A small business owner places a great deal of faith and responsibility on their financial controller. If you don't yet have a financial controller, read on to ensure you or other members of your team are filling this critical need. Much of your success depends on the accuracy, timeliness and usability of the financial data and financial reports produced by your financial controller.
Roles of a Financial Controller
Beyond managing the day-to-day financial activities, a financial controller plays a strategic role in your business. They oversee internal processes that ensure compliance with accounting standards and regulatory requirements, safeguarding your company against financial risks and fraud. Their expertise in financial management allows them to provide critical insights through financial analysis and reporting, which supports informed decision making by business owners and finance managers alike.
A skilled financial controller also often collaborates closely with other parts of the org chart, integrating financial planning and operational efficiency efforts across departments. This collaboration helps identify cost savings opportunities and optimizes the allocation of financial resources, contributing to the overall health and growth of the organization.
For example, in a SaaS company preparing to launch a new feature, the controller might work with the CFO, along with product, marketing, and customer success teams to forecast development costs, project customer acquisition impacts, and model different pricing scenarios. By aligning these teams around shared financial goals, the controller and CFO can help ensure that the feature launch stays within budget while maximizing ROI
By regularly evaluating financial performance using historical data and key performance indicators, financial controllers help business owners and management accountants track progress toward strategic goals and adjust plans as necessary.
What Questions Should You Be Asking Your Controller?
Are you asking the right questions to feel confident that your financial controller's activities are helping to lead you toward your goals? It may be that you don't feel qualified to manage someone responsible for your company's finances, which is why you sought to hire a financial controller in the first place. But there are some questions you can ask yourself (and your controller) that will help you feel more confident in the job that's being done to support your success.
1. Can I trust our margins and financial reporting accuracy?
You are likely aware that accurate gross profit (defined as revenue less the cost of sales) and operating income (gross profit less SG&A) are two key measures of your firm's profitability. Management of your margins is where your controller can and should be adding the most value. However, it's not uncommon to encounter classification errors which can be dangerously misleading. You might find it helpful to read our article about typical margin errors to arm yourself with some follow-up questions on this topic.
Your controller should also be leading external reporting, acting as the point person for auditors and ensuring all records are prepared to meet investor and regulatory standards. This builds confidence among stakeholders and helps avoid surprises during audits or due diligence processes.
Finally, a strong financial controller plays a hands-on role with your financial staff, providing training, guidance, and process improvements. They should promote best practices that support operational efficiency, making sure everyone involved in the numbers is on the same page and contributing to reliable, consistent reporting.
2. What are the key takeaways from our most recent financial close?
Your financial controller should be a close partner in helping you manage your business toward improved profitability. Challenge him or her to do more than generate reports. Ask them for real analysis of results and invite their advice and perspective on where and how performance improvements can be achieved. For example, they should be monitoring deviations from plan so you can assess how to address issues before they become larger issues and double down on opportunities to drive enterprise value over time. Their analytical experience can be a considerable asset to help you grow your business profitably.
Their response should include observations that you find useful and actionable. In other words, they should surface real world questions like “why did this expense spike in October” or “that new customer is surprisingly profitable, we need more of those.” If you start to nod off as they drone on about this academic ratio or that obscure figure, you'll know you're not getting the insight you need. To see the caliber of takeaways your controller should share, check out our article on the topic.
Be sure to take note of the date of the most recent close. Closing should occur monthly to ensure issues and opportunities are caught early. If your controller has to dust off last year's closing package and it's mid-summer, then you know you also need to ask him or her to pick up the close frequency.
3. What controls do we have in place to prevent errors and fraud?
First, you'll want your financial controller to reassure you that proper financial controls and security measures have been taken to protect your financial data. This should go beyond simply locking up confidential files within file cabinets or behind office doors. Ask for the password management plan for your accounting system(s) and confirm you are able to generate audit trails that reveal who is accessing systems and when. Anything less could be putting your systems at risk of criminal behavior, internally and externally.
