
What is a good profit margin?
What is a good profit margin? Anotoine de Saint-Exupery once famously said, “A goal without a plan is just a wish.” This statement has held
The accounting world has many different rules and requirements. From accrual accounting to full absorption to revenue recognition, these rules can be overwhelming. Within the accounting industry, there are different levels of accountants, from bookkeepers to controllers to Chief Financial Officers (CFO).
These different rules and levels can be confusing to most, even accountants who live and breathe this lifestyle. For the business owner, understanding the accounting rules and levels can be even more stressful when they need help with their financials. In this post, we are going to discuss the financial controller.
What is a controller, what do they do, and when a business owner should hire one?
A controller is an experienced accountant who manages the accounting staff of a company. They coordinate and verify the accuracy of the financial statements. They are proactive in the financial aspects of a company, particularly in budgeting and forecasting.
A controller will usually have a college degree in accounting. They will be well versed in the accounting rules. Many controllers will have certifications, such as Certified Public Accountant (CPA), Certified Managerial Accountant (CMA), or special certifications in a particular industry such as construction.
The Controller will usually have more qualifications than the accounting staff they manage.
The controller can best be thought of as the management layer between the Chief Financial Officer (CFO) and the staff accountants. At their position, they will focus on:
Most larger businesses have both a financial controller and a CFO. But at what level should a small business consider hiring a controller? Common factors to use when deciding to bring in a controller:
The cost of an accounting controller can vary by geographic location. On average, a controller will command a salary between $51,000 – $133,00 per year plus benefits. Benefits usually run around 24% of salary, so after benefits the cash out will be in excess of 6-figures.
This should not be considered an expense, but rather an investment in the financial health of the company. Their experience will protect the business from missed opportunities plus protect the company’s financial data.
An alternative to a fulltime controller is to hire a virtual controller. The technological advances allow accessing a virtual controller easier than ever. A virtual controller, or an outsourced controller, will usually work on a set monthly fee.
They will work part time for the company, but still bring in all the management aspects a full-time controller. An additional benefit is the company will not be limited to the local labor pool.
A virtual controller can work from anywhere in the U.S. and, usually, has credentials and experience above what the local labor pool can offer. The cost will usually run around $3,400 per month, or approximately $40,000 per year.
As an additional cost savings to the Company, this type of arraignment does not require payments for benefits that are incurred with full-time employees.
If the company is trying to decide if they need to hire a controller, consider
Going through these questions plus looking at the company’s long-term goals will make the decision process easier and logical.
Whether the company wants to go with a fulltime or virtual controller, the cost should always be considered an investment to get the business to the next level.
What is a good profit margin? Anotoine de Saint-Exupery once famously said, “A goal without a plan is just a wish.” This statement has held
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