A Controller oversees a company’s accounting function, including financial reporting, internal controls, budgeting, forecasting, and review of the accounting team’s work.
When deciding whether or not your business could benefit from a Controller, your first question is likely, “What does a Controller do?” Since a Controller can help you as your company’s finances grow and become more complex, it’s important to understand this role.
A Controller is a high-level manager responsible for overseeing the financial operations of a company. They are part of the leadership team and play a key role in ensuring the business stays on track financially. Controllers are often added as accounting needs become more complex, and they may manage accounting systems and financial reports.
WHAT DOES A CONTROLLER DO? RESPONSIBILITIES AND JOB DESCRIPTION
Controllers are responsible for providing oversight and management to the organization’s financial reporting, budgeting, forecasting, accounting processes, and other financial activities. Additionally, Controllers may be called upon to manage the organization’s cash flow. Controllers are also responsible for measuring performance against budgeted targets and providing advice regarding operational risks or opportunities.
Financial Reporting and Accounting Oversight
Your Controller should not be doing data entry. Controller duties involve managing the accounting department from a high level. Compared to your Bookkeeper, Staff Accountant, and/or Accounting Manager, the Controller is focused on ensuring the accuracy of the financial statements. Controllers also take financial information, interpret the results, and communicate them to management and non-accountants in a way they can understand. A Controller will also suggest improvements to achieve the business’s goals. Financial Controllers often report to the Chief Financial Officer (CFO). Their day-to-day duties include preparing operating budgets, overseeing financial reporting, and overseeing accounting processes that may include payroll.
Telling the Story Through Financial Data
The most important job of a Controller is to “tell the story” of what’s going on in the business. They communicate that story through graphs, charts, and pictures to show where the business is and where it can go. To do this successfully, the Controller must thoroughly understand the business’s goals so they can determine which aspects of the financial package to highlight. The Controller will focus on Key Performance Indicators (KPIs) and ratio analysis, including gross profit metrics.
Internal Controls and Risk
The Controller also oversees internal controls and helps establish controls designed to reduce financial risk and the opportunity for fraud. They create and prepare internal control procedures for both the financial and accounting departments. Controllers reduce risk through strong accounting processes, appropriate reporting, and asset safeguarding. The strategies the Controller creates to minimize financial risk are based on the business’s goals.
Accounting Team Management
In many accounting departments, the Controller will report to the CFO. They will also manage and support the Accounting Manager and hold them accountable for producing accurate and timely financial information. The data must be accurate in order for the Controller to analyze it and fulfill their job responsibilities. Once the Controller has signed off on the financial package, they can use it with the CFO and other financial leaders to communicate results to management and key business stakeholders.
TYPES OF CONTROLLERS
Perhaps more important than the question, What is a Controller, is what types of Controllers are available for your business. In reality, Controllers can take on different roles depending on the business’s needs. While they all focus on managing financial operations, some bring specialized expertise based on industry or company structure.
The answer to the question, “What is a Controller in business?” varies from industry to industry.
Corporate Controller: A Corporate Controller oversees the entire accounting function of a business. They manage financial reporting, and maintain internal controls. This role is common in mid-sized to large companies.
Divisional or Regional Controller: These Controllers focus on localized financial performance and reporting while still following the company’s overall financial policies.
Plant or Manufacturing Controller: As we continue to define a Controller in accounting, we should also comment on plant or manufacturing Controllers. These Controllers are typically found in businesses that produce physical goods. They specialize in cost accounting, inventory control, and efficiency tracking related to production processes.
Project Controller: A project Controller is usually found in industries with large, complex projects like construction, engineering, or software development. They monitor project budgets, timelines, and financial performance to keep things on track.
Understanding which type of Controller best fits your business can help ensure your financial operations are properly managed as your company grows.
WHAT SKILLS AND QUALIFICATIONS SHOULD A CONTROLLER HAVE?
While answering the question “What does a Controller do?” is pivotal to solidifying their role, understanding their experience is equally important because it reflects on their performance within your business. Here are key qualifications and skills to look for in a Controller:
- Strong analytical ability to evaluate financial data and identify trends or problems.
- Attention to detail to ensure accuracy in financial reporting and compliance with regulations and accounting processes.
- Effective communication skills to explain financial information clearly to others.
- Leadership skills to manage and motivate an accounting team.
- Knowledge of accounting standards and the financial requirements relevant to the business.
These key points highlight a Controller job description and what to look for when hiring the right professional for your business. Additionally, look for someone with extensive experience in accounting and finance. A Controller should know Generally Accepted Accounting Principles (GAAP) and have expertise in budgeting, forecasting, financial analysis, and financial reporting. If you need them to manage your accounting team, they should have strong leadership skills and be comfortable working in a fast-paced environment.
Educational and credential requirements vary by company. Many employers look for a bachelor’s degree in Accounting, Finance, or a related field, while credentials such as CPA or CMA may also be valuable depending on the position’s responsibilities. Relevant experience with accounting systems, reporting, and team management should also factor into the hiring decision.
