CFO vs Finance Director vs Controller: Whats The Difference

cfo vs controller

As we continue to explore the role of the controller vs CFO, you’ll see what I mean. It requires a nuanced skillset, a background in finance (instead of, or in addition to, accounting), and a keen interest in the operations and direction of the company. If you are running a small business, your controller may do much of this work themselves.

He also served as the President and CFO for Interactive Donor, a New York-based Benefit Corporation which incentivizes charity through rewards. At The CEO’s Right Hand, we provide strategic financial advice and tactical accounting support to clients across all industries. This means you don’t have to choose a controller vs CFO when you work with us because you’ll get both capabilities under one roof. The salary range for a CFO is quite broad and dependent upon experience, the size of the company, the complexity of the industry, etc. For example, A CFO for a small company (~$10MM in revenues) will expect a base salary of around $225,000. Add in variable compensation, benefits, and taxes, and you’re looking at between $300,000 and $400,000 (or more) annually.

A Complete Finance and Accounting Department through Outsourcing

They must be able to recognize financial hazards and put strategies in place to protect the business from them. The chief financial officer (CFO) takes the aerial perspective from above the forest, while the financial controller is traveling through the woods to go from point A to point B. This is the simplest way to think about the distinctions between the jobs of the CFO and the financial controller. The chief financial officer (CFO) and controller collaborate closely in a business. They now play a pivotal role in supporting the organization’s sustainable growth.

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As part of their skillset, your company’s Controller and CFO should both understand generally accepted accounting principles (GAAP) and the accounting process to prepare the financial statements. Financial statements include balance sheets, income statements, and cash flow statements, with adequate financial disclosures. Vacations and time off will not leave your company high and dry when you rely on internal controls. With an outsourced financial controller on your team, you will have access to expertise in accounting and bookkeeping when you need it.

What is the Difference Between a Controller and a CFO?

A CFO’s role is more strategic, helping drive the company’s future, while a controller’s role is more tactical, assisting with the day-to-day operations of the finance and accounting departments. While controllers focus on looking in the rear-view mirror to see what has happened through historical data. The differences between the two are more than just a matter of semantics. The controller is more of a Chief Accountant, and this person reports to the CFO of a company.

What position is below CFO?

In large corporate hierarchies, a vice president of accounting position may also exist below the CFO depending on the volume of duties and management necessary to perform necessary accounting and financial functions.

You’ll need to decide which one is right for your business based on your needs, or whether both roles are necessary to fill at your company. They create long-term financial plans, track and analyze financial data, and make sure that the company is adhering to financial regulations. CFOs also work with investors and lenders to secure funding for the company. Controllers focus on details, as something as simple as a decimal point out of place could cause a major problem down the line. If decision-makers rely on incorrect information or projections, there could be major consequences, so controllers must make sure their reports are correct.

What’s the Difference Between a Financial Controller and a CFO?

However, don’t assume in all cases bookkeepers or accountants should also perform Controller functions. For more complex organizations, it is risky to have the same individuals performing both the analysis and data entry and the review of that analysis and data. And definitely don’t fall into the trap of giving a Bookkeeper level person the title inflation of Controller unless they are actually qualified to do the job.

While it may be tempting to let finance employees wear more than one hat, it is important to first understand the differences in day-to-day responsibilities and skillsets of CPAs, CFOs, Controllers and Bookkeepers. Now that you understand the roles of a controller and CFO, and what each can do for your business, which one do you hire? Medium-to-large businesses may already have a controller on staff but need a different perspective on financial discontinued operations statements, fundraising, and expansion. His first venture was CMR Technologies, a FinTech company based in San Francisco serving the investment management consulting space. From CMR, Mr. Lieberman formed Xtiva Financial Systems, a software company specializing in sales compensation solutions for the financial services industry. Mr. Lieberman served as Xtiva’s CEO, building the company to over $10 million in revenues and 100+ clients.

What Is a CFO?

The Controller’s oversight and monitoring of the business’ finances gives the CFO confidence in the financial data as accurate – and thus, actionable. A bookkeeper is in charge of day-to-day accounting tasks such as paying bills, posting accounts receivables, performing bank reconciliations and issuing 1099s. They are responsible for entering and coding financial data in the bookkeeping or financial management system. Both monitor internal controls and analyze accounting records, but a CFO wants to interpret those balance sheets in terms of a business’s overall financial health. This technical role can include managing accounts receivable, conducting operations oversight analysis, and creating and monitoring internal controls. The CEO’s Right Hand takes charge of your finance, accounting, human resources, and other foundational functions so you can focus on what you do best – running your company.

  • Let’s start was defining the word, ‘fractional.’ Fractional is defined as part-time and in this circumstance, the fractional CFO and/or fractional Controller working for you is doing so on a part-time or contracted basis.
  • The clarity we provided above can help you make the right choice, but taking action is vital.
  • Much like a modern CFO, a new-age SaaS finance controller is no longer just a backstage coordinator; they play a crucial role in managing a business’s revenue engine and growth.
  • Companies eliminate the need for in-house training and development by opting to outsource these roles, saving both time and money.
  • They oversee the preparation of financial reports, such as income statements and balance sheets.
  • Controllers focus on details, as something as simple as a decimal point out of place could cause a major problem down the line.

The CFO, in particular those of publicly listed companies, needs to have complete confidence that their subordinates are good. They also need to spend more time analyzing the business opportunities in the external arena. The CFO constantly looks for partnerships, investments, acquisitions, or market trends. It means a CFO has mostly responsibilities that involve dealing with an external scale.

Can a controller become a CFO?

Controllers that want to take the next step and move into the position of CFO must focus on ways to operationalize their team and improve business operations. Work to improve service delivery, focus on high-level strategic work and find ways to automate processes and workflow when you can.

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