In Pursuit of Profit
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The role you need depends on your business needs, so let’s look at common business triggers that most likely require needing the next level of financial role, and what kind of activities and responsibilities each role typically includes. We’ll start with bookkeeper and work our way up to Chief Financial Officer (CFO).
If you’re starting up your business or you’re tapped out on trying to do your own accounting for your small business, you likely need a Bookkeeper!
If you’re starting a new business or have an existing business and you’ve outgrown using your bank account and spreadsheets to track your financial transactions, then it’s time to hire a bookkeeper. Most likely you would start with a fractional bookkeeper (not full time), paired with a CPA Firm that can advise on taxes and recording more complex transactions such as debt and equity. Your financial transactions should be reviewed by your CPA Firm, an owner, or a fractional Controller or CFO. A bookkeeper often has an AA degree or less.
A Bookkeeper will typically handle the following:
If your business is growing in size and complexity, and your bank or investors are asking for more than a P&L statement, you likely need a degreed Accountant, Staff to Senior Level.
When your business is growing and your bank or your investors want financial statements that are GAAP (Generally Accepted Accounting Principles) compliant financials instead of cash basis financials, you will need an accountant. However, an Accountant still needs oversight and guidance, and their work needs to be reviewed by another qualified person if the financials are being sent to an external user. The qualified reviewer may be an owner, a fractional or full-time Controller or CFO depending on your size, or possibly a CPA Firm. An Accountant has a BA degree in accounting and may have a CPA.
The difference between Staff and Senior accountants is typically the number of years of experience – often an accountant will move up from Staff to Senior accountant over time, or it may also mean a promotion to Senior accountant once a BA degree or CPA is earned.
In addition to the above, an accountant can provide the following:
In summary, bookkeepers primarily focus on recording transactions and maintaining accurate financial records, whereas accountants have a broader role that includes analyzing data, preparing complex reports, providing insights, and supporting decision-making. The distinction between the two roles lies in the level of responsibility, analysis, and expertise required.
If with your growth, you are hiring more people to process a high volume of transactions and need someone to oversee the team, then you likely need an Accounting Manager!
When you have more than two to three people in accounting processing your transactions, they likely need oversight and guidance. An Accounting manager oversees multiple accountants and bookkeepers. There are two types of Accounting Managers:
An Accounting Manager is a go-to person for the business owner. They know more, at a higher level, than the other accountants on the team.
An Accounting Manager will typically handle the following:
If your business is very complex, operating in multiple states, multiple entities, multiple lines of business and you need someone to oversee your growing accounting department and manage risk, then you likely need a Controller!
Because your business is becoming more complex, your accounting, reporting, tax and compliance needs are as well. The bank or investors may want more oversight of your accounting. At this point, you should be working with a solid CPA firm on tax strategy and compliance, as well performing an audit or compliance review which may be required by your bank or investors. Internal controls as well as formalized processes and procedures become more important at this stage, which means you may need a Controller to supervise and lead your accounting team and help with these more complex needs.
If you’re a very large company, you may need a Controller. If you’re a smaller business that needs someone with a title higher than Controller, you might change the title to Director of Finance or Director of Accounting. Controllers often have a BA and CPA and may have started their career in a CPA firm.
A Controller will typically handle the following:
In summary, the Controller role is often more focused on assisting with the overall financial management and control of the organization, while the Accounting Manager's role is more hands-on, involving direct oversight of the accounting team and the daily accounting processes. Both roles contribute to the accurate and efficient operation of the accounting department. The specific responsibilities and scope of these roles can vary based on the organization's size, structure, and industry.
Chief Financial Officer (CFO)
If your business is very complex, operating in multiple states, multiple entities, multiple lines of business and you need someone to help you strategize and plan for the future, then you likely need a CFO!
A CFO is integral when you have a solid accounting team that is handling everything, but you need someone in your court to bounce ideas off, strategize about the future of your business and operations, or maybe help you decide if merging, acquiring or selling your business is a good idea. Most often a CFO will have started their career in public accounting and moved into a Controller role, and then will have been mentored by a CFO who may be retiring or leaving and take over as a new CFO.
A CFO will typically handle the following:
In summary, while both the CFO and Controller have key financial responsibilities, the role of the CFO is more strategic, focusing on shaping the organization's financial direction and interacting with stakeholders, while the Controller's role is more operational, ensuring accuracy, compliance, and effective financial management on a day-to-day basis.
Keep in mind that with all these positions you can always start with someone fractionally or part time and develop that role into a full-time position as your business grows. If you need bookkeeping services or a part-time accountant, The ASP Team has a team of experienced accountants to help. On the management side of things, if you need a fractional controller or consulting CFO, the CFO Selections team has extensive experience to offer. Both companies offer the customized accounting and finance solutions needed to meet your business where it is at any stage and help it grow to the next level.
About the Author
At CFO Selections, Jen focuses on helping businesses succeed and grow by matching each company’s unique financial needs with the right resources and solutions.
Jen has more than 25 years of professional services experience focused primarily on consulting, client service, engagement management, and talent acquisition. She has served clients ranging from startups to those in extensive growth stages, and those experiencing M&A transactions. Her industry focus has included technology, real estate, construction, transportation, manufacturing, and distribution.