22

Client Relations • Disclosures • May/June

 B
usiness owners need more help than
ever to manage cash flow and budget
expenses, and 68 percent say they
are looking to their accounting and financial
partners to provide this help, according to
an informal SunTrust survey of business
owners.
So, how does becoming a “Virtual CFO”
help CPAs play an even more vital role to
clients?
A Virtual CFO uses technology to extend
value to clients through knowledge, helping
expand the CPA’s role as trusted advisor.

A Virtual CFO uses technology to

extend value to clients through
knowledge, helping expand the
CPA’s role as trusted advisor.

The broad adoption of online banking

and electronic payments brings an increased
flow of electronic payment information.
CPAs can leverage this data to help clients
map a cash-flow strategy, assemble detailed
budgets and financial statements and moni-
tor progress on-site or remotely.
Additionally, through deep knowledge of
a client’s business and careful research into
Using Payments their payments-related practices, a Virtual
CFO can provide recommendations to help
and Banking Technology address priority business issues such as im-
proved cash flow and reduced expenses.
Forward-looking CPAs can help their
to Increase Value to Clients business clients use technologies to im-
prove processes and reduce resource com-
mitments. By educating clients about the
benefits of implementing paperless financial
systems and electronic payment systems,
By Deborah Matz CPAs can empower business managers w

