CFO vs Financial Controller: are these one and the same? Not quite.

While the term is often treated as interchangeable in Australia, the two roles have distinct differences ranging from their day-to-day responsibilities to the type of organisation they’re best suited to.

As a leading financial organisation in Perth, Your Financial Controller offers both part-time financial controller and outsourced CFO services for SMEs (Small and medium-sized enterprises). In this article, we’ll help you understand the key differences and similarities between a financial controller and a CFO.

In this article we’ll cover our most asked financial controller vs CFO questions:

  1. What is a financial controller?
  2. What is a CFO?
  3. What are their similarities?
  4. What are their differences?
  5. Is a CFO in a higher position than a financial controller?
  6. Who does a financial controller report to?
  7. Which one is right for me?

What is a financial controller?

A financial controller oversees and is involved in a business’s day-to-day financial operations. With a focus on reporting, a financial controller is responsible for a business’s finances, ensuring that the business’s finances are well looked after for the business to run smoothly and efficiently.

What is a CFO?

A Chief Financial Officer (CFO) is a senior executive who is responsible for all of a company’s financial activities and financial health. The CFO has a high level of responsibility towards the company’s success, requiring strategic planning and thinking to carry out high-level financial duties including stakeholder management, fundraising and acquisitions.

What do CFOs and Financial Controllers have in common?

Financial controllers and CFOs are leaders within a business’s financial department and use their financial and accounting expertise to help the company optimise financial processes. Although they operate on different levels of a company with different responsibilities (more on that shortly), there are several similarities in the roles of CFOs vs. Financial controllers:

  • Oversight – Both CFOs and financial controllers oversee a company’s financial operations.
  • Knowledge – A strong level of background expertise in corporate finance, accounting principles, financial forecasting and financial analysis is necessary for both roles.
  • Compliance – Both roles are responsible for ensuring company-wide compliance with financial regulations and standards.
  • Analysis – Both Financial Controllers and CFOs analyse financial data to influence decision-making at their level of the organisation.
  • Risk management – Accurate risk assessment is required for both roles along with the ability to determine a suitable plan of action.

What are the key differences between a CFO and Financial Controller?

The key difference between financial controllers vs. CFOs lies in their level of responsibility and company oversight.

A CFO must always have a comprehensive overview of the entire structure of the company. Unlike financial controllers who often find themselves ensuring the smooth movement and optimisation of day-to-day finances, CFOs are concerned with large-scale financial decisions and actions. This makes the CFO position more focused on strategy development and execution than a company’s financial controller and is concerned primarily with the bigger picture.

This element of the job also makes CFOs suited to large-scale companies rather than SMEs, as it requires additional resources to be able to delegate a role that focuses specifically on optimising, and strategizing for, a company’s finances.

For a brief overview of all the differences of financial controllers vs. CFOs, take a look at the graphic below, which outlines everything from responsibilities to company size.

Is a CFO in a higher position than a financial controller?

A CFO is the highest financial position within a company and oversees all finance and accounting personnel within a company’s finance division. This includes the financial controller, accountants and financial analysts. The CFO reports directly to the chief executive officer (CEO).

Who does a financial controller report to?

In a large-scale company, the financial controller will often report to the CFO. However, in smaller companies where the CFO role is not necessary, the chief financial controller may be the most senior financial officer and report directly to the chief executive officer (CEO) or company founder.

CFO vs. Financial Controller – Which Is Right for You?

If you’re a large organisation that has the resources for a dedicated finance department, including one or more financial controllers, then having a full-time CFO might be the right choice for you. Having a CFO will allow your business to stay ahead when it comes to the development of financial strategies and undertake large financial shifts within the organisation, such as mergers, with improved ease.

However, if you’re a small-medium business (under $50 million yearly turnover), then having a full-time CFO most likely will not be necessary and may strain your resources or divide attention away from the important day-to-day duties that keep your business running smoothly.

But does that mean you have to miss out on having those expert-led financial strategies?

The short answer is no!

A CFO is almost exclusively a full-time in-house role and isn’t required by the majority of companies. However, this doesn’t mean that smaller companies should miss out on having a finance expert dedicated to helping them excel in all their finance goals.

Our outsourced CFO services in Perth let you have the best of both worlds. With an outsourced CFO, you can gain expert financial leadership for your business without the cost of a full-time in-house CFO. With a boots-on-the-ground approach, our experienced team strives to be an extension of our client’s business, offering all the benefits of hiring a full-time financial controller such as bookkeeping, budgeting and reporting, but at a fraction of the cost.

With a range of services available to suit your business needs and budgets, we’ll help you build your perfect financial plan.

Take your financials to the next level today with an expert CFO or financial controller. Talk to our team to learn more.