At the intersection of transactions, operations and strategy sits one of the most critical finance leadership functions: the financial controller. Financial controller responsibilities mix accounting expertise with strategic acumen, sometimes similar to a chief financial officer (CFO).
As automation and intelligent tools reshape the financial processes, they simultaneously position controllers as the essential change agents guiding adoption. Equipped with strategic business acumen and system implementation savvy, modern controllers evolve to take finance functions to the next level.
What Is a Controller?
Primarily, a financial controller is an executive who oversees the accounting functions of a business, ensuring that a company’s ledgers are accurate and adhere to financial regulations. Also known as a comptroller or accounting controller, they create and supervise the processes for recording a company’s finances.
What Does a Controller Do?
As the head of accounting, financial controller responsibilities focus on managing the people, process and technology behind the function. Financial controller services include:
- Accounting team management: Supervising the finance team and managing operations to ensure accurate and timely reporting
- Financial reporting: Using software to package financial reports for consumption by internal decision-makers and external stakeholders and investors
- Inventory accounting: Monitoring, valuing and tracking inventory assets
- Revenue recognition: Creating and applying controls for monthly financial reporting to ensure compliance
- Formal procedure creation: Spearheading standardized operating procedures (SOPs) for data collection, budgeting or month-end close
- Data integrity: Acting as stewards of complete, consistent and accurate data, especially as businesses prime data for automation and AI adoption
- Month-end close: Enabling accurate reporting and analysis, and providing insights on the company’s financial position
- Contract and financial covenant analysis: Reviewing contracts and agreements such as vendor contracts and loans and explaining their financial implications to company leadership
- Due diligence in mergers and acquisitions: Reviewing and investigating a potential deal or investment opportunity for the business, such as a private equity investment
That said, a financial controller does not deal solely with the accounting team. A controller also serves as the liaison between the finance team and senior management, using financial data to offer strategic insights to internal stakeholders. Controllers are skilled communicators who can link company finances to overall business objectives and goals.
Controller vs. Accountant: What’s the Difference?
While it’s common for a controller to be a certified public accountant (CPA), the duties of a financial controller have a broader scope than an accountant, though there can be overlap at smaller firms.
Accountants prepare financial reports, reconcile data for accuracy and compliance and analyze financial risk. Controllers serve as lead accountants, working to optimize these operations and manage costs. It also requires cross-departmental communication—another key difference from accountants.
At a small firm, the controller may be responsible for accounting duties. At a larger firm, their supervisory role takes precedence, and they may report to management through a chief accounting officer (CAO) or CFO.
Is a Controller Similar to a CFO?
In many ways, a financial controller can have duties on par with that of a CFO. In small- to medium-sized businesses (SMBs), the controller and the CFO may be the same person. This is increasingly true at smaller firms and startups, according to fractional controller Katherine M. “[These businesses] are not seeing the value in paying for a full-time controller over a controller-CFO,” she says. “So essentially, they want to hire a hybrid situation.”
Some of the CFO-level roles a financial controller might take on include:
- Business budgeting and forecasting: Predicting a company’s future financial position based on trends in past financial data
- Financial planning: Using financial forecasts to provide strategic insights and recommendations
- Reporting to stakeholders: Presenting financial data, forecasts and plans to external stakeholders, boards and lenders
- Software rollouts: Implementing procedures and ensuring accurate data migration for accounting systems such as enterprise resource planning (ERP) systems
- Risk evaluation: Identifying and analyzing potential events that may negatively impact the financial position of a company
Equipped with elevated visibility, the controller role is evolving to advise executives through both financial and operational lenses. As technologies like AI transform the analytics landscape, tech-fluent controllers both apply new tools for efficiency and translate resulting insights into actionable strategy recommendations.
Hiring a Financial Controller: Skills and Expertise to Prioritize
A good controller anticipates the information needs of management and provides timely financial data, analysis and recommendations. They absolutely must know the ins and outs of accounting best practices while maintaining technical acumen and strong communication skills.
- Expertise in accounting processes: A financial controller often has 10 or more years of experience in an accounting/auditing firm in addition to an MBA or master’s degree in accounting. They may be a certified public accountant (CPA) or certified management accountant (CMA) with specialized knowledge in auditing and management reporting.
- Expertise in financial planning and analysis: Controllers should “understand how to do financial planning and analysis,” says Katherine. With the rise of automation and data analytics, controllers and controller-CFOs are going beyond routine functions to add strategic value and analysis.
- Expertise in contract and financial covenant analysis: Controllers may review the financial implications of contracts with suppliers, vendors or contractors. They should be able to review financial covenants with lenders to determine optimal terms.
- Expertise in mergers and acquisitions: Controllers often support during M&As in order to aid in system integrations and maintain financial continuity. “In the case of a lot of these companies that do have CFOs, they rely heavily on their controllers to get them through that process,” says Katherine.
- Technical skills: AI and machine learning models have made it possible to advance an accounting team’s functions beyond simple spreadsheets. While controllers don’t need to be experts, they do need to understand how to use the tools to maximize efficiency. Familiarity with business intelligence software, such as Microsoft Power BI, is desirable.
- Leadership skills: A financial controller needs to motivate their accounting team and communicate with stakeholders at the most senior level of a business.
- Communication skills: Controllers often have responsibility for communicating financial data to boards and external stakeholders and lenders. Skill at creating and presenting financial reports will help them perform this function.
When sourcing a full-time or part-time controller, be sure to look beyond someone with only technical accounting knowledge. You should also be searching for someone with the leadership mindset to improve your company’s financial functions. Some questions to ask a potential controller candidate include:
- What are some procedural improvements you’ve made to the accounting team in your previous roles?
- How have you increased revenues/lowered expenses for previous companies you worked for?
- How do you like to communicate financial results to key stakeholders?
- What approach would you take to leading and motivating a team?
When to Hire a Financial Controller for Your Business
Many SMBs initially choose to save money by maintaining a hands-on approach to managing their own finances. However, as the business grows and accounting needs become more complex, it becomes necessary to hire a financial controller to manage the ledgers and ensure full compliance. If your business is experiencing any of the following, it’s time to consider hiring a controller:
- You need strategic finance guidance on expansion moves or investments.
- You need timely data for agile decisions.
- You need to lead a growing accounting team or manage growing compliance and regulatory needs.
- You need support managing inventory, receivables or payables.
- You need tax compliance assurance.
- You need to free leadership bandwidth from accounting functions.
- You need to position your processes and data for automation or AI adoption.
Where to Find an Expert Outsourced Financial Controller
At Paro, we leverage our proprietary AI technology to build flexible, focused teams of remote 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. Request a consultation and get one step closer to gaining the financial controller leadership you need.