At a high level, the finance department plans and manages company money, making sure a business can access cash in sustainable ways. This department can be as simple as a few people managing invoices or as complex as a team of hundreds with multiple levels of management. 

That said, there are a few key functions of a finance department that exist regardless of company size. Read on to learn more about each of the traditional finance department roles, how they differ depending on company size, and how they are evolving in today’s world. 

The Traditional Finance Department: Functions and Roles

Finance departments come in all shapes and sizes, but there are four key functions they must take on. None of these functions exists in a vacuum, and they will definitely need to communicate and collaborate with each other. Let’s explore each in more detail. 


This is a broad finance function that involves entering, categorizing and reviewing all financial transactions for a business. Both bookkeepers and accountants fill this role, and it is essential for maintaining accurate financial records. Some common recording tasks include:

  • Accounts Payable (A/P): Reporting money owed to the company’s suppliers
  • Accounts Receivable (A/R): Reporting any short-term money or financial assets owed to the company
  • Payroll: Maintaining up-to-date compensation data for the company, and processing monthly payments


This function oversees the recording function of the business to ensure company ledgers are accurate and adhere to financial regulations. A financial controller, also known as a comptroller, will usually be responsible for tasks like:

  • Accounting team management: Supervising the accounting/bookkeeping team to ensure accurate and timely reporting 
  • Inventory accounting: Monitoring, valuing and tracking inventory assets
  • Revenue recognition: Creating and applying controls for monthly financial reporting to ensure compliance


Financial planning and analysis, or FP&A, involves gathering relevant financial data and synthesizing it into digestible trends and forecasts that can inform business decisions. Some of the tasks FP&A analysts typically perform include: 

  • Data Visualization: Creating easy-to-digest visuals that help company executives understand business performance
  • Budgeting & Forecasting: Creating company-wide and department-level financial targets to guide the business each month 
  • Pricing Analysis: Determining the optimal price for company products


This is the role a Chief Financial Officer, or CFO, will likely inhabit. This executive has a large role in making strategic decisions and crafting the overall financial strategy. Additionally, a CFO oversees the entire finance department and uses the insights gathered through FP&A to communicate with internal and external business stakeholders. 

Finance Roles May Differ By Company Size

These finance department functions don’t have to be delegated to employees as listed above. Depending on the size of the company, you may have multiple people performing one function, or one person performing multiple functions. Here are examples of how you might see these functions broken out in businesses of various size: 

  • Startups: Newer, rapidly growing companies may not need a whole finance department at first, but as the company grows and finances become increasingly complex, the startup may need to hire a select team to help them manage. These professionals will likely take on multiple department roles. For example, the CFO and the controller are often the same person in a startup. Additionally, a CFO may flex to handle FP&A responsibilities in addition to strategic planning. 
  • Small Businesses: Most businesses of this size don’t have the need or funds to hire a whole full-time finance department. The business owner(s) often handle all of the record-keeping and finances, though they may work with a bookkeeper and/or accountant. Though there likely won’t be a full internal finance team, small businesses may contract with part-time finance professionals like a fractional CFO to support growth.
  • Midsize to Large Companies: Once a company has grown to be midsize or larger, the roles within the finance department will become more defined. Each finance team member will be responsible for one of the four finance functions, and there will often be entire teams of people for each specific task.

Regardless of company size, businesses can rest assured that if they have a team that handles recording, controlling, FP&A and finance management, they have covered all of the basic functions of a traditional finance department.

The Future Of Finance: How Finance Departments Are Changing

The demands placed upon the financial division of a company are multifaceted and rapidly changing. Traditionally, finance departments were ancillary to leadership. They would provide the numbers and data that executives used to inform big business decisions, but they wouldn’t necessarily make those decisions themselves. However, with recent shifts in the availability of tech tools as well as a shift in openness to non-traditional financial resourcing solutions, finance departments are becoming able to take on a much more strategic role. 

Tech and automation allow teams to build off of basic finance functions. 

New technology and automated processes have relieved finance teams of repetitive, manual tasks so the team can focus on adding value to the organization. 

For example, cloud-based accounting software allows accountants to automatically store large amounts of customer data like payroll, tax and invoice information at a lower cost to the business. Two common cloud-based accounting softwares are QuickBooks and NetSuite. These are full-service bookkeeping and accounting platforms that perform several operational functions like accepting business payments, payroll and more. 

New technologies are rapidly automating bookkeeping and accounting procedures so finance departments can move resources away from administrative tasks and more toward analysis and strategy. With large amounts of data in one place, analysts, controllers and CFOs can now easily perform customized analyses, recognize patterns and make better-informed business decisions. In sum, new finance technologies are augmenting finance roles, enabling them to be more analytical and bring strategic insight to the table because it is reducing the need for people to focus solely on data collection. 

This digital transformation implies that future finance department professionals will need more than mastery of financial concepts. According to McKinsey’s Finance 2030 article, finance professionals will also need skills in programming and computing analytics so they can easily navigate complex finance and AI tools. They will also need to be able to translate the outputs into plain English for stakeholders.

In the future, the finance industry may see more advanced technologies manage additional repetitive tasks. For example, Optical Character Recognition (OCR), AI and speech analytics technology may eventually make it so invoice transactions and communications can be handled by software. With these changes, finance departments will have the opportunity to shift their focus toward being key decision-makers and strategic advisors for a business.

Fractional finance solutions offer flexibility and precision.

Traditionally, finance departments have limited themselves to hiring full-time employees within their geographic region. However, in recent years, many companies have shifted their approach, relying instead on freelance professionals to complete finance functions on a project basis. There are several benefits to this approach: 

  • Freelance finance professionals often have years of experience in top-tier firms tackling the specific business problem a company may be trying to solve. 
  • Companies only have to pay freelance financial talent for the service provided. This can save the company a lot of money in recruiting, benefits and overhead costs. It also provides the option for working within the company budget for additional resources. 
  • Unlike a full-time employee, companies don’t have to engage the same professional for every project. Businesses are free to source the person who has the right skills, experience and credentials for each specific business need.
  • Companies who outsource remote financial talent allow themselves more freedom to hire the best person for the job, regardless of geographic location or time zone. In this way, outsourcing to freelance finance professionals gives companies a wider pool of talent to choose from.

Future-proofing your finance department requires continuing to adapt as technology and the workplace evolve. At the same time, core finance department functions and roles need to be addressed to support your business needs. 

At Paro, we leverage our proprietary AI technology to build flexible, focused teams of freelance finance experts that help companies solve problems and drive growth. Our laser focus on finance allows us to quickly identify experts across the U.S. with the right mix of skills, credentials, and experience to achieve each company’s specific goals. Fill out this form to get a consultation that will help you form the finance team you need to build your company’s future.