When to Hire a Controller:
No Time: An established business with a solid management team will want to focus more on the bigger strategic issues and hire a controller to manage the day-to-day budget and financial operations. Changing Financial Software: There comes a point in the growth of a business when a simple off-the-shelf accounting software program no longer will do. Your small business accounting team can add a controller not only to manage your financials but to help select an appropriate financial software system. Bring Financials In-House: As a small business owner, you may decide to rely less on an accountant and focus on hiring a controller to have a full-time management member to run the daily operating budgets, receivables, and financials. When to Hire a CFO:
Company Expansion Stage: Businesses experiencing rapid growth or planning a major expansion can benefit from adding a CFO to their small business accounting team. A CFO can provide strategic advice to companies adding multiple product lines and requiring financial management of complex issues. Advanced Financing: Simply applying for a new business credit line at the bank will not require the expertise of a CFO. However, if you are planning an Initial Public Offering (IPO), or more complex money raising tactics, then a CFO can add value to your small business accounting team. It isn't a matter of reaching a specific revenue number that facilitates the need for a CFO but the requirement of dealing with outside investors. Add a Temp CFO to Your Small Business Accounting Team
Many small businesses will never be able to afford the $250,000 salary of a full-time CFO. An attractive alternative for many cash strapped small businesses is to hire a temp CFO. Companies such as CFO Associates provide growing businesses with the advice from a CFO on an "as needed" basis. Jerry Charlup, Managing Director of CFO Associates says, "Most of my clients come to me when a third party has asked them for more sophisticated financial information than they are used to providing. Usually, the third party is a lender or investor."
The decision to build a small business accounting team depends upon the aspirations of the business owner. If you operate a one-person, unincorporated business with simple transactions and have a basic understanding of record keeping then a financial accounting software program will do. Remember, many businesses fail due to a lack of understanding financials and money management. Be honest with yourself. A glossary brochure may be less important than financial advice from a professional.