Which leads us to the topic of fraud protection and internal controls. You want to ensure that your controller is appropriating key duties among employees in your organization to protect your assets and prevent nefarious activities. A simple system of checks and balances is a requirement. For example, the person responsible for collecting and depositing receipts should not be the same person who records accounts receivable. Similarly, bank statements should not be reconciled by someone who is responsible for issuing checks. If a single person can cut checks and reconcile the corresponding bank account, that person can tamper with the check register.
Delve into how your financial controller monitors financial activities to identify instances of fraud and prevent errors. For example, is your controller reviewing bank and financial statements closely for irregularities? Has he or she implemented a system to examine your accounting processes for errors or departures from expected results?
Lastly, use the element of surprise to test your controller and the controls he or she is managing. Scheduled audits allow for planning whereas a surprise inquiry provides an unvarnished view into every day activity.
4. How do our financial results and financial statements compare to industry benchmarks and our own history?
Just as you want your financial controller monitoring financial activities for errors and discrepancies, you want him or her to do the same using industry benchmarks as a measure of good business. Comparisons to industry benchmarks will help ensure that your company is remaining competitive in every facet of your business, including financial management. These comparisons are a core part of effective financial planning, helping you to allocate capital and prepare for upcoming obligations and seize future opportunities.
And these shouldn't just be measures related to industry benchmarks. You should expect your controller to make similar comparisons based on your company's past financial performance to ensure that you are continuously improving. For example, profit and loss (or P&L or income statement) reports should enable efficient comparison of monthly performance over the last 12 months and/or compare your most recent month or quarter with the same period in prior years. This type of presentation enables quick scanning for changes and trends (good and bad).
Financial Planning Tools that Strengthen Cash Flow and Resource Allocation
To conduct the comparison between your results and industry benchmarks effectively, your financial controller needs access to accurate, real-time financial data and well-integrated accounting systems. While smaller businesses will use tools like QuickBooks Online, larger, more complex firms may require enterprise resource planning (ERP) software that connects insights across all business units, from sales and operations to procurement and HR. These tools enable the controller to detect trends, flag underperformance, and pinpoint cost savings opportunities that improve profitability and working cash flow.
Your controller should not work in isolation. Benchmarking should be followed by meaningful discussion. They should provide feedback in scheduled check-ins with management and the broader finance team, turning raw financial data into strategy. These meetings help teams understand where the company is excelling or lagging and what changes could drive improvement.
This ongoing analysis — both against your own historical numbers and broader industry norms — forms the backbone of effective financial management. It ensures your leadership team is making data-informed decisions, allocating financial resources efficiently, and adapting operations as market dynamics shift.
5. What key performance indicators (KPIs) should I watch?
Your financial controller should help you identify the top 2-3 KPIs he or she will measure. Tracking these KPIs over time contributes to more effective financial analysis and helps your team refine ongoing cash management practices. These may be financially oriented metrics and they may include operational metrics, but these are the figures that you watch regularly to ensure you're tracking toward your goals.
For example, an information technology (IT) managed service provider (MSP) will want to watch the percent of revenue from monthly recurring contracts as that's the basis on which an IT MSP is valued. A law firm will measure collection timeline because collections are a common pain point for the managing partner who is tasked with managing cash flow. A medical practice should understand profitability by type of procedure to quantify the impact of changing reimbursement rates.
The KPIs will vary by industry and stage of growth, but they should evolve to support your current objectives. Your controller should serve as your guide and chief analytical officer when it comes to KPIs so make sure they're contributing in this area as well.
In closing, your entire finance team, not only your controller, has specific responsibilities and must be held accountable. Systematic assessment of their performance can make their performance review as black-and-white as comparing your sales person's revenue generated against their quota. Such accountability requires focused management and established systems, but the resulting impact is significant.
The Driven Insights Advantage
Driven Insights is experienced in leading service businesses on the journey to leveraging financial and operating metrics to accelerate growth. Our bookkeepers and financial controllers are charged with much more than simply “doing the books” – they ensure each client understands and uses the insights we share.
Interested in learning more? See for yourself how Driven Insights can provide the insight and control you need to achieve your most critical goals by contacting us at info@driveninsights.com or 888-631-1124.
