If your company has grown rapidly, it needs financial leadership and monitoring from an expert. This person must be a trustworthy individual who can make the right decisions for the organization. You must employ someone who can monitor the accounting and finance policies and procedures, assist with forecast and budget preparations, provide advice on complex tax and compliance matters, and participate in discussions regarding the company’s financial strategies. In other words, you need a financial controller.
Controllers play a crucial role in most companies. They are senior-level accounting and finance professionals who are responsible for directing important financial decisions and determining the company’s financial health and future. To be able to take charge of a company’s fiscal strategies, identify cost-saving opportunities, and evaluate growth, they are required to have exceptional accounting and decision-making skills.
Finance controllers work in the public and private sectors regardless of the industry. Their duties may vary depending on the company’s size. For example, at a smaller firm, the controller manages the business’s financial affairs directly and handles the responsibilities of a financial manager. In larger companies, their duties are dictated by the size of the financial department and the accounting complexity. This role typically requires strong analytical skills since they deal with statistical data.
The responsibilities of a controller differ from that of a CFO (Chief Financial Officer). Although both are finance leaders, they often perform different tasks. A controller is more likely to deal with financial reports, general ledgers, and trial balances delivered to senior executives. Meanwhile, CFOs rely on these reports to shed light on the company’s position.
Employing a financial controller can positively or negatively impact your business. The selection process takes time and requires you to look for specific skills and qualities we’ll discuss in the sections below.
A financial controller must have a relevant educational background. Accounting, finance, or business degrees are necessary academic qualifications. Employers also highly value professional development, so many future controllers often decide to acquire post-degree titles, such as Certified Management Accountant (CMA) or Certified Public Accountant (CPA). Since this is a senior-level position, the focus is primarily on the candidate’s professional experience rather than their academic background.
Most applicants have worked in the finance and accounting departments for several years before applying for a financial controller position. The individuals in these roles must demonstrate leadership abilities and a superior understanding of financial matters. Most financial controllers begin their careers as staff or cost accountants before becoming accounting managers and assistant controllers.
Another essential skill a financial controller must possess is a thorough understanding and hands-on experience in accounting. Individuals typically acquire these skills while working in an accounting company or department. However, senior financial controllers should have a broader perspective on accounting and the ability to view it holistically.
In larger organizations with a CFO, the financial controller spends considerable time doing traditional accounting duties, like closing the books. In contrast, in smaller ones, their role merges with the CFO’s, taking on more strategic responsibilities, such as planning and analyzing the company’s finances.
Along these lines, a controller must understand how accounting departments work. Regardless of the business’ size, they must excel at analyzing numerical data. Mistakes in the financial accounting department can lead to severe monetary and operational implications. Thus, the financial controllers who catch these oversights early on are invaluable to every organization.
Financial controllers must also understand the company’s technology, including hardware and software. They need to be proficient in Excel and databases and understand payroll software, such as QuickBooks or Xero. Spreadsheets are the basis for accountants, as they help controllers understand all that goes into preparing financial statements, reports, and analyses.
Since data is the building block of finance and accounting, database management is a vital skill for every controller. Even though there are many systems (e.g. ERP) that manage calculations, financial controllers must interpret and use the results to make informed strategic decisions.
Additionally, the technological landscape is constantly changing, so they must stay on top of new developments. For instance, the more proficient they become with AI and machine learning in managing the company’s finances, the more valuable they can be to the organization.
Finance and accounting follow external rules and regulations that may result in expensive penalties for noncompliance. And since requirements are frequently changing, financial controllers must always stay on top. Some surround data privacy and protection, while others ensure a company’s financial reporting follows proper reporting and accounting standards.
Companies in Canada use ASPE (Accounting Standards for Private Enterprises) or IFRS (International Financial Reporting Standards) for financial statements. Firms that have business arrangements with US companies must report using GAAP (Generally Accepted Accounting Principles).
As a senior-level executive, a controller is responsible for leading and overseeing the entire accounting department to ensure they accomplish the organization’s overall goals. Anyone who manages and directs a team like this must possess the necessary experience, talent, and strong leadership skills to succeed.
Being an effective manager means having strong communication skills and staying composed under pressure. Financial controllers must be able to explain the meaning and implications of numbers to colleagues with varying degrees of financial expertise. However, since communication is a two-way street, they should also possess good listening skills. Competencies such as these will have a significant impact on the relationships with peers and stakeholders.
Additionally, successful financial controllers are interested in learning how their teams work and listening to their ideas. They also explore what motivates employees and strive to improve their performance, maximize productivity, and help the business grow.
It’s no secret that accounting involves tight deadlines and a great deal of stress. Thus, an effective controller can maintain calm under pressure while still adhering to timelines. Aside from the traits mentioned above, a controller is expected to think critically, be detail-oriented, solve conflicts, and offer cutting-edge solutions.
Recording and reporting data related to financial transactions are just some tasks a controller performs. These individuals should possess a deep understanding of their industry, which will help them add value to the company. For instance, a financial controller who specializes in cost accounting can suggest management changes that can reduce overall expenses in a budget-conscious manner.
Being closely tied to the firm’s finances, they also play an essential role in long-term financial planning, assisting executives with more effective resource allocation. Additionally, when data analysis and financial reporting are used strategically, financial controllers can point out risks, identify trends, and provide recommendations for strategic planning.
Choosing a controller who matches your company culture is crucial. In addition to managing team members, they should also be able to work with other employees. This means being a strong leader is not enough — they should also have the ability to establish rapport with others. As the face of the firm’s accounting department, a controller must be proficient at building and maintaining business relationships both within and outside the company.
Having a controller is crucial to the success of a business. Today’s financial controllers excel at calculating numbers, interpreting data, and using modern financial management software. Furthermore, this position requires expertise, excellent communication and management skills, and technical skills to back them up.
You must also remember that the ideal controller must meet the specific needs of your business and team. Although the above traits provide a starting point for selecting a quality candidate, an ideal controller must ultimately be someone you can trust to make decisions aligned with your organization’s mission.
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This blog is not meant to provide specific advice or opinions regarding the topic(s) discussed above. Should you have a question about your specific situation, please discuss it with your GBA advisor.
GBA LLP is a full-service accounting firm in the Greater Toronto Area, but we primarily service all of Ontario as well as the rest of Canada virtually, except Quebec. Our team of over 30, provides Audits and Reviews of financial statements, and Compilations of financial information, as well as corporate tax returns. We provide specialized corporate tax and succession planning for small and medium businesses, in addition to general advisory services.
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