When do you need a financial controller for your business? A guide for startups

For some startup founders and CFOs, delegating accounting work to a financial controller represents an exciting time for the business. 

That’s because the hire of a financial controller signifies sustained and increasing growth. Bringing one onboard can unlock new opportunities for your startup.

The financial controller’s work involves every aspect of the business, from tax strategy and expense management to marketing budgets, hiring, firing, and other core functions. But when is the right time for your business to make this strategic hire? 

You’re in the right place if you’re wondering when a financial controller will become necessary for your growing startup. This guide will unpack the following questions you should ask yourself when planning to start your candidate search.

What is a financial controller? 

A financial controller holds an influential role in the finance department of a business. They are responsible for the accounting tasks that keep the company moving forward and in the right direction. 

If a financial controller is good at their job, you can expect many operational aspects of your business to run smoothly. Payroll goes out on time, taxes are filed compliantly, budgets are reconciled accurately, and spending remains under control. 

Why do you need a financial controller?

It should be high on the founder’s priority list to hire a capable financial controller as soon as the company budget can sustain it. Why? Because a capable financial controller is a major asset to a startup.

Many financial controllers you will encounter during the talent search will have experience overseeing a staff to support larger startups and SMBs. But startups should hire their first one before they reach a large size. 

Businesses just getting their start often choose to hire a financial controller to perform all necessary accounting work, from taxes to payroll. 

Even if your startup is under 10 people, a financial controller can bring immediate value to your business. Financial controllers can take over many of the laborious but essential tasks currently on the CFO’s agenda — for example, reviewing spending proposals and budgets for viability or managing cash flow to keep the startup in a strong position. 

What are the advantages of hiring a financial controller? 

The top 6 advantages of hiring a financial controller are: 

1. Accuracy: Delivering always-exact financial statements and reconciliations is a top priority of the financial controller. 
2. Data access: The financial controller can help guide the business toward the decisions most likely to strengthen the bottom line. 
3. Strong relationships: By ensuring on-time payments to vendors, partners, employees, and contractors, the financial controller fosters valuable connections that benefit your business. 
4. Clean audits: With an organized, well-documented accounting department to back you up, you can go through audits and due diligence without breaking a sweat. 
5. Tax and employment law compliance: Staying on top of tax and employment law is challenging, but the financial controller makes sure payroll, tax filings, and withholdings are accurate in partnership with your CPA team.
6. Stronger focus: When you, the CFO or CEO, can get out of the weeds with financial matters, you can focus on your most important responsibilities — such as growing the business. 

Role and responsibilities of a financial controller 

The following list of responsibilities can help you concretely define how the financial controller role will contribute value to your organization: 

• Maintain up-to-date, readily accessible financial records 
• Create, administer, and reconcile company and department budgets 
• Manage accounts receivable and payable, the general ledger, revenue recognition, and other standard accounting operations 
• Monitor cash flow and maintain liquidity 
• Collaborate with tax professionals and accountants to implement compliant tax strategies
• Generate monthly financial reports and statements for leadership, shareholders, investors, and other stakeholders
• Develop standard accounting procedures to generate process efficiencies
• Hire and manage accounting staff 

Consider browsing through existing job descriptions on LinkedIn when figuring out how to position your job listing for a financial controller. Understand how other companies in similar industries are approaching this hire to help you gain inspiration.

Keep the tasks and responsibilities you need; nix the ones you don’t. 

When does it make sense to hire a financial controller? 

When determining when it makes the most sense to onboard a financial controller, consider the problems someone in this role can solve — and compare where your business currently stands with respect to these issues. 

When the business is expanding quickly:

Generally speaking, your startup is likely on a growth trajectory. If you are growing very quickly — you can’t staff your team quickly enough to keep up with demand, for example — consider getting a financial controller onboarded sooner than later. 

They will help you develop and implement consistent, scalable systems to stay on top of the accounting backlog. The financial controller can also help protect your company from the easy mistakes that cost you money, such as incorrect tax filings, misclassified expenses, or redundant purchases. 

Before you’re behind on updating financial reports: 

Between investor pitches, board meetings, and strategic planning sessions, CEOs and CFOs must prioritize keeping company financial information. And this data shouldn’t only be ready for these key deadlines: they ought to always be accessible. You will need this information increasingly often as the business grows. 

The accuracy of these figures is also critical. A financial controller will put systems in place that ensure precision — and should build your investors’ confidence. 

When you realize fraud presents tangible risks to your business:

Spreadsheets are a versatile tool. But as a chief officer of a business, you are a target for hackers and fraudsters eager to get their hands on sensitive assets and data. 

In this case, spreadsheets are no longer suitable for important financial information. 

Data governance is a major concern for startups. It is up to you to keep your assets out of the wrong hands. An experienced financial controller will implement the best possible data security and privacy practices, giving you peace of mind for the longevity of your business. 

Before your accountant and CFO become completely overwhelmed:

The financial controller allows your tax accountant and your CFO to thrive in their roles. 

As a CFO liaison, the financial controller delivers consistent access to updated financial statements and reports. By taking their day-to-day out of the tasks required to maintain this information, CFOs are liberated — and can focus on the high-level financial strategy work they were hired to do. 

The financial controller is also a bridge to the CPA, who ought to remain focused on tax-related systems and deliverables and not broader company financial planning. The accountant should not be the only voice advising the business on tax strategy, either, as the financial controller has direct insight into the organization’s inner workings, which can be a valuable aid to tax professionals. 

What to look for when hiring your first financial controller

When hiring your startup’s first financial controller, seek candidates with a blend of hard skills and management experience. You will probably also want someone who can embrace unpredictability — and create order from the early systems they inherit when stepping into the role. 

Finding a financial controller with in-depth industry and startup experience is a good idea. The level of experience you can get will depend on the salary and benefits you can afford to offer. 

At a minimum, ensure they are willing to develop creative solutions, onboard financial software, and new team members, and build close-knit relationships in service of the organization’s financial health. If you do, you should be able to make the most of this hire — and help your business thrive over the long run.