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FINANCE

Outsourced CFO vs. controller: Which is right

for your financial strategy?
Posted by Grace Townsley

June 16, 2023

When it comes to developing your financial strategy and safeguarding your small
business’s financial future, you may find yourself facing this common dilemma: You
need expert financial guidance and support, but you don’t yet have the budget or
resources to hire a full-time, in-house, fully qualified financial team. 

If that problem sounds familiar, you’re not alone. As many as 80% of early-stage
small businesses operate without a Chief Financial Officer (CFO) or controller in
place. And unfortunately, what they don’t have can seriously cost them. That’s why
an outsourced CFO or financial controller can be one of the most valuable — and
cost-effective — financial strategy investments you can make in your small
business.

Schedule a call today

What do outsourced CFOs and controllers do?

Let’s start by defining the role of an outsourced CFO. This professional has a
handful of key responsibilities. They typically focus on the strategic financial
management of the company they serve, offer high-level financial strategy insights,
guide major money decisions, and analyze critical financial data and reports. Their
main goal is to drive business growth while maintaining your company’s positive
cash flow. 

Outsourced CFOs also have a specific skill set. They’re typically well-versed in
strategic planning, financial forecasting, capital management, fundraising, and
investor and board relations. This background helps CFOs aid your decision-
making, drive shareholder value and optimize your financial performance. 

Controllers, on the other hand, are primarily responsible for your day-to-day
financial operations. They ensure accuracy in your financial reporting, oversee your
accounting processes, and help you meet regulatory and compliance
requirements. 

A controller’s expertise is more technical than a CFO’s. They excel at record-

keeping, financial statement and report preparation, budgeting, financial analysis
and compliance with accounting standards. These professionals are analytical,
detail-oriented and numbers-focused. 

The benefit of hiring an outsourced controller is that they can improve your
financial accuracy and keep your small business compliant, so every decision can
be made with a high degree of confidence. 

What are the key differences between an

outsourced CFO and a controller?
While “CFO” and “controller” are often used interchangeably, and can cover some
of the same duties, there are a number of key differences between these two
professionals. 
First, CFOs are focused on the future — including strategic financial planning,
growth, and long-term decision-making. But controllers tend to look backward at
historical information. They focus on operations, financial management, accounting
accuracy and compliance. These reports are all based on what your small business
did over the past several days, weeks and months. 

Another key difference between CFOs and controllers is their expertise. While
CFOs may come from a broad financial background that includes financial planning
and analysis (FP&A), and business management, controllers tend to be more
technical experts. They may have a background in accounting, tax law, or
compliance, and may have additional credentials like the Certified Public
Accountant (CPA) designation. 

Talk to us about how Escalon’s FinOps can help your firm access financial
expertise. 

A third major difference between CFOs and controllers is the scope of their work.
Because CFOs are looking to the future, they view operations from a broad, big-
picture perspective. They’re concerned with the long-term implications of your
financial strategy and how each decision may impact shareholder value.
Controllers, on the other hand, pay closer attention to your day-to-day financial
operations, reporting and internal controls, ensuring that every dollar and data
point is accounted for. 

Should your small business outsource a CFO or a

controller — or both?
When it comes to outsourcing your essential financial needs, choosing between a
CFO and a controller may feel overwhelming. On one hand, a CFO is necessary for
your company’s long-term survival. But on the other, if your daily financials are
inaccurate, your team lacks the high-quality information you need to make sound
decisions. 

If you’re unsure which professional to outsource, consider these three questions: 

How big is your business?

Larger businesses with multiple locations, product lines or teams will benefit from
an outsourced CFO. Even if your leadership only needs the guidance of a CFO a
few times a week or month, having a dedicated expert on call is an invaluable
benefit to growing businesses.

How complex are your finances?

If your business deals with complex financial matters, like multiple revenue
streams, international operations, or significant capital-raising activities, an
outsourced CFO is strongly recommended. Not only will this professional help you
manage your capital, having an experienced CFO on board is a good signal for
your investors. 

How necessary is compliance and accuracy?

If your industry requires deep compliance, like in the financial and healthcare
industries, consider hiring an outsourced controller. This professional can help you
keep your books in order and meet regulatory compliance — so you can feel
confident in your big decisions. 

As your company grows, you will likely need both a CFO and a controller on your
team. And outsourcing these key functions gives your business full access to high-
value expertise without significantly increasing your overhead or management
burden.

In the meantime, consider the questions above. By assessing your business’s

goals, size, complexity and compliance needs, you can make an informed decision
about who to add to your support team.

Want more?
In addition to taxes, accounting, bookkeeping and CFO services through its
FinOps, Escalon’s Essential Business Services include PeopleOps (HR, benefits,
recruiting and payroll) and Risk (business insurance). Talk to an expert today.

Schedule a call today

This material has been prepared for informational purposes only. Escalon and its
affiliates are not providing tax, legal or accounting advice in this article. If you
would like to engage with Escalon, please contact us here.

Author

Grace Townsley
As a professional copywriter in the finance and B2B space, Grace Townsley offers small
business leaders big insights—one precisely chosen word at a time. Let's connect!

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