Table of Contents
Key Takeaways
- Financial controller goals cover a lot of ground in financial management, ranging from reporting to risk management and forecasting.
- Collecting data, generating reports, and analyzing them are some of the most important aspects of the controller role.
- Controllers provide the necessary oversight and data collection to help CFOs make well-informed decisions.
Controllers are drivers in business today. Financial data is richer than ever, and financial professionals across the board are expected to be more than data-driven. Business acumen, narrative analysis of data, and high-level leadership are now essential for today’s controllers.
These trends have been coming to a head for at least a decade. An oft-cited Ernst and Young report showed wide agreement that the role of controllers was poised for a broadening that would turn it into a driver of business. The fact that the financial community still refers to that report is an indication of how spot on its predictions were.
Today, controllers and CFOs drive the business forward together. Controllers are gaining more independence from their CFOs and doing more to support their goals and the financial goals for a business.
What is the goal of a controller?
Finance controllers have multiple objectives: Managing cash flow, financial reporting, risk management, strategy development, and financial management optimization. Controllers must analyze and summarize high-level data to present to the executive team, as well as provide strategies to solve bottlenecks, new risks, and compliance issues.
Finance team goals vs controller goals
For many, it can seem that controller responsibilities overlap with the CFO’s. However, while one professional may take on both roles in a smaller business, they are distinct. CFOs typically oversee a controller’s work, provide expectations, and reports back to the board. Furthermore, a CFO may make strategic decisions while the controller executes these plans.
Financial reporting goals examples
Financial reporting is a critical part of a controller’s job. But this responsibility has its own subset of objectives and responsibilities. Examples of financial reporting goals include:
- Providing information for better decision-making
- Improving transparency and compliance
- Assessing resources, liabilities, and equity
- Establishing a foundation for budgeting and allocating resources
- Setting benchmarks
When drafting financial reports as a controller, keeping these goals in mind is critical to both collecting the correct data and presenting it to stakeholders.
What are the 5 significant roles of a financial controller
Financial reporting isn’t the only responsibility of a financial controller, however. There are 5 primary roles of a financial controller:
- Compliance: Controllers must oversee compliance with accounting standards like GAAP or IFRS, as well as preserve data integrity and work with auditors.
- Forecasting: In addition to compliance, controllers contribute to budget development, scenario planning, and resource optimization to ensure the business meets its objectives.
- Risk management: This role requires a controller to monitor processes for fraud detection and prevention, design an overall internal control framework, and review controls regularly.
- Liquidity management: Monitoring cash flow is a core function of all finance professionals. For controllers, this can look like overseeing payment strategies, developing plans to secure funding such as loans, or maintaining cash reserves.
- Financial planning: Controllers can also expect to take on the role of a financial planner. Performing trend analysis, tracking performance metrics, and evaluating investments are all critical components of the profession.
What are the objectives of a controller?
Controllers have a significant role in not only the finance department but also the entire company, and therefore have a set list of both hardskill and softskill expectations. Being a pro at financial management is a clear requirement. But controllers also require skills like clear communication and the ability to turn numbers into stories. Additionally, it can be helpful to have strong teamwork skills and knowledge across departments.
Out of the many expectations for controllers, there are four main ones that stand out:
Building a team that preempts problems
The controller is in charge of building and developing a top-notch finance team, and this is hands-down one of the most important parts of the job and one of the most important ways a controller supports a CFO.
But building a team is more than just filling empty seats. Today’s controllers need to understand how to build their team for the future of business financials, which means understanding better than anyone else where the industry is headed. From automation to security for the mobile workforce, a controller must have a keen understanding of how to start filling needs before they fully appear.
A great example of this is building out the knowledge on your team of ASC 606. Experts on an unknown framework aren’t easy to find, but finding a person to become that expert could be vital for future success. As Tien Tzuo, founder and CEO of Zuora, says:
“Given three years to do something about it, most finance departments promptly forgot about the new regulations. . . Today they’re either panicking to very little effect, or being willfully ignorant. Make no mistake — some corporate valuations are going to tank as a result…”
The controllers who decided three years ago to expand their teams to make bandwidth for their department to conceptualize and implement the necessary process changes are the ones who can meet ASC 606 with confidence. That leadership is what CFOs need from their controllers.
