A controller is a senior manager who also serves as the head of accounting. A robust controller can help lead the way and may take on some of the tasks of a chief financial officer (CFO) for growth-stage firms that are expanding their finance teams.
what does an accounting controller do?
Financial controllers are not in charge of data input, but they may be involved in many of the organization’s day-to-day financial activities. A controller will, depending on the demands and size of the company,
manage the financial teams
Assist in hiring and managing the company’s financial and operational personnel. Invoicing, accounts receivable, accounts payable, bookkeeping, payroll, and tax preparation are all tasks that the controller may assist with (and is occasionally actively involved with).
watch how books end
Record, reconcile, and approve transactions to close the books at the end of each month, quarter, and year.
create and maintain accounting policies
Review, develop, and execute accounting policies for the company based on its industry and the proper financial reporting structure.
be in charge of the financial statements
Be in charge of developing and maintaining the company’s financial statements.
provide strategic financial advice.
Serve as a liaison between the financial and executive teams, assisting in the preparation of reports and predictions.
plan for and respond to audits
Create systems and controls that are scalable and give a clear audit trail. The controller can assist in the prevention of internal fraud, the detection of incorrect spending, and the management of internal and third-party audits.
As businesses expand, a distinct internal audit job may be required.
A controller can assist you in uncovering savings possibilities and boost your profitability or runway by having a thorough understanding of your company’s finances.
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how do you determine whether you need a controller?
Unless you’ve outsourced your bookkeeping and accounting, a controller will unlikely be your first finance-related job. Bringing on a controller early on could assist you in building up procedures and establishing strategies that will support the growth of your organization. You could require controller services if:
you don’t have clear accounting policies.
While accounting software can enter transactions automatically, appropriately categorizing transactions is complex and the controller will determine the policies.
Understanding when an expense falls under the cost of goods sold (COGS) vs. operating expenses (OPEX), for example, might assist you in identifying savings opportunities. Knowing when to recognize revenue in accordance with GAAP can also be helpful when dealing with investors and creditors.
you’re gaining ground swiftly
So what do controllers do? A controller can assist in explaining the company’s present financial situation and the implications of various decisions, which is especially crucial during periods of rapid expansion.
As the chief accountant, the controller will also assume some managerial responsibilities, freeing the executives to focus on the big picture.
you are worried about an audit
The controller can also guarantee that the company complies with local, state, and federal regulations and is audit-ready. If your company is audited, the controller can take the lead by drafting reports and responding to them.
Hiring a controller costs more than hiring a bookkeeper or accountant, but an intelligent controller can save you more time and money than they cost.
controller vs. chief financial officer
A controller manages the accounting services, may provide hands-on assistance, and ensures the organization’s financial records are accurate. However, the chief financial officer (CFO) employs this data in a more strategic and forward-thinking manner.
As the company’s senior financial leader, a CFO may:
- Set financial goals, define and record KPIs, and develop forecasts for budgeting.
- Collaborate with the executive team to understand how the financial teams can support the broader goals of the business.
- Interpret the figures for the company’s leaders, board of directors, and investors; prepare pitches; and raise funds from more investors.
Small businesses may have a single employee who handles duties that generally fall under both job titles.
helpful resource: what’s the difference between a cfo and a controller?
When a corporation appoints a CFO, the controller is almost certainly a direct report. In large firms with several finance divisions, there may be extra layers between the controller and the CFO.
A CFO’s remuneration can be two to three times that of a controller, making hiring a CFO a significant challenge. Companies that could benefit from senior financial experience but are unwilling to incur the additional expense can profit from outsourced CFO services.
bookkeeper vs. controller
While the controller establishes the company’s policies and oversees regulatory compliance, bookkeepers put these policies into effect on a daily basis by tracking and recording financial transactions.
Bookkeepers are in charge of:
- categorizing transactions
- reconciling the business’s bank accounts
- assisting the controller in preparing financial statements
- handling bills and invoices
Many of the bookkeeper’s responsibilities are transactional and administrative in nature, and bookkeepers might benefit from robust software, which the controller may assist in selecting.
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An accountant, not a bookkeeper, can dive into the numbers, make recommendations, and handle some higher-level jobs. Accountants and bookkeepers will both be crucial parts of the controller’s team.
Another thing to consider is that experienced controllers, like CFOs, are generally expensive to hire. Consider outsourced controller accounting services as an economical alternative if your firm has reached the point where it requires the skills of a controller but does not have the numbers to justify an in-house appointment.
In addition to delivering books on time and with accuracy, Countick
provides CFO and Controller services to assist young businesses.
