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When to Hire an Accountant vs CFO vs Controller

As a business owner, it’s cause for celebration when you find yourself wondering whether to hire an accountant, a CFO or an accounting controller. The need to fill this role means your business has grown to a new level of revenue that requires you to reconsider how you’re handling your financial reporting.

To determine whether your business needs an accountant, a CFO or an accounting controller, you need to understand what each professional can do for you. Learn about the duties associated with each of the positions to determine which one is right for your company.

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What is an accountant?

An accountant is responsible for managing and interpreting financial records for either an individual or a business. As an employer, you may consider outsourcing your financial management to an accountant with their own practice, or you can hire an accounting team to handle your finances internally.

The duties of an accountant include:

  • Analyzing data
  • Generating finance reports
  • Creating and managing budgets
  • Filing tax returns
  • Managing accounting records
  • Processing payroll

Accountants are responsible for handling their client’s current financial reports and providing forecasts on future financial trends.

What is a CFO?

A CFO is a Chief Financial Officer. This person is an employee of a company who is usually in a senior management position. They’re responsible for overseeing the financial activities of the entire business, rather than tracking the day-to-day expenses.

The duties of a CFO include:

  • Tracking cash flow
  • Financial planning
  • Analyzing the company’s financial strengths and identifying weak areas
  • Suggesting solutions to financial problems

A CFO is a C-level position, usually reporting directly to the CEO or working closely alongside them.

What is an accounting controller?

An accounting controller oversees the daily accounting operations of a company. This includes overseeing the payroll, accounts payable and accounts receivable departments.

The duties of an accounting controller include:

  • Managing accounting staff
  • Maintaining accounting records
  • Overseeing payroll and taxes
  • Coordinating audits
  • Reconciling financial accounts

Does my business need an accountant, a CFO or a controller?

The type of financial employee your business should hire depends on several factors. The biggest consideration when hiring for these roles is the size of your business. In some cases, you may need to hire more than one employee to fulfill all three roles in your company.

When to hire an accountant

Hiring an accountant for a small business is an exciting step that means your operations are growing. You should consider hiring a full-time accountant if you need assistance with collection, analysis and financial reporting.

When your business is bringing in significant amounts of revenue, an accountant can help you manage your bookkeeping and taxes to ensure your transactions are accurately recorded. When your financial tracking is transparent, it makes it easier for stakeholders to understand your business’ performance.

Even if your small business has just one or two employees, it’s still essential to hire an accounting professional if you don’t have a solid understanding of deductible expenses, accounting for inventory and depreciation. A certified accountant can help you avoid costly mistakes.

When to hire an accounting controller

An accounting controller can be beneficial for businesses that are expanding and require more than one accountant or bookkeeper to track their finances. This person is a senior-level executive who takes on the managerial role of overseeing the accounting department.

If your company is bringing in between $1 million and $10 million per year, you might consider hiring an accounting controller, rather than a CFO. At this stage of the company’s development, it makes sense to bring in a controller who can oversee your accountant(s), manage your bookkeepers and perform the basic responsibilities of a CFO while reporting to the CEO.

When to hire a CFO

A CFO helps a company navigate its financial path. This management role is responsible for the big picture aspect of the business revenue. Some startups decide to bring a CFO into the mix from the onset for strategic financial insight and assistance with creating budgets and projections, as well as managing cash flow.

However, hiring a CFO in-house is traditionally not worthwhile until your company is bringing in at least $50 million in annual revenue. At that point, paying a CFO’s salary is beneficial because of the expertise they bring to the business.

If you reach a point where your business can comfortably sustain revenue of over $10 million per year but aren’t yet at $50 million, consider outsourcing a CFO.

When to hire an accountant vs CFO vs controller FAQs

What is the difference between a controller vs an accounting manager?

Although an accounting controller and accounting manager have similar roles, their responsibilities within the company differ. An accounting manager is involved in the management of a company’s finances and deals more with people, rather than performing a technical function. An accounting controller is more intimately involved with the accounting function and financial reporting of a business. Understand the duties of both roles to decide whether you need an accounting manager vs controller.

Who does an accountant report to?

A corporate accountant typically reports to the accounting controller or financial manager of the company. If you outsource an accountant for a small business, they likely own the firm and do not report to any superiors.

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