Thinking about business beyond the numbers
A typical way to split some controller and CFO duties is to think of controllers as looking backward — trend reports, monthly budgets, analysis of spend that has already happened — and to think of CFOs as looking forward to finances and profit, and in business.
Controllers need to be highly attuned to what the larger goals of the business are and how controllers can shape their work to support them. It could be as simple as adding new KPIs to reports to correspond to changing business goals, or it could be as complex as overhauling analytics for greater visibility into key areas.
In a Forbes Insights report, Arlen Shenkman, CFO of SAP North America, says:
“I think business itself is transforming, and finance is part of that collaborative approach. Controlling is helping to drive the numbers and helping to make business decisions, and it is a very valuable resource for any business unit or business leader. [Controllers are now] helping the business decide what they’re going to drive, where they’re going to make investments, and helping them understand how economics plays into that.”
That same report showed that a cornerstone of transformative controllers’ work was the ability and freedom to leverage their department to support progressive business goals:
Adding value to the organization as a whole, for example, means a controller provides more than just great reporting. It means great financial analysis and lightning-fast insights — visibility that allows exact figures to be pulled within minutes. It also means exploring avenues for technological upgrade, such as finance automation for increased accuracy.
This underscores the symbiotic relationship between the CFOs and the controllers of today. Controllers take a more holistic view of their role, more directly supporting larger business goals, and CFOs are happy to empower the controllers to make it happen.
Navigating accuracy and compliance as imperfect concepts
Since controllers are in charge of financial statements, reconciliations, and reporting, accuracy is critical to their job performance. But accuracy isn’t quite as transparent as it could be. Financial rules and regulations are constantly changing, and technology has only made keeping up with compliance more of a minefield. What constitutes accurate, and whether following compliance procedures will give you an accurate picture of your business are up for debate.
Take Twitter’s 2015 reports: They reported a GAAP net loss of $521 million but an adjusted EBITDA of $557 million and a non-GAAP net income of $276 million. It’s up to controllers to determine how and why these numbers look different and what the reality of a company’s situation is beyond the standard measures. Inconsistencies in reporting and the lack of more stringent regulations for companies prior to their IPO showcase how much control over a company’s image financial reporting can have.
In a report from the Harvard Business Review on the failings of financial reporting, H. David Sherman and S. David Young point out that no matter how a business chooses to evaluate themselves, there are always other sides of the story. And technology has only complicated the matter. A controller who understands all angles of revenue, projections, and reporting regulations will be a driver for company success well beyond simply being an information supplier. Controllers must look beyond easy notions of accuracy and compliance to fully support their C-suite counterparts.
Business partners leveraging technology
A Journal of Accounting & Organizational Change study reported that controllers could significantly add to the competitiveness of an organization by becoming business partners. Business partners create solutions that provide value to internal teams. To fulfill this new strategic role, controllers are adopting finance automation strategies.
Finance department challenges include harnessing new technologies while simultaneously improving culture to:
- Empower all employees
- Reduce manual tasks for the finance team
- Eliminate financial reporting lag
- Speed up month-end close
- Mitigate risk (by reducing human error)
- Ensure regulatory compliance
- Increase efficiency
Automation processes will be a crucial tool as the role of the controller moves beyond tactician to key strategic player.
Take your financial management to the next level
Controllers are a crucial part of the financial management ecosystem—but the job is a lot harder without the right tools. To maximize impact, a controller needs full transparency across departments. Efficient payment processes make it easier to review the financial plan, set benchmarks, and perform scenario testing.
Teampay can help.
Our automated spend management system provides not just controllers, but the entire finance team with the tools they need to optimize budgets and streamline financial reporting.
Try Teampay today and discover how you can transform your processes.
