You don’t have to search very hard online to find advertisements from firms of accountants offering fractional finance director services explaining how they work with CEOs/business owners to maximise growth etc. However this recent unflattering Linkedin post by Tim Meadows-Smith dated 28/02/26 explains reality –
One CEO to another:
Finance Directors and chips belong together.
Both arrive wrapped in yesterday’s news.
The chips in a newspaper.
The Finance Director in a board pack full of last month’s numbers.
The difference is you know the chips are cold.
The things you actually need are to understand what is happening now and how to influence what happens next.
If that feels hidden from you, it is usually because you are asking the wrong questions of the wrong role.
You receive accounting analysis when what you need is business analysis.
The Finance Director is the right person to safeguard cash and produce accurate accounts. They are trained in control and compliance. They are rarely trained in operations, performance drivers, or business analysis.
Your role as CEO is to create the environment in which performance becomes inevitable. That requires business intelligence, not retrospective explanation.
Recognising the difference is a mark of leadership maturity.
It’s Friday. Fish ‘n’ chips anyone?
My Response
Before proceeding further I believe Tim Meadows-Smith is explaining the role of a Financial Controller, very much a business defender ensuring tax and legislative compliance together with accurate historical reporting – never strategic but a firm base for a finance director/CEO to start their projections.
There is however very much more of a risk for smaller businesses which do not require a full time finance director but need more than just their year end accounts. Often at this point in their business journey, owners realise the need and either reach out to a business coach or to their external accountants who both claim they can assist.
Business Coach scenario
The business coaches love an ambitious business owner and will encourage them to put together a three to five year business and personal plan based on their dreams.
The coach then sets regular goals, however nobody is looking at whether there is sufficient cash available to fund the targets or checking the actual profitability of the new business.
12 months later the business either folds due to a lack of cash, else their external accountants are employed to assist in mopping up the mess. This often includes having spent up to a six figure sum for this ‘advice’.
External High Street Accountants Scenario
As the preparer of their year end accounts and tax returns these are often the obvious first choice of professional which quite rightly the SME business owner speaks. Unfortunately most High Street accountants believe they have the skills to assist – which in theory is correct however they lack practical experience of ever properly working in a business (at best sitting in a closed door board room, whilst carrying out an audit), meaning anything offered is theoretic and very much leaning towards historic analysis rather than working beside the CEO, providing the financial case for chasing new contracts together with their impact to EBITDA and the cash position.
Result – the business stumbles on with some improved reporting, possibly monthly management accounts which report line of business profitability and a 12-month forecast, however lacking the spontaneity to spot opportunities, and asking the questions that drive real decisions such as –
- What’s the expected cash balance in 90 days?
- What is the profitability by product line and does it cover overheads?
- Which parts of the business is actually making money?
- Can we afford to recruit— and when?
If nobody in a business is asking those questions, they are flying blind.
Solution
Recruit either a full or part time (fractional) industry trained finance director. Having obtained their financial experience whilst working in a business means they have a greater chance to properly identify drivers of performance and instinctively to understand and to analyse operations. Typically 90% of their work is forward looking – typically using monthly management accounts which split income streams by profitability as a base.
Typically the best finance directors are business leaders which just happen to also be in charge of finance. They are strategic thinkers who are able to identify opportunities together with adding financial confidence to board proposals.
Practice accountants struggle with finance director positions because of the vast difference in the skillset required to carry out the position. Whilst many practice accountants are highly technical they struggle with the ‘big picture’ business strategy together with the company board leadership skills required of a finance director position.
Here is a summary of the key reasons why this transition can be challenging
Reactive, backward looking Perspective
Practice trained accountants are mainly focused on historic data – compliance, tax returns or in auditing its accuracy.
For an FD it is essential they are forward looking – whether this is modelling future performance or anticipating future business needs. Practice accountants often struggle with this falling back to prioritising analysing the past.
Lack of a Commercial Mindset
Cost v Value – practice accountants are trained to be risk adverse and to focus on cost cutting
Commercial Reality – A successful FD acts as a business partner understanding how to drive revenue, increase value and to support growth – not just how to manage expenses.
Weak Operational and Strategic Focus
Technical v Operational – as a consequence of the only true business work experience being audit related visits, practice accountants generally lack experience in operational management such as supply chain, human resources or marketing – so critical to a CEO’s strategic vision.
Over-reliance on Numbers – Practice accountants tend to become too involved in technical accounting details and fail to look at the ‘big business picture’.
Limited Leadership and Communication Skills
Communication Gaps – Practice accountants are often weak in translating complex financial data into actionable insights for non-financial employees – which is so key for effective leadership.
‘Policing’ Mindset – instead of aiming to develop and empower the wider organisation some accountants will focus too much on enforcing strict, bureaucratic procedures.
Risk-Averse Nature
Caution – due to practice training being very much focused on preventing errors and fraud, they can be overly conservative so hindering growth in high paced or entrepreneurial businesses.
Lower Strategic Impact – Research suggests accountants with a strict auditing background may not be effective in high-growth industries which require bold, strategic investments.
Differences Summary
| Aspect | Practice Accountant | Finance Director (Industry) |
| Focus | Past, historic and compliance | Future, strategic and proactive |
| Viewpoint | Technical and detail-orientated | Commercial and strategic |
| Role | Cost-centre management | Revenue and value generation |
| Approach | Risk averse | Risk Managed/calculated risk |
While these are common challenges it is possible for a practice accountant to succeed as a finance director/CFO if they are able to develop a commercial mindset, improve communication and to shift their focus from compliance to business growth.