CONTROLLER VS ACCOUNTING MANAGER VS CFO
Controllers and CFOs both oversee the financial operations of an organization, however their roles are very different. The responsibilities of a Controller typically include accounting, payable/receivable, payroll, oversight, financial reporting, budgeting, and cash flow management. In contrast, a CFO (Chief Financial Officer) is involved in higher level decisions such as strategic planning, capital investments, and mergers/acquisitions. A CFO will be more involved in the company’s overall performance and financial strategy than a Controller would be.
Another distinction to make in hiring is between an Accounting Manager vs Controller. An Accounting Manager is responsible for managing the daily activities of an organization’s accounting department. They may oversee bookkeepers, accounts payable/receivable clerks, payroll staff and other individuals within the department. An Accounting Manager will typically report to a Controller or CFO, and they are not responsible for higher-level tasks such as strategic or capital planning. The Controller adds another layer of review, interpretation, and financial oversight above those daily accounting responsibilities.
WHEN DOES A BUSINESS NEED A CONTROLLER?
Ultimately, the role of the Controller is to ensure that the business’s financial activities and financial reporting are carried out in an efficient and accurate manner. The risks of not having enough financial oversight include the potential for financial mismanagement, inaccurate reporting, and inadequate forecasting. Without the appropriate level of review and guidance, errors or reporting issues may be harder to identify and address.
A business with complex accounting requirements may find it beneficial to have either a full-time or fractional Controller.
Controller-level support may also become useful when a growing accounting team needs more review, financial reporting requires deeper interpretation, budgeting or forecasting becomes more complex, or leadership is spending too much time trying to understand the numbers without enough financial context.
FRACTIONAL CONTROLLER VS. FULL-TIME CONTROLLER: WHAT’S RIGHT FOR YOU?
Whether you need a fractional or full-time Controller in accounting depends on your company’s size, complexity, and financial goals.
A fractional Controller is a part-time financial expert who works with your business on an as-needed basis. This is a good option for companies that don’t yet require full-time financial oversight but still need help with things like closing the books, reviewing financial reports, or implementing new systems. Fractional Controllers often work remotely and bring a flexible, scalable solution.
A full-time Controller is best for companies with more complex financial needs. These businesses often have multiple revenue streams, a larger accounting team, or require regular oversight of budgets and forecasts. A full-time Controller is deeply involved in the day-to-day operations and is often a key player in ongoing accounting oversight and financial reporting.
Choosing between the two comes down to where your business is today and where you want it to go. If your accounting needs are starting to grow but don’t yet justify a full-time hire, a fractional Controller can fill the gap. As your company scales, bringing on a full-time Controller can add structure and consistency to your financial operations.
FAQS ABOUT WHAT DOES A CONTROLLER DO
Do Controllers make a lot of money?
Controllers typically earn a competitive salary, which can vary based on factors such as location, industry, and experience. On average, they can make anywhere from $80,000 to over $150,000 per year.
What is the career path for a Controller?
Many Controllers start as accountants or financial analysts before advancing to managerial roles. With experience, Controllers can move up to positions like CFO or other senior executive roles within the finance department.
Do Controllers help with tax planning or filings?
While a controller job entails maintaining accurate financial records, they typically do not handle tax planning or prepare tax returns. However, they play a key role in organizing the financial data needed by tax professionals and ensuring that the company stays compliant with tax regulations.
What software do Controllers commonly use?
Controllers often use a combination of accounting and financial management software. Common platforms include NetSuite, QuickBooks Enterprise, Sage Intacct, and other ERP systems. They may also use Excel, budgeting tools, and data visualization software to analyze financial data and generate reports.
Is a Controller above a VP of Finance?
No, a controller is typically not above a VP of Finance. The VP of Finance often holds a higher-ranking position and focuses on broader financial strategy, investor relations, and long-term planning. If there’s any confusion over the question, what is a controller in accounting, remember this: Controllers usually report to the CFO or VP of Finance and are responsible for managing day-to-day accounting operations and financial reporting.
Are Controllers considered executives?
Controllers are often part of the leadership team, but whether they are considered executives depends on the organization. In some companies, especially smaller ones, the controller may be seen as an executive due to their high-level responsibilities and involvement in decision-making. In larger organizations, they are usually viewed as senior managers reporting to the CFO.
This post was reviewed by our team of accounting and financial experts. TGG’s mission is to make business owners’ lives better through excellent financial management. We strive to provide the most up-to-date and objective information on accounting-related topics so our readers can make informed decisions based on factual content. All posts undergo a review process with at least one member of our Leadership Team to ensure accuracy.
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Matt Garrett is the Founder and Chief Executive Officer of TGG. He is a regular speaker across the country on behalf of Vistage educating business owners on the need for sound financial practices, and is Vice President of the Board of Directors of FINACA. Under Matt’s leadership, TGG has received the following recognition: INC. 5000 top companies in the U.S. five years in a row; one of “San Diego’s Fastest Growing Companies” the past four years; and is among San Diego’s “Best Places to Work.”