Fractional CFO Playbook

Complete operational playbook for Fractional CFO engagements. Covers client onboarding financial assessment, monthly close cadence, board-ready reporting pac...

Security Scan

This is an instruction-only playbook for running Fractional CFO engagements — its contents, triggers, and required artifacts are coherent with the stated purpose and it does not request installs, credentials, or system access.

Purpose & Capability

The name and description match the SKILL.md content: checklists, engagement tiers, onboarding and monthly-close procedures, and templates. There are no unrelated requirements (no binaries, env vars, or config paths).

Instruction Scope

SKILL.md contains only procedural guidance, templates, and reporting examples. It does not instruct the agent to read system files, access external endpoints, or exfiltrate data. It does reference obtaining access to clients' accounting systems (QBO/Xero/NetSuite), which is appropriate for the playbook's purpose but is an operational action the human/agent will need to perform separately.

Install Mechanism

No install spec or code files are present. This is an instruction-only skill, so nothing is downloaded or written to disk by the skill itself.

Credentials

The skill declares no required environment variables, credentials, or config paths. There are no unexpected or excessive secret requests relative to the stated function.

Persistence & Privilege

always is false and model invocation is allowed (platform default). The skill does not request persistent presence or system-wide configuration changes.

Assessment

This playbook appears internally consistent and low-risk as an instruction-only skill. Before installing, consider: 1) provenance — the source is unknown (registry owner ID present); verify you trust the author and organization if you plan to use it with real clients; 2) sensitive data handling — the guidance assumes access to client accounting systems and financial data; do not paste actual credentials, PII, or raw client exports into the agent unless you trust its execution environment and have proper consent; 3) autonomy settings — the skill can be invoked by the model (platform default); if you worry about unattended actions, restrict autonomous invocation or require user confirmation for any step that accesses or transmits client data; 4) integration work — this playbook references actions (connect bank feeds, access QBO/Xero/NetSuite) that will require separate, secure integrations and credentials managed outside of this skill. If those integrations are needed, follow your organization’s credential-handling and least-privilege practices.

The complete operating guide for running Fractional CFO engagements — from first call to ongoing monthly value delivery. This skill encodes PrecisionLedger's methodology for outsourced finance executive services.

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When to Use This Skill

Trigger phrases:

• "Set up fractional CFO engagement for [client]"
• "What should I deliver as fractional CFO this month?"
• "Prepare the monthly CFO package for [client]"
• "New fractional CFO client — what do we need?"
• "Client wants board-ready financials"
• "CFO advisory scope for [stage/industry]"
• "Cash flow is tight — what does the CFO do?"

NOT for:

• Building a full 3-statement model from scratch → use startup-financial-model
• Bookkeeping, reconciliation, or data entry → use qbo-automation
• Tax return preparation or filings → PTIN-required, escalate to Irfan
• One-time financial analysis without CFO context → use financial-analysis-agent
• Cap table and equity management → use cap-table-manager

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Engagement Tiers

Define scope before starting. Three standard tiers:

Tier	Hours/Month	Deliverables	Price Range	Best For
Starter	5–8 hrs	Monthly close review, cash flow report, 1 strategy call	$1,500–$2,500/mo	Pre-revenue to $500K ARR
Growth	12–20 hrs	Full reporting package, KPI dashboard, board prep, 2 calls	$3,500–$6,000/mo	$500K–$5M ARR
Executive	20–40 hrs	All of Growth + fundraising support, audit prep, team mgmt	$6,000–$15,000/mo	$5M+ ARR or fundraising

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Phase 1: Client Onboarding (Week 1–2)

Financial Assessment Checklist

□ ACCOUNTING SYSTEMS
  □ Access to QBO / Xero / NetSuite granted
  □ Chart of accounts reviewed — gaps or misclassifications noted
  □ Bank feeds connected and reconciled YTD
  □ Historical period reviewed (12–24 months minimum)

□ FINANCIAL HEALTH SNAPSHOT
  □ Trailing 12-month P&L reviewed
  □ Balance sheet reviewed — any red flags?
  □ Cash flow statement reviewed (or reconstructed if missing)
  □ AR aging report pulled — any collection issues?
  □ AP aging report pulled — any payables over 60 days?