Client Relations • Disclosures • May/June 23

with better control over cash flow, budgets
and profitability.
With many small businesses looking for
more help, CPAs have ample opportunity
to help boost clients’ profitability and busi-
ness efficiencies.
The following strategies provide a basic
foundation for CPAs to begin or continue
their transformation into Virtual CFOs.
Communicate the
importance of a
“payment strategy”
A solid payment strategy addresses the
methods and costs involved in accepting and
disbursing payments while also protecting
sensitive company and customer informa-
tion. CPAs should address the importance of
this critical plan and explain how it takes into
account customer and vendor preferences,
as well as practical business needs such as
timely funds access and more efficient busi-
ness processes.
With payment options comes increased
customer convenience, which is why more
and more business owners have adapted
their systems to accept more payment types.
24 Client Relations • Disclosures • May/June
Twenty-six percent of business owners
added the customer choice of electronic or
card payments in the last 12 months, ac-
cording to an informal SunTrust survey of
business owners.
However, while convenience in payment
acceptance is important, not all businesses
should offer all payment types. CPAs should
help clients track customer purchasing
behavior to evaluate the best customized
payments strategy and ultimately decide
which payment forms to accept.
CPAs need to review evolving payment
technologies with clients and develop a
strategy that helps improve collections,
streamline disbursements and meets chang-
ing customer and vendor preferences.
Many small businesses still run a “cash-
only” operation, but consumers and busi-
nesses alike continue to move toward
electronic payments. Debit and credit card
acceptance is becoming a consumer expecta-
tion, but card acceptance is also becoming
increasingly important in business-to-
business commerce. Many companies and
government institutions rely on purchasing
or corporate cards to reduce the costs of
working with vendors. In order to accept
their payments, businesses need to be able
to accept the cards.
According to First Data’s January 2010
SpendTrend report, overall same-store
electronic transaction growth increased 7.9
percent compared to January 2009. CPAs
need to advise small business clients about
the importance of accepting multiple forms
of payments, from debit cards to paper
checks in order to offer customers the full
range of preferred payment choices.
In addition to offering customers conve-
nience, electronic payment capabilities can
have an impact on collections by allowing a
business to accept a check or card payment
over the phone from late-paying customers
rather than waiting for a customer to drop
a check in the mail.
Finally, by helping clients create a solid
payment strategy, CPAs can increase the
amount of detailed information available
to support financial analysis and process
improvement. This helps Virtual CFOs
work with clients to streamline business
operations and improve cash flow.
Maximize cash flow
Similar to staying physically fit, staying
financially fit requires constant attention
and upkeep. CPAs can look for new ways to
keep clients’ cash flow “in shape” by utiliz-
ing simple strategies and technologies that
provide clients and CPAs with a streamlined
system that delivers better results.
CPAs should start by getting the appro-
priate level of access to clients’ accounts,
and then advise them about online bank-
ing features that can support the financial
reporting system and business decisions.
Most small business owners use some on-
line banking tools, but they may not access
all of the appropriate features. With a few
clicks of a mouse, CPAs and their clients
can have access to features that allow them
to send Automated Clearing House (ACH)
payments, detect potentially fraudulent
transactions and download information into
common business software programs.
Active client use of online banking and
access to financial information by the CPA is
an important step in a Virtual CFO strategy.
This tiered access allows a CPA to serve
clients more efficiently, more often and
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Client Relations • Disclosures • May/June 25
from almost anywhere in the world. It also
provides the appropriate level of control and
security by allowing CPAs to help automate,
manage and track cash flow, budgets and
profitability while clients maintain control
of spending approval or check-writing.
Another important cash flow tactic is
helping clients set up procedures to analyze
and control expenditures. For example,
providing designated employees with ac-
cess to a company credit card can improve
expense tracking and limit or restrict
spending, in turn helping the business have
more control over expenditures and cash
forecasting.
As a Virtual CFO with strong informa-
tion access, CPAs can help business owners
reinforce financial discipline. While most
business owners create budgets, they don’t
always refer back to them each month and
take note of variances. A Virtual CFO
should encourage clients to use electronic
reporting options to set monthly limits and
goals to help improve cash flow versus rely-
ing solely on a yearly or quarterly budget
exercise.
On the reporting front, a Virtual CFO
Top financial talent
is always your best
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can use electronic information to create sys-
tems that automatically compile a monthly
“flash” financial report from electronic
financial data to help evaluate clients’ busi-
ness performance. This data can be used as
part of regular meetings or teleconferences
to review performance against targets for
budgeting expenses, generating sales or
maximizing cash flow.
Introduce payment
technology tools
In the current business environment,
cash flow is top of mind for small busi-
nesses, so having the right tools in place is
essential. CPAs should have a checklist to
ensure clients have access to the right pay-
ment equipment and resources. They should
also develop relationships with banks and
merchant services providers that can help
CPAs advise clients. For a small merchant,
a template checklist could consist of the
following items:
•• Point-of-sale terminal(s) appropri-
ate for the merchant’s business
needs w
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 •• Corporate cards to help better
manage expenses and streamline
vendor payments
•• Check scanners to submit check
images electronically from home
or office for deposit
•• Procedures and systems that maxi-
mize data security/encryption at
the point of sale or as part of elec-
tronic and paper filing systems
Take, for example, a home-based delivery
business that needs to accept payments on
the go as well as at home. A CPA could con-
nect the business with a banker or merchant
services professional who can recommend a
wireless terminal, as it can accept all forms
of payment and can be used anywhere the
business owner needs to be. This increases
convenience and security for the business
and its customers, in part by reducing the
paper trail of sensitive information.
Additionally, businesses can use credit
cards within their own organizations to help
streamline vendor payments while capturing
the information needed to keep tabs on a
company’s finances.
CPAs also can help their clients move
away from paper and still accept checks by
utilizing affordable payment technology.
Having the correct technologies in place
allows small businesses to continue to ac-
cept checks while improving cash flow and
reducing the risk of accepting a fraudulent
check.
Virtual CFOs should work with clients
that accept a high volume of checks to inves-
tigate the following technologies:
•• The ACH network allows a busi-
ness to make authorized funds
transfers to and from its bank
account — in many cases skipping
the paper check process.
•• Electronic check acceptance
(ECA) converts a paper check to
an electronic transaction, useful
for merchants accepting checks in
person or over the Internet. The
transaction is cleared through the
ACH system, and funds are gener-
ally deposited in two business days.
ECA transactions may expedite ac-
cess to funds and reduce process-
ing fees at a company’s financial
institution.
26 Client Relations • Disclosures • May/June
•• Remote deposit allows business
owners to scan checks and submit
them electronically for deposit
from their home or office. Service
companies, home-based busi-
nesses and others who receive
check payments can gain access to
funds without the time and travel
required for daily bank runs or
delays when business demands
supersede in-person deposits.
Remote deposit may also offer a
business owner a later deposit cut-
off time.
Encourage data and
fraud protection
Organizations experiencing a data breach
in 2009 paid an average of $6.75 million
per incident to address the breach, rebuild
their brand image and retain customers,
according to Ponemon Institute’s 2009
U.S. Cost of a Data Breach Study. While this
may scale differently for small to mid-sized
businesses, the bottom line is that data
breaches are costly in terms of dollars, time
and reputation.
Virtual CFOs can help educate their
small business clients about the importance
of data security by discussing the potential
reputation damage and financial costs of a
data breach and other fraud. Advisors can
also connect businesses with the right re-
sources to help protect against fraudulent
activity and remind clients to keep current
with software and resources to help protect
the business’ and customers’ data.
For example, a CPA should encour-
age clients who accept card payments to
understand their obligations to comply
with Payment Card Industry Data Security
Standards (PCI DSS), a set of comprehen-
sive requirements for enhancing payment
account data security.
Many small businesses believe they are
exempt from compliance. However, every
merchant that accepts payment cards has
a cardholder data environment (known as
CDE, or the computer systems and ap-
plications that use or store sensitive card
data) that comes under the purview of the
PCI DSS. It’s possible to limit — and even
shrink — the scope of the CDE in order
to reduce or minimize the merchant’s PCI
burden.
Virtual CFOs should encourage clients
to work with their merchant services
provider to identify new technologies that
ease the burden of PCI DSS compliance. As
important financial advisors, CPAs are in a
position to guide clients toward resources
and solutions that meet individual business
needs. Examples of ways to help reduce or
eliminate the risk of fraud include:
•• Reducing or eliminating paper
checks, cash and expense reports
by automating systems using
corporate cards, payroll cards and
ACH as well as online financial
tools
•• Establishing fraud alerts using
online tools and automated con-
trols that alert the accountant and
small business as soon as suspicious
activity happens
•• Advising clients about new tech-
nologies that help protect financial
data and also minimize the burden
and cost of PCI compliance
As Virtual CFOs, CPAs will have the
resources to help set up the alerts and build
the procedures to analyze them and take ac-
tion when they happen. CPAs who follow
these strategies may not only broaden their
clients’ success, but also reap the rewards
of expanding their service offerings. While
technology plays a vital role in the Virtual
CFO approach, it isn’t just about the tech-
nology. It’s about using the technology to
help businesses run more efficiently and
protect sensitive financial information.
As technology advances, better access to
better information can help a CPA increase
his or her value to clients. Using electronic
financial and payments data can help CPAs
automate key reporting functions and spend
less time compiling reports and more time
working with clients to drive business suc-
cess, helping elevate the CPA’s role from
bookkeeper or advisor to Virtual CFO. 
Deborah L. Matz, group vice president at
SunTrust Bank, and her team of treasury
management sales professionals provide
payment system advice and solutions
to companies of all revenue size and in
various industry segments. Contact her at
(410) 986-1694 or deborah.matz@suntrust.
com. SunTrust Bank, Member FDIC.