What support does my business need?
Part-time finance director
A part-time finance director gives a business senior finance help for a set number of days a month, without employing a full-time finance director.
The short answer
A part-time finance director (often called a fractional FD) works with your business for a set number of days a month. They help you prepare forecasts and budgets, assess funding options and work out whether the business can afford new staff or equipment. Your accountant often still does the accounts and tax. Businesses may benefit from one when they are growing fast, borrowing, raising money or getting ready to sell.
What they do
- Build and update a cash flow forecast and a budget.
- Explain the monthly figures and what to do about them.
- Prepare for talks with banks, lenders and investors.
- Help with pricing, hiring plans and big purchases.
- Set up the finance processes and controls the business needs as it grows.
- Help get the business ready to sell or to buy another one.
How it differs from an accountant
The line between the two is not fixed. Many accountants also provide management accounts, forecasts and advice. The table shows the usual difference in focus.
| Accountant | Part-time finance director | |
|---|---|---|
| Usual focus | Accounts and tax, often with advice and sometimes monthly figures | Plans, budgets, funding and finance decisions |
| How often | Varies, from a few times a year to monthly | Usually a set number of days each month |
| Typical work | Annual accounts, tax returns, VAT, payroll | Forecasts, budgets, funding, board meetings |
Some accountancy firms offer both. Others work alongside a separate finance director.
When a business may benefit from one
- It is growing quickly and cash is tight.
- A lender or investor wants forecasts and regular reporting.
- The owner decides on hiring or big purchases without a clear view of the numbers.
- It is planning to raise money, buy a business or sell.
- It is too small for a full-time finance director but has outgrown yearly accounts alone.
What it costs
We have not found a reliable published source for what part-time finance directors charge in the UK, so we do not give a figure. The cost depends on the number of days a month and how complex the business is. Ask for a day rate and an estimate of days before you agree anything.
Questions to ask before you hire one
- How many days a month do you think we need, and why?
- Have you worked with businesses of our size and in our sector?
- Do you hold a professional accountancy qualification?
- How will you work with our current accountant?
- What will we have after three months that we do not have now?
A part-time finance director is one option, and not always the first. Better monthly figures from your accountant, or a management accountant, may be enough. See also Accountant or part-time finance director?