□ COMPLIANCE & STRUCTURE
  □ Entity structure confirmed (LLC, C-corp, S-corp?)
  □ Tax returns reviewed (last 2 years if available)
  □ Active contracts list obtained (leases, debt, subscriptions)
  □ Payroll provider confirmed (Gusto, ADP, etc.)
  □ Bank accounts and signers list obtained

□ METRICS & BENCHMARKS
  □ Gross margin calculated and benchmarked to industry
  □ Burn rate established (if pre-profit)
  □ Revenue concentration — top 5 clients as % of revenue?
  □ Key financial KPIs identified and baseline set

Onboarding Output: Financial Diagnostic Report

Produce a 1-page diagnostic for the client:

FINANCIAL DIAGNOSTIC SUMMARY
Client: [Name] | Date: [Date] | Prepared by: PrecisionLedger / Sam Ledger

FINANCIAL HEALTH SCORE: [Red/Yellow/Green per category]

Category          Status    Notes
────────────────────────────────────────────────
Cash Position     🟡 Yellow  $180K — 4 months runway at current burn
Revenue           🟢 Green   $42K MRR, growing 8% MoM
Gross Margin      🔴 Red     38% — below SaaS benchmark of 60–70%
AR Aging          🟡 Yellow  $28K over 60 days — 3 accounts to address
AP/Payables       🟢 Green   Current, no overdue
Bookkeeping       🟡 Yellow  2 months behind — catching up underway
Compliance        🟢 Green   Tax returns current, payroll compliant

TOP 3 PRIORITIES THIS QUARTER:
1. Improve gross margin: audit COGS, renegotiate vendor contracts
2. Accelerate AR collections: implement net-30 enforcement + follow-up workflow
3. Extend runway: reduce discretionary spend by ~$15K/month

UPCOMING DEADLINES:
• March 15 — Q4 estimated tax payment
• April 15 — Annual tax filing or extension
• May 1 — Lease renewal decision required

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Phase 2: Monthly Close Cadence

Close Calendar (Standard Timeline)

Day 1–3 (after month end):
  □ Bank reconciliation completed for all accounts
  □ Credit card transactions categorized
  □ Payroll entries posted and reconciled

Day 4–7:
  □ Revenue recognized per schedule
  □ Prepaid expense amortization entries posted
  □ Accounts receivable invoices confirmed sent
  □ Accruals posted (liabilities incurred but not invoiced)

Day 8–10:
  □ Unadjusted trial balance reviewed
  □ Intercompany eliminations (if applicable)
  □ Depreciation/amortization posted

Day 11–15:
  □ Final trial balance locked
  □ Financial statements drafted
  □ Flux analysis completed (month-over-month variance review)
  □ CFO package assembled and reviewed

Day 15–20:
  □ CFO package delivered to client
  □ Monthly strategy call scheduled
  □ Prior month action items reviewed

Month-End Flux Analysis

Review every line item variance > 10% or > $5K:

FLUX ANALYSIS TEMPLATE

Account           Prior Mo    Current Mo    $ Change    % Change    Explanation
────────────────────────────────────────────────────────────────────────────────
Revenue           $95,000     $103,000      +$8,000     +8.4%       New client Jan 15
COGS              $32,000     $39,000       +$7,000     +21.9%      ⚠️ Investigate
Payroll           $48,000     $53,000       +$5,000     +10.4%      New hire Feb 1
Software Tools    $4,200      $6,800        +$2,600     +61.9%      ⚠️ New subscriptions

Flag any unexplained variance > 15% for discussion on the monthly call.

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Phase 3: Monthly CFO Package

Standard Deliverables

Every month, deliver a client-ready package containing:

1. Executive Summary (1 page)

[CLIENT NAME] — MONTHLY CFO BRIEF
Month: [Month Year] | Prepared: [Date]

HEADLINE NUMBERS
  Revenue:      $103,000  (+8.4% vs prior month)
  Gross Profit: $64,000   (62% margin — on target)
  Net Income:   ($12,000) (investing in growth)
  Cash Balance: $285,000  (6.2 months runway)

WINS THIS MONTH
  • Closed largest deal to date — $12K MRR contract
  • COGS margin improved 3 points after AWS renegotiation
  • Collected $18K of aged AR

CONCERNS / WATCH ITEMS
  • Software spend up 62% — conducting audit next week
  • Two invoices 45+ days overdue — escalating collections
  • Runway tightening — fundraise timeline decision needed by Q2

ACTION ITEMS FOR NEXT MONTH
  □ Software audit — identify and cancel unused tools [CFO]
  □ Collections call on Acme Corp $8,200 invoice [Ops]
  □ Series A readiness checklist review [Founder + CFO]

