Decision Time: Why Your Company Needs a Controller, CFO, or Both

CFO or Controller?

Should the lead financial manager at your company be a Controller or a CFO? This is highly dependent upon your organization’s size, complexity, and growth goals. A Controller provides a solid accounting foundation for accuracy and ensures that controls are in place to reduce the risk of fraud. A CFO takes responsibility for these basics and also provides a strategic and business perspective.

Controller vs. CFO

A Controller has the responsibility of establishing the framework that assures the proper recording of all of the organization’s transactional activity. Controllers get the recording of invoices from suppliers, invoices sent to customers, payroll transactions, and the application of payments received from customers recorded correctly. At the end of the month they perform a summarization of these transactions commonly referred to as the monthly closing.

Generally, a CFO has performed the Controllership responsibilities and has also acquired much broader business experience. A CFO is going to focus more on the business and the profitable growth of the organization. They will try to identify the critical performance indicators which determine either success or failure. Their goal is to positively impact overall financial performance by working with the team to set performance goals for each key indicator and by measuring and reporting progress toward those goals. With a forward looking approach, the CFO ensures that any imminent changes to internal or external factors are identified and acted upon to make sure the organization is prepared for forces that may impact their business.  

The CFO also partners with each executive in the organization to support their needs as an integral part of a business structure, making certain that ROI-growing tactics are executed properly and meet expectations. Whether that individual is the IT Director, Sales Managers, or CMO, the CFO uniformly deploys resources across the entire group to effectively and efficiently achieve the set goals, while fostering communication and synergy between each department.  A good CFO will also allow the CEO/President to focus on operating the business while they deal with other monetary-based tasks such as banking relationships, cash management, and investor relations.

Why You Need One of These People in Your Corner

Every organization needs a Controller to make sure the foundation is set and structured appropriately. However, any organization that wants to grow or expand also needs to have a CFO to help set and support those growth plans. The difference between these two roles are truly vast. A business that may not be large enough to afford a true full-time CFO may want to utilize services that can provide a part-time CFO-level executive. For businesses that are in mid-growth, utilizing a part-time CFO can be an effective solution to maximize that growth. An experienced part-time CFO is particularly advantageous to a business because of their knowledge and skills to foresee any obstacles, since they have already navigated those hurdles in other organizations.  

One of the biggest mistakes businesses make is not hiring a CFO soon enough in their development cycle. If you are unsure of whether or not you need one yet, it’s what you don’t know about your business that often hurts you the most. A part-time solution can help you find out what needs to change without the risk of hiring a full-time CFO, which is where we come in. Visit our Contact Us page to let us know how we can help and see how enlisting a part-time CFO can be course-changing for your business.