurate reports. A CFO uses those reports to plan cash, financing and growth.
Can I keep a fractional CFO after hiring a full-time one?
Yes. Some companies keep a fractional CFO as an advisor and second set of eyes, which also protects against turnover.