2. Financial Statements (3 pages)

• Income Statement: Month + YTD, vs. prior month, vs. budget
• Balance Sheet: Current month vs. prior month
• Cash Flow Statement: Simplified operating/investing/financing

3. KPI Dashboard

METRIC                 CURRENT    PRIOR MO    TARGET    STATUS
──────────────────────────────────────────────────────────────
MRR                    $103,000   $95,000     $100,000  🟢 Ahead
MRR Growth (MoM)       8.4%       6.2%        7%        🟢 On Track
Gross Margin           62%        58%         65%       🟡 Improving
Customer Count         47         43          50        🟡 Close
Cash Runway (months)   6.2        7.1         6+        🟡 Watch
AR Days Outstanding    38 days    31 days     30 days   🟡 Watch
Burn Rate (net)        $12,000    $8,000      <$15,000  🟢 OK
Payroll as % Rev       51%        50%         <55%      🟢 OK

4. Cash Flow Forecast (13-week)

13-WEEK CASH FLOW FORECAST
Week   Start Cash   Inflows    Outflows   End Cash    Notes
─────────────────────────────────────────────────────────────
Wk 1   $285,000     $35,000    $42,000    $278,000    Payroll Fri
Wk 2   $278,000     $18,000    $8,000     $288,000    AR collect
Wk 3   $288,000     $22,000    $15,000    $295,000
...
Wk 13  $XXX,000     ...        ...        $XXX,000    Projected

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Phase 4: Strategic Advisory Functions

Cash Flow Management

Weekly cash flow discipline:

1. Monitor bank balance every Monday
2. Review AP due this week — approve payment run
3. Flag any AR 30+ days overdue for follow-up
4. Update 13-week forecast if assumptions change
5. Escalate if projected cash < 3 months runway

Cash flow levers (when runway is tight):

ACCELERATE INFLOWS:
  □ Offer early payment discount (2/10 net 30) for key AR
  □ Move to upfront/annual billing for new clients
  □ Collect deposits on new projects
  □ Line of credit draw if available

DEFER OUTFLOWS:
  □ Negotiate extended terms with vendors (net 60–90)
  □ Defer non-critical hiring 30–60 days
  □ Pause discretionary spend categories
  □ Renegotiate SaaS contracts to annual prepay for discount

BRIDGE OPTIONS:
  □ Revenue-based financing (Clearco, Pipe, Arc)
  □ SBIC / SBA loan for established businesses
  □ Convertible note bridge from existing investors
  □ Founder personal bridge (document properly)

Fundraising Support

When a client is raising capital:

FUNDRAISING READINESS CHECKLIST (CFO Role)

□ FINANCIAL DATA ROOM
  □ 3 years historical financials (audited if available)
  □ Current YTD financials (within 30 days)
  □ 3-year financial model (base/bear/bull)
  □ Unit economics summary (LTV, CAC, payback period)
  □ Revenue cohort analysis
  □ Cap table (current + pro forma post-raise)

□ METRICS PACKAGE
  □ MRR/ARR waterfall (12 months)
  □ Gross margin trend
  □ Burn and runway calculation
  □ Net Revenue Retention
  □ Customer count and churn

□ DILIGENCE SUPPORT
  □ Bank statements (12–24 months)
  □ Payroll records
  □ Material contracts list
  □ IP and asset register
  □ Outstanding liabilities schedule

□ INVESTOR NARRATIVE
  □ Financial story: how does the business make money?
  □ Why the numbers look the way they do
  □ What this raise funds and for how long
  □ Key milestones unlocked by this capital

Board Meeting Preparation

Monthly or quarterly board package:

BOARD PACKAGE STRUCTURE

1. EXECUTIVE SUMMARY (1 page)
   - Revenue, growth, margin, cash — vs. prior period and budget
   - Top 3 wins, top 3 challenges

2. FINANCIAL STATEMENTS (3 pages)
   - P&L with budget variance column
   - Balance sheet
   - Cash flow summary

3. KPI SCORECARD (1 page)
   - All agreed board-level KPIs in one table
   - Red/Yellow/Green status

4. BUDGET VS. ACTUAL (1 page)
   - Month and YTD variance
   - Explanation for significant variances

5. UPDATED FORECAST (1 page)
   - Revised full-year projection
   - Key assumption changes since last board meeting

6. APPENDIX
   - Department-level P&L breakdowns
   - Headcount report
   - Pipeline/bookings summary (if available from sales)

