The finance team of today looks incredibly different than its counterparts did five years ago. Modern CFOs and other finance leaders are expected to play a much more active strategic role in their companies than they once did.
Just as significantly, finance, RevOps, and accounting teams are using automation to help them achieve more and become more profitable while using fewer resources.
This article will examine the ins and outs of the SaaS finance team: how can it be optimized for the present moment but also future-proofed? And how can accounting departments use technology to achieve these important goals?
What does a SaaS finance team do?
A SaaS finance team is a group of individuals responsible for overseeing the accounting department of a software company. Some of the team’s most important tasks include:
- Tracking and improving KPIs: Metrics offer a vital sense of direction for startups. Without KPIs, it would be impossible to track which business decisions were working or whether companies were on track to hit their revenue targets. SaaS finance teams are responsible for using metrics to fuel their company’s profits.
- Ensuring the company scales optimally: If startups aren’t careful, they can end up scaling faster than their existing corporate infrastructure will reasonably allow. This problem can be eliminated through automation, which will get rid of manual accounting bottlenecks.
- Handling compliance and taxes: More and more red tape is being introduced into the finance sector, making full compliance much more difficult to achieve. Your finance team will keep your company on the right side of ASC 606 and other regulations.
- Putting the right billing architecture in place: Software companies are known for their multiple billing options, and your accounting department is responsible for finding the best one for your product. Automated forecasts will enable you to remove 100% of the guesswork from your billing strategy.
Now let’s examine the four central roles of a finance department.
How do you set up a finance team?
To create the most effective finance team possible, it’s important to know the roles you’ll be hiring. Here are some basics about the four primary positions in a SaaS accounting department:
- Controller: The controller is the individual on the finance team who’s responsible for overseeing, executing, and reporting on the day-to-day accounting events at the company. Your controller will be able to update you on the details of corporate budgets, hiring capital, and much more.
- CFO: In contrast to the controller, the CFO of a finance team is tasked with bigger-picture strategic optimization. They’re responsible for using forecasting and other tools to lead the company to the best possible pricing decisions, hiring calls, product rollouts, and more. Rather than being entirely replaced by automation, CFOs are called on to use automation to lead their companies forward.
- Accountant: Your accountant will help your company and other finance team members with corporate taxes and compliance. These days, SaaS finance teams frequently outsource this role to automated cloud-based software, which can do everything an accountant can and much more.
- Bookkeeper: Bookkeepers oversee all recordkeeping responsibilities for the finance team and the company. Like accountants, bookkeepers on modern SaaS finance teams are often replaced with an automated accounting suite to reduce manual errors and maximize efficiency.
Let’s move on to a few tips about the actual process of hiring your finance team.
Tips for hiring a future-proof finance team
Future-proofing your finance team is about combining the unique strengths of human beings and machines. The accounting department of the future–and, increasingly, the present–is a hybrid of human intuition and automation.
Assembling the perfect accounting department means starting with the right hiring philosophy:
- Digital outsourcing: As we alluded to above, the rapid advances in accounting technology have enabled software to outperform human employees on finance teams across multiple dimensions. Software is better than humans at data centralization and organization, making accurate long-range forecasts, revenue reporting, and many other accounting tasks.
- Stop rushing into new hires: Beyond its stellar performance on accounting tasks, automated software can help you hire your finance team more effectively through detailed hiring forecasts. This will help you better gauge what you can afford to spend on each role and precisely what results you expect from each as well.
- Optimize cash flow to maximize hiring resources: Automation can help lower your DSO so you get paid more quickly on each transaction. A faster cash flow cycle frees up more capital for building your finance team.
Automated software can help you make better hiring decisions upfront, and then it can seamlessly become a valuable “member of the team” itself. Future-proofing your finance team is largely a matter of properly and effectively striking this balance between humans and software.
Don’t leave building the right finance team to chance
Your finance team is one of the most critical components of your company. Luckily, you don’t have to leave constructing a winning accounting department to chance.
Click here to learn even more about what makes for a future-proof finance team–and more specifically, a future-proof CFO.
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