Controller vs CFO, which one suits your business needs? 

Your business might be growing to the point where it has come time for an investment beyond a regular staff accountant and/or bookkeeper. Perhaps you need someone who can help your company? Prepare for its first audit? Or need someone who can take the time to look at the bigger picture financially for your company? The biggest difference between a controller and Chief Financial Officer (CFO) is what area of focus they cover. Controllers are more for today’s events and day-to-day details. CFOs focus on the future and bigger, broader events.

Controller: Overview 

Controllers, or even accounting managers, usually focus on the day-to-day accounting activities. Such as ensuring tasks for payroll, Accounts Payable (AP), and Accounts Receivable (AR) are recorded correctly and the financial statements are being updated accurately. In smaller businesses, controllers usually operate with a few other individuals on the accounting team. They can take over some of the responsibilities mentioned for CFOs. As companies increase in size, the Controller takes on more of a managerial approach, reviewing work instead of being hands-on and inputting journal entries directly. A controller’s focus is ensuring accuracy and compliance with financial reporting and metrics that your company needs to succeed. Companies of all sizes hire controllers. They tend to be one of the most important hires in understanding financial reporting and where any issues could come from. 

CFO: Overview 

CFOs focus on the bigger picture of budgeting and planning. They are usually found in larger companies as the company expands beyond what a controller might be able to provide or have time for in their role. However, the scope of the work and value provided by a CFO can benefit small businesses, as well. While controllers are normally experts of accounting, CFOs usually have a strong understanding of accounting as well as a finance background to go with it. CFOs are in constant communication with the CEO and other executives.  They work closely with together. Developing long-term financial strategies and address risk management. CFOs are added to the financial/accounting picture once these responsibilities and tasks either become too much for the controller to handle or there is a need for them in the company’s long-term plans.

Moving Forward

This is just a general overview of differences between controllers and CFOs. If you have a new financial vision for your small business, we would be happy to assist.  We specialize in helping owners achieve their goals. Providing both Controller and Virtual CFOs for your business needs. 

Contributed by: Amanda Dunning

Debunking Myths: Why Not Outsourcing Your Accounting Is a Missed Opportunity

As businesses evolve, the complexities of handling financials internally can become overwhelming. Despite the apparent advantages of outsourcing your accounting, many decision-makers hesitate due to certain prevailing misconceptions. Let’s dive into these misconceptions and shed some light on the realities. 

Debunking Common Misconceptions About Outsourcing Accounting

 1. “I’d be relinquishing control over my finances.”

Fear of losing control: The thought is that by outsourcing, one might be handing over too much power and could be kept in the dark about their own finances. 

Reality Check: Outsourcing is about collaboration. You’re delegating tasks, but you remain in the driver’s seat, making informed decisions. You’re merely lightening your workload, not surrendering control. 

 2. “What if they mess up.”

Concern over reliability: There’s a belief that an external team might make mistakes, leaving the primary business responsible for cleaning up. 

Reality Check: Established accounting firms prioritize precision and reliability. Their reputation hinges on delivering quality work. 

3. “Outsourcing seems cost prohibitive.”

Misconception about cost: The presumption is that outsourcing accounting will cost an arm and a leg. 

Reality Check: While there’s a cost involved, the potential returns in terms of time efficiency, error reduction, and insightful expertise are substantial. 

 4. “External parties might breach our confidentiality.”

Concerns over privacy: Some business leaders fear sharing sensitive financial data with external entities. 

Reality Check: Any reputable accounting firm has stringent confidentiality policies in place. They’re committed to safeguarding client information. 

Wrapping Up the Discussion

Having dissected these common reasons for not outsourcing your accounting functions, it becomes evident that many of these concerns might be unfounded. Embracing external expertise can pave the way for more streamlined operations and informed financial decision-making. 

Looking to shift your focus to growing the business? Virtual CFO provides GovCon-centric strategic accounting for small businesses providing services in technology, architecture, engineering, aerospace, and project management industries.   

We know your pain points – let us help you relieve them – schedule a consult.  

Cash Management

As a business owner, you truly have an understanding of the saying ‘cash is king.’ Cash is the lifeline of any business. It is a vital component, ultimately impacting a business’s financial stability and success. Without it, your business cannot survive. Although, running a small business comes with a myriad of challenges. One of the most critical aspects that can significantly impact its success is its cash management.

What is Cash Management

Cash management in layman’s terms is how a business manages its cash flow. It is the process of monitoring, optimizing, and controlling the cash within your business. Its goal is to ensure a business has the right amount of cash on hand to cover its operational expenses and to optimize growth opportunities. Effective cash management is like the beating heart of a business. It makes sure the business is not only running smoothly but thriving as well. Without a proper system in place, a business may find itself in a dire situation.

Why Cash Management is Important

Proper cash management is the foundation for a small business’s financial health and growth. There are many reasons it holds immense importance for businesses. First, it helps to create financial stability. It safeguards your business against unexpected expenses and events, like economic downturns. With a financial safety net, your business is better prepared to weather challenges. Also, it helps to seize growth opportunities. Having cash on hand helps businesses make strategic decisions. Lastly, it aids in the process of decision making. Informed decisions rely on accurate financial data. It provides the data you need to make strategic choices for your business.

How a Virtual CFO Can Help

Virtual CFO’s expertise allows them to wear many different ‘hats.’ They play an essential role in helping businesses manage their cash. A virtual CFO provides valuable insight for cash management in many ways. For example, virtual CFOs analyze your business’s historical cash flow data and uses it to create accurate cash flow forecasts. This helps a business prepare for the many financial challenges. A virtual CFO can provide regular financial reports and analysis. This allows a business to monitor its cash position which helps to make better decisions and adjust strategies if needed.

Cash management can be one of the most challenging aspects of a business but it is fundamental to the overall success of your business. While it may not be everyone’s forte, it is ours. Let the CJA team help you with your cash management needs!

Contributed by Elizabeth Partlow