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Engagement Management

Scope of Work Template

FRACTIONAL CFO ENGAGEMENT — SCOPE OF WORK

Client: [Client Name]
Effective Date: [Date]
Tier: Growth ($4,500/month, 15 hours/month)

MONTHLY DELIVERABLES:
1. Monthly financial close oversight (Days 1–15)
2. Financial statements (P&L, Balance Sheet, Cash Flow)
3. KPI dashboard update
4. 13-week cash flow forecast
5. Monthly CFO brief (executive summary)
6. Two 60-minute strategy calls per month

QUARTERLY DELIVERABLES:
7. Updated 12-month financial model
8. Board package preparation
9. Quarterly business review presentation

ANNUAL DELIVERABLES:
10. Annual budget and operating plan
11. Year-end close support and audit readiness
12. Annual financial strategy review

OUT OF SCOPE (separate engagement or referral):
• Tax return preparation and filing
• Bookkeeping and daily transaction recording
• Payroll processing
• Legal or HR services
• Audit or attest services

COMMUNICATION:
• Primary contact: [Name]
• Response SLA: 24 hours (business days)
• Emergency escalation: [method]
• Monthly call: [recurring time]

FEES:
• Monthly retainer: $4,500 (billed 1st of month)
• Overage: $250/hour above 15 hours (pre-approved)
• Out-of-pocket expenses billed at cost with receipts

Client Health Scorecard

Track engagement health monthly:

CLIENT: [Name] | MONTH: [Month]

Relationship Health
  □ Monthly call completed?          Y/N
  □ Deliverables on time?            Y/N
  □ Client responsive to requests?   Y/N
  □ Open action items > 30 days old? Y/N

Financial Health Indicators
  □ Bookkeeping current?             Y/N
  □ Cash > 3 months runway?          Y/N
  □ No undisclosed liabilities?      Y/N
  □ Compliance deadlines on track?   Y/N

Engagement Risk
  □ Scope creep this month?          Y/N
  □ Hours within budget?             Y/N
  □ Any relationship concerns?       Y/N
  
OVERALL STATUS: 🟢 Healthy / 🟡 Watch / 🔴 Escalate

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Industry-Specific Benchmarks

SaaS

Gross Margin:          65–80%  (below 60% = cost problem)
S&M as % Revenue:      20–40%  (early stage) / 15–25% (mature)
R&D as % Revenue:      15–25%
G&A as % Revenue:      8–15%
Rule of 40:            ≥40 (Growth % + EBITDA Margin %)
NRR (Net Rev Retention): >100% excellent, 80–100% ok, <80% problem
LTV:CAC:               ≥3:1 minimum, 5:1+ healthy

Professional Services / Consulting

Gross Margin:          50–70%  (revenue minus direct labor)
Utilization Rate:      65–75%  (billable hours / available hours)
Revenue per Employee:  $150K–$350K (varies by specialty)
Client Concentration:  No single client >25% of revenue
AR Days:               <35 days ideal

E-commerce / Retail

Gross Margin:          30–60%  (depends on category)
Inventory Turnover:    6–12x per year
CAC:LTV:               ≥3:1
Return Rate:           <5% ideal
COGS % Revenue:        40–70%

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Integration Points

• startup-financial-model — Build 3-statement models for fundraising prep or annual planning
• kpi-alert-system — Automate threshold alerts for KPIs tracked in monthly CFO package
• qbo-automation — Pull actuals from QuickBooks for close and reporting
• ar-collections-agent — Manage AR follow-up workflow surfaced in CFO package
• cap-table-manager — Handle equity and dilution modeling during fundraising support
• thirteen-week-cash-flow — Generate detailed 13-week cash flow forecast
• budget-vs-actual — Produce variance analysis for board packages
• investor-memo-generator — Convert CFO financial narrative into investor documents

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Quick Reference: CFO Monthly Checklist

WEEK 1 (Days 1–7)
  □ Bank reconciliations complete
  □ Payroll reconciled
  □ Revenue recognition entries posted
  □ AR invoices verified sent

WEEK 2 (Days 8–14)
  □ Accruals and adjusting entries
  □ Trial balance reviewed
  □ Flux analysis completed
  □ Statements drafted

WEEK 3 (Days 15–20)
  □ CFO package finalized
  □ Package delivered to client
  □ Monthly strategy call held
  □ Action items documented

WEEK 4 (Days 21–31)
  □ Next month prep (budget check, upcoming deadlines)
  □ 13-week cash forecast updated
  □ Compliance calendar reviewed
  □ Client health scorecard updated