CFO or Controller- Whom should you hire? 

Did you also hear that CFO and Controller are similar? Or are you also in a dilemma of who of the two is best for your business? 

Then continue reading, pal, to learn the difference between the two. 

A business’s success depends on strategic business planning. A controller is a part of your accounting team, whereas a CFO is part of your finance team. Before jumping on the difference, read a brief of both roles. 

 

Who is a CFO? 

CFO, as the name suggests, is the top financial executive in a company. They design financial strategies for the firm, and their responsibilities include cash flow management and financial planning. Moreover, they track your firm’s financial performance and give actionable corrective measures. 

CFOs are similar controllers as they manage the finance and accounting department. They also oversee the accuracy and timely completion of financial reports. Their role is a prime advisor to CEOs, and they are vital guidance in strategic partnerships and mergers and acquisitions. 

Who is a Controller? 

A controller is responsible for the entire accounting activities. They need to report to the CFO of your company (if any). In large companies, their role includes monitoring the bookkeeping & accounting department. Besides supervising payroll processing, and financial reporting, they also assist the CFO in preparing budgets. However, in small businesses, a controller can fulfil both roles. A controller handles everything from bookkeeping to financial planning. Moreover, they oversee the recruiting and training process. 

• Preparing financial statements
• Administering accounting and bookkeeping department
• Financial planning 
• Participating in the budget schedules
• Overseeing a company’s trends, variances, etc., from the budget.
• Analyzing financial information
• Supervising taxation, license, and compliance

4 Major Differences Controller and a CFO 

• Expertise

A Controller is an expert and the face of the accounting department, and they must know the latest Generally Accepted Accounting Principles (GAAP) and tax laws. A CFO’s scope of work includes financial planning, capital markets, and investing. Though they must understand accounting, they don’t need to be CPAs. So a CFO works in the financial department as the face of the company.

• Approach

Controllers have a tactical approach with a set pattern of work, aiming for accuracy. A CFO processes payroll monthly & prepares financial reports with a strategic approach and advises top management on ways to improve financial health.

• Focus 

The controller develops, disseminates, and monitors a company’s internal control. They prevent and detect fraud & errors. So they are involved in the internal workflow and process of a company. In comparison, a CFO must have complete confidence in their controllers- as they have to oversee the external—for instance, partnerships, investment opportunities, and mergers. 

• Leadership 

Both the CFO and controller manage a company’s finance. However, a controller reports to the CFO, who gives the final financial measure to top management. So, a CFO sets the tone of the entire financial department, and a controller translates this tone into the daily activities of a company. 

 

Read: From Controller to CFO

 

Whom should you hire?

• Are you looking for someone to develop a strong finance team? 

A top-notch CFO is the backbone of any company. As for CFOs, the numbers are not just numbers but your company’s financial story. If you want to accelerate your economic story, hiring a CFO will help you. 

When you go for a loan or raise funds, they first need some resourceful data. So a CFO designs fascinating and insightful knowledge banks for your company. Besides offering financial strategy, he guides the executive team in vital business decisions. 

• Need assistance in fundraising?

You might need help to convey your financial story properly if you are an entrepreneur or a new business owner. But a CFO can lead in telling the story in the fundraising process, and he knows the best words to describe your financial health to investors. 

• Are you looking for someone to monitor your bookkeeper?

If you neither have a CFO nor time to monitor bookkeeping, hire a controller. For any small business, it’s best to close books monthly. So if your bookkeeper is facing a hard time in monthly reviewing or closing books, a controller is the solution. 

• Are you concerned about errors, fraud, and security? 

Often, a bookkeeper may need help identifying errors and suggesting corrective measures in financial reports. So, hiring a controller will bring his technology & accounting expertise. Plus, a controller will access all essential information required for taxation. 

 

Conclusion

Both controllers and CFO are different, but both aim to improve your company’s financial health. With the advent of technology, you can hire a part-time controller and CFO. Before hiring, you must know who is best for your problem. Schedule a call with us now to understand your company’s needs.