Did the Pandemic Make Hiring a Financial Controller a Necessity?

We see a variety of circumstances in our practice at ASP, whether it be outsourced consulting needs, or an organization growing and needing to consider a fulltime resource. Our recruiting efforts are responding to those fulltime needs daily. The pandemic has shifted the business landscape significantly, making strong financial leadership universally important.
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Small companies that previously had their CEO at the helm of financial operations have realized that they need a fulltime controller to oversee their accounting operations and staff. With the increased demands of operating during financially uncertain times, CEOs need to focus on their core role of running the company overall (pivoting and shifting as needed), while entrusting another professional with the financial management of the company.

As a result, hiring a fulltime controller is no longer optional these days with the following business trends occurring:

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Financial Uncertainty
With an uncertainty abounding, companies are looking for ways to be more efficient with the resources that they have. To do this they need to understand their cash flow position, revenue drivers, cost of goods, materials waste, and excess capacity.

In fact, the team at CFO Selections lists “regularly assessing the health of your business using KPIs and other valuable metrics” through data analysis as one of the top tips for weathering a recession. Accurate accounting procedures and financial analyses are instrumental in optimizing these areas to maintain profitability and encourage resilience no matter what is coming next.

Unlike an accountant or finance analyst that may have a more siloed view, a controller can also look at the bigger picture to determine where unnecessary expenses exist across the company that can be cut. The goal is to avoid making cuts that could hurt future growth potential and preserve the most lucrative areas of the company when cuts must be made.

Additional Work
In the face of financial uncertainty there is just simply more work to be done these days.

Companies that were previously conducting financial analyses on a monthly or quarterly basis are not doing the same analyses on a weekly or even daily basis. The result is an increased burden on accounting and finance staff that has left most in the weeds for more than a year now.

Multiple-scenario financial planning is also on the rise. Companies are developing more financial forecast scenarios and updating them more often. While updating financial forecasts a couple times a year used to be the norm, many businesses are now updating them monthly, putting additional strain on financial personnel.

Adapting forecast models is crucial to anticipating what is coming next this year and beyond because it enables the company to realign expectations as scenarios play out. However, without hiring a senior accountant or controller, financial planning may not occur as often as necessary or with the same depth of analysis.

Remote Work
Having employees work remotely increases the risk of fraud, which necessitates increased oversight of bookkeepers and accountants.
As our team explained in an article about remote work challenges last year,

When employees are spread out, organizations tend to consolidate functions to improve efficiency, but in the case of accounting controls, that can be a dangerous decision. Fraud risk is higher when it can be done in a “faceless” environment (like through an online bank transfer instead of taking money from a cash register drawer) and when employees do not think someone is watching. Both of these criteria are met in a remote environment, putting employers in an especially vulnerable position.

CEOs cannot be responsible for updating and overseeing financial controls to mitigate fraud potential because they have too much else to do.

Employee Burnout
The combination of increased business needs and “always-available” remote work expectations is leaving many employees burnt out, especially in finance and accounting roles. Hiring a controller can combat that by removing more time-consuming strategic planning activities from accountants’ plates, freeing them up to do the more hands-on work required for their roles.

Downsizing
If downsizing is necessary, a controller can oversee the process from a financial perspective – taking into consideration the full monetary cost and tax implications of laying off employees, discontinuing products, closing locations, reducing service areas, and/or canceling contracts. If you end up needing to close or sell the business, a fractional controller can also oversee the process needed to cease operations at a fraction of the cost of hiring a short-term CFO.

Transitional periods require the specialized expertise of an experienced financial professional. Let our accounting recruiters help you hire a controller to navigate these uncertain times and prepare your company for success in the boom that is coming next.