Many business owners reach a point where managing the financial side of the enterprise becomes overwhelming. Usually, this is a good thing! The company has grown to a point where simple bookkeeping and basic financial reporting just don’t cut it anymore. If you can relate to the feeling, hiring a startup CFO or controller might be the solution you’re looking for. However, you need to first consider whether your payroll can take on this generally high-paying position and exactly what you’d get in return.

The Broad Role

A CFO or controller looks beyond day-to-day financial management. This person does more holistic, big-picture planning of financial and operational goals. He or she will take a seat at the executive table and serve as your go-to person, handling all matters relating to your company’s finances and operations.

A CFO or controller goes far beyond merely compiling financial data. He or she provides an interpretation of the data to explain how financial decisions will impact all areas of your business. This individual can also plan capital acquisition strategies. By doing so, your company has access to financing, as needed, to meet working capital and operating expenses.

In addition, a CFO or controller will serve as the primary liaison between your company and its bank to ensure your financial statements meet requirements to help negotiate any loans. Analyzing a possible business merger, acquisition and other expansion opportunities also falls within a CFO’s or controller’s purview.

Specific Responsibilities for Hiring a Startup CFO

A CFO or controller typically has a set of core responsibilities that link to the financial oversight of your operation. This includes making sure there are adequate internal controls to help safeguard the business from internal fraud and embezzlement.

The hire also should be able to implement improvement in cash management practices. In turn, there will be a boost to your company’s cash flow along with improvements with the start-up budgeting and cash forecasting. He or she should be able to perform ratio analysis and compare the financial performance of your business to benchmarks established by similar-size companies in the same geographic area. And a controller or CFO should analyze the tax and cash flow implications of different capital acquisition strategies. For example, buying vs leasing equipment and real estate.

Major Commitment

Make no mistake, hiring a full-time CFO or controller represents a major commitment in both time to the hiring process and dollars to your payroll. These financial executives typically command substantial high salaries and attractive benefits packages.

So, first make sure you have the financial resources to commit to this level of compensation. Instead of hiring a startup CFO in-house, you may want to outsource the position. No matter which route you choose, our accounting firm can help you assess the financial impact of the idea.