CFO vs. Controller

Difference Between CFO and Controller

There was a time when companies were not as large as they are today and could well do without some positions that are commonly seen in a large corporation today. Two positions that are commonly encountered are CFO and controller that are very disconcerting at least to a stranger because of similarities in the nature, roles and responsibilities of both positions. Yet there are many differences that will be obvious after reading this article.

When business grows faster, the need for a controller is felt and managing the financial success of the company becomes a strenuous exercise and stressful activity. A controller is a financial manager who despite his high salary is a capital for the company because of its expertise with the latest financial systems and software that help to limit the cost. In fact, a good controller can often pay for himself by the price cuts he brings in to the company. He is the person who runs the cash flow with ease and efficiency. A controller knows all about the book keeping and it can easily supervise book keeping staff. He is the expert in the creation of financial reports weekly or monthly depending on the requirements of business. He is aware of not only the software that is best for the organization, he also maintains effectively. An experienced controller can even make decisions of significant cash flow.

Yet there is a position that is superior to a Controller and it is called the CFO. When the size of business has grown a lot, it is always prudent to have a specialized CFO. A CFO has the skills that are needed to effectively handle any work that a controller does in an organization. There, on the basis of his knowledge and expertise, a CFO may negotiate complex situations regarding financing equity and debt. It is also an expert in maintaining successful relationships with banks and other financial institutions.

If you have a Controller that performs well and is very open to challenges that are beyond the domain of its responsibilities, you probably do not need a CFO. However, if this is too much for your controller, you can either go for a part-time CFO or you can replace your controller with full fledged CFO. While a controller is not really a part of the management, a CFO is second only to CEO and has complete control over the department of finance.

 

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