Please be aware that this might heavily reduce the functionality and appearance of our site. The Bureau of Labor Statistics estimates that the number of top executive jobs will grow by 3% from 2022 to 2032. The business of being a CFO will likely change a lot over the next decade, including navigating the rise of cybersecurity and the advancement of technology.
- As part of the C-level leadership board, they act as the primary advisor of the CEO in developing financial strategies to guide the company in reaching business objectives.
- At this size, there are many more moving parts in the accounting function, so the role is that of a classic controller.
- If required, the controller will also be responsible for selecting the level and type of technology used in any business for financial purposes.
- This includes managing risks, whether it be taking risks or protecting against disruption.
- A CFO, on the other hand, is paid $130,872 a year in the US, on average, as stated by PayScale.
- Once your business hits $50m in annual revenue, you may consider switching from a part-time CFO to hiring a full-time CFO.
Together, they coordinate decision-making, address company needs, and steer the company down the optimal path for growth. Does your business need a controller or CFO for its planning, financial reporting, cash management, and decision-making analysis? Learn about the roles and responsibilities of the CFO and controller and when to hire them.
This can be confusing for business owners who are trying to figure out which position they need to fill to best manage their company’s finances. CFOs are the highest-level financial professionals in a large organization. They’re big-picture thinkers who use the data brought to them by accounting and financial departments to help them strategize for the long term. CFOs work with other C-suite executives and high-level managers to develop new business strategies, ensure funding of new projects, and understand the nuances of a company’s financial picture. They know the numbers and are able to explain why they are how they are, even if they don’t perform the analysis themselves. The U.S. Bureau of Labor Statistics (BLS) places financial controllers in the category of financial managers, which also includes treasurers, finance officers, and insurance managers.
Financial controller vs. CFO
Companies with very simple accounting and reporting requirements may be content with a bookkeeper for some time. A controller is often one of the first hires for startups or small companies because the reports and metrics they provide are both a necessary part of doing business and the basis for future decision-making. The CFO is part of a company’s senior management team and reports to the CEO of the company and the board of directors. As an intermediary between management and operations, the CFO often partners with the Chief Operating Officer (COO) to identify significant business risks and opportunities.
According to ZipRecruiter, the average salary of a Hedge Fund CFO is $156,325. This figure may not include bonuses, incentives, or other compensation. Employers should use behavioral-based questions during interviews and ask for instances when they inspired a team, managed people well, solved business problems, enabled growth, and so on. Although CFOs have more or less the same role in all industries, they are hired more in certain sectors.
The CFO should have a big-picture understanding of the business and accounting, even if they don’t have a specialized accounting background. They should be able to optimize the capital structure, prepare business plans, investor decks and presentations, and obtain financing. Companies may become bogged https://personal-accounting.org/ down by an inefficient day-to-day accounting workload that uses too much time. Consider ways to increase the efficiency of your finance and accounts payable team to make more valuable business contributions. The controller is the accountant of an organization who deals with high-level accounting.
Ramp: A CFO or controller’s best friend
A full-time, fully burdened CFO salary will be around $300,000-$400,000 annually for small companies. As with the controller, however, you can reduce this cost significantly if you’re willing to outsource the function to a fractional CFO. According to PayScale.com, the median compensation package for a small business controller is $80,296. The complete range of salaries varies from $50,500 to $133,400 with influencing factors including company size and location. While some companies benefit from a fractional controller starting at $500K to $1MM, almost all companies have a controller by the time they reach $10MM in annual revenue. To simplify the major difference, a CFO will often be involved in fundraising and finance strategy, whereas a controller’s responsibilities usually stop at ensuring accurate reporting.
Salary, Benefits, and Perks of a CFO
For instance, tech companies will most certainly hire a CFO as a lot of investor money is at stake and growth expectations are high. A controller oversees routine audits, whereas a CFO drives the overall planning and budgeting process as well as identifies risks and develops mitigation plans. From a CFO perspective, they’re typically commanding anywhere from $250,000 to $350,000 base salary in mid-market companies. But again, it depends on the quality of the CFO that you’re looking for.
It’s also common for CFOs to pursue an advanced degree, such as an MBA. This provides business and operational acumen and boosts their ability to snag high-paying, highly competitive roles. However, while the CFO role may sound glamourous, it’s not for everyone. Many controllers are content to forego such a transition and stick to accounting. In short, “yes,” a controller can become a CFO, but it’s not necessarily the logical next step in their career.
Those within the bottom 25th percentile should expect to earn $408,594 per year, and those within the 75th percentile should expect to earn $898,653 per year. Additional CFO benefits include Social Security, 401(k), disability, healthcare, pension, and time off. The value of these benefits and perks for the average CFO is about 20% of total compensation. Financial controllers also develop and implement policies and procedures to safeguard the organization’s assets and minimize risk. They often work closely with auditors to ensure that the organization’s financial statements are free of material misstatements. Many companies, especially small businesses, tend to combine the two roles simply because it’s not feasible to hire for the two positions separately.
The controller vs. CFO debate makes more sense to a large company than a small business. According to Lightcast™, the typical entry-level education to become any type of financial manager, including a financial controller, controller vs cfo salary is a bachelor’s degree [1]. For these high-level positions, some companies may prefer candidates with a master’s degree. They are usually the ones who are putting the numbers together as you’re growing.
Controllers in very low-margin businesses like commodity contract or product manufacturers are involved in managing the razor-thin margins to ensure the sustainability of the organization. Savvy CFOs and controllers can leverage Ramp’s controls and insights to strengthen their finances and propel their company forward. A bookkeeper or accounting staff reports to the controller or business owner. In government entities or non-profits, the controller may be called comptroller and may serve as the highest ranking in the department responsible for budgeting and accounting. Unlike the Controller, the Chief Financial Officer should have a thorough knowledge of financial reporting and accountancy.
