Do I need a finance director, or is my accountant enough?
It is a fair question. You already pay an accountant, the accounts get filed and the tax gets paid. Why would a care business need a finance director as well?
The short answer is that they do different jobs. Most care businesses need both. The question is whether you need the second one yet.
Your accountant looks back
A good accountant makes sure your year-end accounts are right, your tax returns are filed on time, and you stay on the right side of HMRC and Companies House. Many also run payroll or do the bookkeeping. That work is essential, and a finance director does not replace it.
But it mostly looks backwards. The year-end accounts tell you what happened, often months after it happened.
A finance director looks forward
A finance director's job is to help you run the business from here:
| Your accountant | A finance director |
|---|---|
| Year-end accounts and tax | Monthly figures you can act on |
| What happened last year | What is likely to happen next month |
| Compliance | Decisions: fees, staffing, growth, borrowing |
| The bank balance today | A cash forecast for the months ahead |
| Your tax position | Your case for the council, the bank or a buyer |
A finance director works alongside your accountant, not instead of them. In practice, the accountant's job often gets easier, because the monthly figures are already in good order.
Signs you might need one
You probably don't need a finance director if the business is small, stable and you are comfortable with the numbers. You probably do if several of these sound familiar:
- You only find out how you did when the year-end accounts arrive
- You are topping up payroll from your own money, or close to it
- Fee reviews feel like guesswork
- Agency spend or staff costs are rising and you can't say exactly why
- The bank, an investor or a buyer is asking for figures you can't produce
- You are planning to open another home or service, or to sell
- One person holds all the finances together, and you'd be stuck without them
Why part-time
A full-time finance director typically costs £70,000 to £110,000 a year in salary, before employer's National Insurance, pension, bonus and recruitment fees. Most independent care businesses don't need one five days a week.
A part-time finance director gives you the same experience for the days your business needs it, for a fixed monthly fee and without an employment contract.
If you're not sure whether it's worth it for your business, book a call and Danny will tell you honestly. Or see how Danny helps care businesses.