Fractional finance director or full-time finance director? How to choose
If your business has outgrown a bookkeeper and a year-end accountant, there are three common routes: hire a full-time finance director, bring in a fractional (part-time) finance director, or stay with an accountant and add more support around them. This guide compares them so you can decide which fits your stage.
The three options at a glance
Fractional finance director | Full-time finance director | Accountant and bookkeeper only | |
|---|---|---|---|
Main focus | Forecasting, funding, planning and board-level finance | Everything finance, every day | Compliance: bookkeeping, accounts, tax |
Time commitment | Set days or a regular monthly commitment | Full-time employee | As needed for filings and queries |
How you pay | Agreed fixed fee or set number of days | Salary plus employment costs | Fees for the work done |
Looks forward? | Yes | Yes | Mostly looks back |
Best for | Growing businesses that need senior input without a full-time role | Larger businesses with enough finance work to fill the role | Simple businesses with stable needs |
When a fractional finance director fits
- You are growing faster than your finance setup and need forecasts and decisions, not just year-end accounts.
- You are raising investment or borrowing and need credible numbers and someone who can answer investors' questions.
- You want reliable monthly [management accounts](/management-accounts-explained) with commentary, so you can price, hire and spend with confidence.
- Something has changed, such as an acquisition, a new site, a cash squeeze or a key person leaving, and you need experienced input quickly.
When a full-time finance director fits
A full-time hire makes sense when the business generates enough finance work, such as a larger team, multiple entities or heavy reporting, to keep a senior person busy every day, and you want that person embedded in the leadership team. The cost is a salary and employment costs whether the workload is high or low, and recruitment takes time.
When an accountant alone is enough
If your needs are mainly bookkeeping, VAT, payroll, year-end accounts and tax, and you are not planning a fundraise or a big change, a good accountant and bookkeeper may be all you need. The gap appears when you need forward-looking advice during the year, not only compliance afterwards. Our guide on [what a finance function is](/what-is-a-finance-function) explains the difference.
Questions to ask before you decide
- How many days a month of senior finance work do we really need?
- Is the main need forecasting and funding, or day-to-day control and reporting?
- Do we want someone in the team every day, or a regular, scheduled input?
- Will the need grow quickly or settle?
- Can the support be scaled up around a fundraise and back down afterwards?
How Elm works
Our [fractional finance director](/fractional-finance-director) service is agreed on a fixed monthly fee or a set number of days, so you know the cost before we start. We scale the support up around a fundraise or a big decision and down when things settle. If you reach the point where a full-time finance director is right, we will say so and help with the handover. We can also provide bookkeeping, payroll and compliance as part of a complete [outsourced finance function](/finance-function).