As your company grows, it becomes increasingly important to find competent financial leadership that will help you navigate the competitive Canadian market.
However, not every small- or medium-sized business has the resources to hire such experts on a full-time basis, given that CFOs command an average annual salary of around $142,764 in Canada and about $167,949 in the US.
This is where fractional CFO companies step in. They provide much-needed access to executive-level expertise on strategic financial planning at a fraction of the cost of hiring a full-time employee.
In this article, we shall highlight the best fractional CFO companies in the Canadian market and cover essential qualities a trusted CFO should exhibit. We’ll also discuss how to choose the right CFO services partner and the signs your business needs a fractional CFO.
TL;DR – Best Fractional CFO Companies
Short on time?
Here is a list of seven Canada-based fractional CFO companies to consider:
- JS CPA Strategic Solutions
- Fractional CFO Canada
- FractionCFO
- CFO Sense
- ProLedger
- UHY Forbes Andersen
- saascfo.ca
Let’s learn the services each company offers.
Essential Qualities of a Trusted Fractional CFO Provider
Hiring a fractional CFO services provider can flip your company’s operational dynamics.
However, given the scope of services a fractional CFO can provide, it is vital to find one that suits your needs and understands your expectations.
Below are some of the essential qualities to look for in a fractional CFO provider:
- Industry Expertise: Choose a service provider with a deep understanding of key financial principles beyond just bookkeeping and reporting. They should understand Generally Accepted Accounting Principles (US GAAP), International Financial Reporting Standards (IFRS), Accounting Standards for Private Enterprises(ASPE), tax laws, and cash flow management, among others.
- Excellent Communication: Any CFO you hire should be able to explain complex financial information in simple terms that all stakeholders in your business can understand, regardless of whether they have a finance background or not. The CFO should also be transparent, especially when sharing difficult information such as the financial risks and challenges surrounding your business.
- Strong and Strategic Leadership Skills: A fractional CFO should lead by example by undertaking tasks that seem daunting, such as formulating forward-looking strategies and financial planning. They should also be willing to mentor your internal finance team and encourage collaboration among finance personnel to improve your company’s financial competencies.
- Scalability and Adaptability: A fractional CFO services provider should be able to scale support to your business as your needs evolve. This is especially crucial for startups and growing small and medium-sized enterprises that face constantly shifting business environments and need to pivot strategies regularly.
- Relevant Industry Experience: In addition to industry expertise, a fractional CFO provider should have experience working with other businesses in your industry, or at least cross-sector experience. This means they can provide tailored guidance that acknowledges sector-specific dynamics and risks, regulatory requirements, and niches your business can exploit to grow.
- Cultural Fit: A fractional CFO should understand and internalize your company’s objectives, vision, and culture before you start working together. This ensures they can provide guidance you can trust and that aligns with your values. They should also integrate seamlessly into your company and demonstrate genuine concern for its operations.
7 Best Fractional CFO Companies to Hire
With the qualities in mind, let’s now highlight the top fractional CFO providers available to Canadian businesses.
1. JS CPA Strategic Solutions
JS CPA Strategic Solutions stands apart as a CPA-led firm based in Toronto. We provide fractional CFO services in addition to M&A advisory and tax and compliance services across Canada and the US.
Our firm emphasizes a hands-on approach when conducting a comprehensive review of your finances. We create a strategic plan that aligns your financial plans with your company’s long-term goals.
Our presence extends throughout Canada and the US, making it ideal for SMEs looking to scale their operations across the border, prepare for an external investment or acquisition, or seek CFO insights into strategic expansion.
Book a discovery call today and accelerate your company’s growth while preparing for exit.
2. Fractional CFO Canada
Fractional CFO Canada is a financial management services provider that offers daily operational support, including bookkeeping, as well as more comprehensive services such as financial reporting and inventory management.
The company helps small- and medium-sized businesses looking for simple solutions to minor issues, to more complex solutions.
However, the company’s general approach to financial services means it lacks a strategic approach for cross-border tax planning and exit readiness.
3. FractionCFO
FractionCFO is a service provider focused on strategic, insight-driven support. They primarily help businesses streamline working capital, manage cash flow, and plan strategically.
It helps business owners focus on strategy development rather than on day-to-day operations.
However, the firm’s small size may hinder its ability to manage several clients simultaneously.
4. CFO Sense
CFO Sense is an Ontario-based fractional CFO services provider that leverages its founder’s 30 years of experience in finance to help businesses understand their financial figures, achieve profitability, and create strategic plans.
The company also offers entrepreneurial operating system (EOS) integration services that enable companies to align their financial operations with software solutions that improve operational efficiencies.
However, the company’s regional focus on Ontario excludes companies in other Canadian provinces from accessing their services.
5. ProLedger
ProLedger is a fractional CFO services provider that integrates technological solutions into its core services. The company leverages cloud accounting tools to deliver secure, real-time data to its clients, enabling them to make informed decisions.
It helps small- and medium-sized companies seeking modern, tech-oriented solutions to meet their emerging financial needs.
However, the company has a regional focus, primarily operating in Ontario, which can be a dealbreaker for businesses with operations all over Canada.
6. UHY Forbes Andersen
UHY Forbes Andersen is an accounting and M&A advisory firm that also offers fractional CFO services.
They help fast-growing or larger medium-sized companies step away from boutique CFO services and seek institutional expertise.
