You don’t have time to manage your business’ books, but do you need a bookkeeper, financial controller or a CFO to take them over?
Most small businesses typically start with the business owner, a family member or a friend running the books. While this is acceptable in the beginning stages of a business, problems are likely to arise as your business flourishes.
It’s vital to hire a professional to take care of your company’s books, but what kind of professional do you need? A bookkeeper? A financial controller? A chief financial officer (CFO)?
Today, we’re here to discuss the roles of financial professionals and help you decide which is best for your business.
Financial Professional Roles
Managing any businesses’ finances is a critical task that often gets overlooked, especially in the early years of a company. There are multiple types of financial professionals you can hire to help you with your company’s finances. Still, depending on the size of your business, not all may be applicable (yet).
When your accounting and bookkeeping duties get in the way of generating sales, managing employees and other tasks that only you can do, it’s time to hire a bookkeeper. Bookkeepers manage accounts payable and accounts receivable, process payroll, complete monthly reconciliations, and enter transactions into accounting software. Hiring a bookkeeper can free up a significant amount of time for essential duties that only you, as a business owner, can complete.
Experienced bookkeepers often perform well above their positions and assist with other business elements such as budgeting and cash flow forecasting.
As businesses grow more prominent, most experts advise on hiring a financial controller. Controllers oversee all accounting processes and are responsible for timely and accurate monitoring and reporting of the company’s overall financial performance. Their duties include monthly accounting, budgeting, cash flow forecasting and ensuring that business policies, accounting standards and profit objectives are met. Controllers often oversee administrative staff, IT functions and HR and collaborate with other senior managers to create a financial strategy and plan for its success.
Financial controllers are typically CPAs (certified public accountants) and have the knowledge and experience to assist with tax strategies and deeper financial analysis. In many cases, bookkeepers transition into or assume the role of the financial controller.
Chief Financial Officer (CFO)
Similar to a financial controller, a CFO, or Chief Financial Officer, is also responsible for timely and accurate monitoring and reporting of the company’s overall financial performance. However, their role is more strategic and forward-looking than that of a financial controller. While a Controller can provide financial insights on strategic decisions, the CFO takes a more holistic view and can recognize, for example, that what might immediately save money through efficiency could cost the company long-term in customer satisfaction.
The CFO uses the information the financial controller produces to evaluate opportunities such as new business lines or territories and determines the best plan of action to pursue them. They manage financial relationships with banks and investors and steer the company through business structure and operations changes.
A CFO may be a CPA or have a different designation, and they may also have a financial controller reporting to them. The holistic and strategic focus of a CFO is what separates them from other accounting positions.
In business, titles often blend or blur, and it’s not easy to know who to utilize.
As a business owner, you don’t have time to manage your business’ books, and the more your business grows, the more time-consuming the financial aspect will become. But now, you should have a better idea of what type of accounting professional can help you the best and their roles and duties.
To learn more about which of these positions is suitable for your business or how to go about integrating one of these roles into your organization, contact us right away.
We’re always happy to chat.