Fractional finance director or full-time finance director? How to choose

Joe Gilbert ACMA CGMA
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 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 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 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.

Talk to us about finance director support