However, working with a larger firm may dilute the personalized interactions between a client and a service provider that are characteristic of boutique fractional CFO services. In addition, larger firms tend to charge more for their services.
7. saascfo.ca
saascfo.ca is a fractional CFO services provider focused on supporting business-to-business (B2B) software-as-a-service (SaaS) companies.
They help companies secure external funding while also providing key startup support, including legal, marketing, and bookkeeping expertise.
However, the company’s focus on tech startups and SaaS companies may make it an unsuitable solution provider for companies in other industries.
How to Choose the Right CFO Services for Your Business
To choose the right fractional CFO services, you have to understand why you need their services to make an informed decision.
Here are factors you should consider in the process:
- Define your Objectives: Assess your financial needs before hiring a fractional CFO. Do you need help planning a merger or acquisition, developing strategic plans for the future, tax planning, or improving operational efficiency? Once you define these objectives, you will be able to find a service provider with the appropriate expertise to meet your needs.
- Your Budget: Evaluate how much you can afford to spend on outsourcing CFO services. Then compare the pricing options provided by each service provider and decide whether an hourly rate or a permanent retainer is more appropriate. You should also evaluate the long-term costs and not primarily focus on short-term low costs.
- Assess Industry Fit: Different fractional CFO services specialize in different sectors. You need to find a service provider with experience working specifically with other businesses in your industry. This ensures they can address any industry-specific needs or issues you are experiencing.
- Check References: Before hiring a service provider, request them to share testimonials and case studies from previous clients. You can also check service review sites to get a bearing of what their previous clients had to say about their services. This is one of the best indicators of whether the service you chose is the right fit for your business.
- Evaluate their Competencies: Begin by evaluating their communication skills. The service provider should provide regular updates and explain all pertinent matters in detail and in a comprehensible manner. They should also be heavily invested in financial software such as QuickBooks and data analytics tools that will help them evaluate your financial data more efficiently.
- Clarify Deliverables: Sit down with each service provider you are considering and discuss what they would consider a success for your business. Then evaluate the KPIs and understand their processes before making a final choice.
Signs Your Business Is Ready for a Fractional CFO
As a business owner, you may find it challenging to take the leap and bring in an external party to help with your financial planning and strategies.
However, there are circumstances under which outsourcing your financial needs might be necessary, such as:
- Fast-paced Growth: If your business is experiencing rapid growth, you need to adjust to the new normal quickly before it overwhelms your systems. For example, if you were managing hundreds of thousands of dollars in revenue and then found yourself making millions, your existing financial processes, such as bookkeeping, may be inadequate, which is why you need CFO services.
- Weak or Inconsistent Cash Flow: If your bank balances are constantly fluctuating, thereby affecting your ability to meet financial obligations, such as payroll and inventory, you need to hire a professional. They will help you streamline cash flow forecasting, thus allowing you to maintain sufficient cash reserves for expenses and opportunities.
- Prepping for a Complex Financial Decision: It would be wise to hire someone with executive-level financial expertise. They will help you navigate the complex negotiation, strategic planning, and due diligence in Canada to get you the best deal possible.
- Correcting Errors: If your internal finance team is consistently submitting inaccurate or late financial reports, it is an indicator that they are overwhelmed by the tasks, and you may need someone more experienced. A fractional CFO will streamline the reporting processes and identify your team’s weaknesses to help with their training.
- You Do Not Understand Your Financial Reports: When you lack a finance background, it may be challenging to interpret the information on financial reports. This eventually affects your ability to make competent decisions. Having a fractional CFO will help you understand all the information in your reports, thereby elevating your decision-making and allowing you to focus on other areas of the business.
Where JS CPA Fits in Your Fractional CFO Strategy
While the firms on our list focus on areas like operational bookkeeping, JS CPA Strategic Solutions stands apart for its service integration:
- We integrate fractional CFO services with other services, including exit planning, M&A advisory, and tax restructuring.
- Our Growth Mosaic Strategy offers a comprehensive growth-focused approach to enable US and Canadian founders planning to scale, acquire, or exit in 3 to 5 years.
- Our comprehensive review unearths any hidden financial challenges that may hamper your long-term plans, enabling us to develop mitigation strategies that protect your future.
- We ensure affordability and personalized attention, giving you real-time access to vital data.
Book a consultation today and get tailored financial insights that help you when making key growth decisions.
Frequently Asked Questions (FAQs)
Below are some answers to common queries we receive from our clients:
What Does a Fractional CFO Do?
A fractional CFO provides strategic financial leadership to businesses on a part-time basis.
They focus on issues such as financial planning, risk management, financial reporting, cash flow management, and forecasting, among others, to support economic growth.
How Long Do Businesses Typically Use Fractional CFO Services?
Businesses often hire fractional CFO services for durations that vary significantly based on their needs and growth phase.
The duration can range from a few months for short-term projects to ongoing support for long-term projects and objectives.
Which Businesses Benefit Most From Fractional CFO Services?
Fractional CFO services primarily benefit startups, SMEs, and high-growth companies that can leverage their cost-effectiveness, as they cannot justify an in-house CFO.
They help such businesses with fundraising, establishing scalable financial systems, and compliance.
Do I Need a Fractional CFO If I Have an Accountant?
Yes, you do need a fractional CFO even if you have an accountant. This is because accountants primarily focus on historical data and compliance matters.
On the other hand, a CFO will provide insight into your company’s future by helping with risk mitigation, forecasting market dynamics, and providing strategic planning and financial modeling.