In Pursuit of Profit
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A guest post from Jen Girard at CFO Selections
We get this request all the time. A small non-profit needs to hire a new Finance Manager. Sometimes they call this person a CFO or Controller, but whatever the title, the role is a Superhero who wears multiple costumes and does it all!
How do you find (and afford) this person? Find out how other non-profits are doing it:
A Superhero’s Job
A Superhero’s job runs the gamut of financial activities.
First, they must grab the green eye shades for the day-to-day hands on bookkeeping – everything from invoicing funding sources to paying all the vendors and employees.
Then they grab their calculator to check their math and reconcile accounts, including the bank statements. They need to make sure the auditors are happy and get everything they need. And, of course they are responsible for basic financial statements as well and the integrity of the data contained within them.
Now, this is not to say that a Superhero is perfect! Even a Superhero makes mistakes, and you need to be prepared for that. Having one person setting up vendors, issuing checks, and reconciling cash is not a great scenario for any organization! I know, we need to trust people, and I’m not saying that embezzlement will happen, but it scary how often it happens. And even when fraud isn’t occurring, mistakes can (and do!) still happen. At a minimum, we cannot expect even a Superhero to be mistake-free. We all make mistakes, and it’s really hard to catch our own mistakes. Having some level of internal controls, like segregation of duties or checks and balances is necessary to support this caped Superhero.
But that’s not all! They must grab their cape to leap tall buildings including negotiations with the bank, insurance providers, and health benefits companies. They also need to build models and forecasts, possibly alongside HR and IT to add even more variety into the mix.
Does it sound daunting to imagine finding someone to meet all these needs? If you said yes, you’re not alone!
What is a Small Non-Profit to do?
First off, don’t panic. Take the opportunity to slow down and step back to evaluate your options.
Step 1 – Assess the Situation
Figure out what you really need in the way of accounting and finance to support the organization. Ask yourself the following questions:
Doing a financial assessment is a great way to answer these questions, and more!
There are different ways to do a financial assessment. You might have a Board Treasurer with an accounting background who can help, or you can bring in a consultant. Whatever you do, make sure it’s thorough and will provide enough detail to help inform your hiring decisions.
Step 2 – Determine Budget
What is your budget? How much can you earmark for accounting and finance? Remember to calculate the total dollars that your organization can spend on human capital in finance/accounting.
Step 3 – Consider your Options
Let’s assume you have a budget of $100,000. You can certainly post the job online for a full-time Finance Manager Superhero and see what you get. (A client of ours posted such a role and did not get a single qualified, or even close to qualified, candidate for 12 months. Eventually, they understood that they had to get more creative.) Or you can break apart the duties into more than one position or person! Yes, Eureka!
Finding a Superhero
It’s no secret that right now there’s a Great Resignation occurring. It is tough to find anyone right now let alone a superhero.
Gone are the days of paying $85,000. The average salary range for a Finance Manager is $109,000 - $137,000 these days. Those are just average numbers too, which means if you are looking for someone with extra skills in their toolkit, you’ll likely need to pay more than that. (Oh, and Controllers and CFOs made significantly more than Finance Managers!)
Then, even if you get lucky and get some candidates who are qualified, you are competing with for-profit entities, which typically have bigger budgets to work with. And soon it’s a David and Goliath battle.
A Different Solution (A Smarter Way to Use Your Dollars)
Here is a typical pyramid of accounting/finance needs:
Instead of trying to hire one Superhero to do it all, consider breaking up those needs in the following way:
I have seen this strategy of breaking up the role into two positions work on numerous occasions!
When a nonprofit organization hires a fractional financial leadership role, they get the accounting leadership they are looking for without needing to spend the big dollars on bringing in a full-time hire. Like an a la carte option, they just pay for the time they need to for this individual to complete more senior-level projects (like managing month and year-end close, overseeing lower level accountants, and preparing financial statements) instead of having the carrying costs of base salary, payroll taxes, and a benefits package. This not only reduces their overall costs, but also converts a fixed expense into a variable expense that can be scaled up or down as business needs dictate.
As a result, the organization frees up money in the budget to be able to hire a full-time accountant to do ongoing work like handling AR and AP, booking journal entries, and supporting grant work.
And the best part? They can actually find the right candidates to do these two distinct roles because they had the savvy to break them up, so they are no longer looking for a single unicorn hire that likely will never come!
Finding Hiring Help
Remember, even when you split the role, you do not have to go it alone when it comes to hiring. Working with a finance and accounting recruiting firm is the best way to find qualified candidates for your needs. They can recommend the best ways to break up the role and draw upon their professional networks to find candidates that meet your nonprofit organization’s requirements.
Whether you are looking for a part-time financial controller or full-time staff accountant, we can help! Let our experienced recruiters find the right fit for your budget. Contact us today!
About the Author
Partner, Business Development Director - CFO Selections
Jen Girard has more than 25 years of professional services experience focused primarily in consulting, client service, engagement management, and talent acquisition. She has served clients ranging from startups to those in extensive growth stages, and those experiencing M&A transactions. Her industry focus has included technology, real estate, construction, transportation, manufacturing, and distribution.
At CFO Selections, Jen’s role is focused on helping businesses succeed and grow by matching each company’s unique financial needs with the right resource and solutions.