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Controller vs Bookkeeper: What Does a Business Need?

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Welcome to our guide on controller vs bookkeeper. In this guide, we explore what a controller and bookkeeper are and the key similarities and differences between the two. We will then dive into the question of what your business requires – a controller or a bookkeeper. For businesses that require both a bookkeeper and a controller, we have the perfect solution to accommodate both roles. So, let’s start right away!

What is a Bookkeeper?

Bookkeeper, as the name suggests, prepares and maintains books. In layperson’s terms, a bookkeeper’s core responsibility is to record transactions in the form of general entries. However, that’s not everything and a bookkeeper’s jobs range from creating invoices to managing payrolls.

Here are some key responsibilities of a bookkeeper listed below.

  • Recording financial transactions accurately
  • Maintaining ledgers and accounts
  • Generating invoices
  • Updating debits and credits
  • Keeping track of payments and bills

Importance of a Bookkeeper

Bookkeeping and maintaining financial records is the core of the accounting system. The business needs to maintain accurate accounts for financial analysis, generating tax reports, and management operations. Without it, there will be no way to track cash flow, measure profitability, and prevent financial fraud.

Thus, for all financial operations that increase the efficiency and productivity of the company, accurate bookkeeping is mandatory. A bookkeeper takes this responsibility so that the management and business owners can focus on more crucial tasks.

What is a Controller?

Before we compare controller vs bookkeeper, let’s get to know what a controller is.

A controller is a higher accounting officer for a business or firm. The controller supervises the bookkeeping and accounting operations. Their role is to ensure that financial operations are carried out accurately. The controller has sound knowledge and experience when it comes to accounting operations, and they use it to manage these operations. Every growing company needs a controller to control costs and increase efficiency in financial operations.

A controller has several roles in an organization, some of which are listed below.

  • Supervise and oversee all the financial operations, including accounting and bookkeeping.
  • Create and check the correctness of financial reports
  • Choose the most suitable financial software for business
  • Develop and implement a new plan of action for financial operations
  • Help to reduce the total expenses
  • Generate in-depth analysis for business management
  • Develop and manage internal control components and guidelines
  • Set up Key Performance Indicators and manage them
  • Ensure compliance in the financial and business operations

Importance of a Controller

In a company with no controller, management is responsible for overseeing accounting and financial operations. However, the management and business owners usually don’t have the time, expertise, and insights to examine the efficiency of the financial operations critically. This is a large gap and hides the possibility of wasted resources, exaggerated expenses, and even financial fraud.

A controller fills this void by closely monitoring and managing the financial operations. The controller sees that the financial records are accurate and the procedures are conducted timely. Moreover, the controller analyses the company’s finances and leads the company towards sound financial health. It is a fact that any growing business needs a controller to lead its financial operations towards business goals.

Controller vs Bookkeeper: Similarities and Differences 

While a controller and bookkeeper are two different job designations, they have a lot of similarities. Moreover, a controller can have drastically varying job responsibilities in different companies. Smaller companies expect the controllers to take care of bookkeeping and accounting tasks and manage them all by themselves. In larger companies, a controller has more specialized tasks, such as managing the accounting and financial operations and leading the team. Explore everything on an outsourced bookkeeper and controller service here.

Controller vs Bookkeeper: Similarities

Let us look at the similarities between a controller and a bookkeeper.

  • They both work for the sound financial health of the company.
  • Both controller and bookkeeper are closely associated with the bookkeeping and account management tasks.
  • Both the controller and bookkeeper’s efforts are essential to generate accurate financial reports and tax returns.

Controller vs Bookkeeper: Differences

Regardless of a few similarities, the work of a controller and a bookkeeper is very different. Here’s a quick comparison of controller vs bookkeeper.

 

Bookkeeper

Differences

The bookkeeper enters journal entries and carries out basic tasks.The controller supervises the work of the bookkeeper and accountant.
The bookkeeper is assigned the clerical tasks of inputting data.The controller’s main task is supervision and has bookkeepers and accountants reporting to them.
Other tasks of a bookkeeper include generating invoices and sales receipts, keeping track of payments, etc.The controller takes care of internal control, analysis of financial data, and leading the financial team.

A Controller or a Bookkeeper – What Does Your Business Need?

Large businesses clearly need all three – bookkeeper, accountant, and controller. Given the high volume of data these companies have, no two roles can be accommodated by the same person. Moreover, hiring different persons for different roles allows specialization and enhances efficiency. However, it was quite obvious, wasn’t it?

Small Businesses

The million-dollar question is what a small business needs. Small businesses have tight budgets and can’t be generous in hiring employees.

Well, a bookkeeper’s job isn’t simple, and you cannot burden your management and yourself with it. Let the bookkeeper take care of the tedious tasks of data entry so that your time and attention are available for core management and leadership tasks. Therefore, if small businesses have to choose between hiring a controller vs bookkeeper, hire a bookkeeper first.

However, for better efficiency and supervision, you need a controller in addition to the bookkeeper. Either way, you cannot replace the bookkeeper in your company.

Growing and Mid-sized Businesses

As your business starts to grow and the amount of data and transactions increases, you cannot function without a controller. It becomes difficult for the management to closely monitor the financial operations and look for the scope of improvement. Without a controller, you will be working with low efficiency and productivity. The financial operations won’t be accurate, and the business will not be able to spot opportunities for cost reduction. The result will be you’ll be wasting a significant portion of your income in the form of expenses, giving way to low profitability.

Therefore, the growing and mid-sized businesses need a controller on top of a bookkeeper and accountant. However, if required, the controller can also take care of accounting.

When Should a Growing Business Hire a Controller?

When a business grows, there will be a point in time when they will need a controller. Therefore, a business owner should know the right time to hire a controller for the company.

Here are the key aspects to focus on to gauge the need to employ a controller.

1. Accounting Transactions

The first hint is the increasing volume of accounting transactions. When the business starts recording too many transactions, tracking and managing them becomes challenging. This is when the management can no longer supervise the bookkeeping and accounting operations. The business needs a controller to supervise and lead the financial operations.

2. Complexity of Operations

As the business grows, the management will start to find it hard to handle the complexities of financial operations. The management can no longer supervise and address tax issues, compliance, foreign exchange, day-to-day bookkeeping, developing and implementing internal control, etc. This is a sign that there is a pressing need to hire a controller or outsource the operations to an accounting firm.

Outsource Bookkeeping and Controller Services

This was all about controller vs bookkeeper you must know. However, growing businesses might need to hire both a bookkeeper and a controller. However, this poses a challenge to the growing businesses. The challenge is accommodating the expenses of paying and maintaining them both in the company.

There is a solution to this crisis – outsourcing bookkeeping and controller services. Our accounting firm provides bookkeeping and controller services at the same place. Therefore, businesses can now benefit from both these services at an affordable price.

Outsourcing bookkeeping and controller services from the same firm has its advantages.

  • It eliminates various points of failure.
  • There is no need to facilitate coordination between the bookkeeper and controller.
  • The total expenses on bookkeeping and controller services are reduced significantly.
  • It reduces the time taken on various financial operations and helps in generating reports timely.
  • The management no longer needs to foresee the bookkeeping and accounting operations.

Contact Us Now!

Explore our outsourced bookkeeping, accounting, and controller services at no cost. We offer a free trial to small and budding businesses. Therefore, connect with us today and revolutionize your business operations.

Dial +1(800) 580-5375 to connect with our advisor for a free consultation!

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