Controller vs comptroller vs CEO—with so many titles, it can be hard to know which of these professionals your business needs.
These professionals have overlapping duties, and many people will use the terms interchangeably. However, there are important distinctions between controllers, comptrollers, and CFOs, and which one(s) you’ll need depends on the stage and nature of your business.
In this article, we’ll break down the differences between these roles and help you determine which type of professional is best for your finance team.
Table of Contents
Breakdown of Responsibilities
When businesses ask us for help, they’re often curious about the services of a Chief Financial Officer (CFO). Growing businesses often need that expertise, but the level of responsibility and cost increase as you move from bookkeeper to CFO.
You may need a senior expert, but it’s equally possible that you need an accountant or bookkeeper instead. During your consultation, ask about our outsourced accounting services and online bookkeeping services in addition to CFO services.
Related: Bookkeeping vs. Accounting: What’s the Difference?
What Does a Controller Do?
Controllers are senior financial professionals who manage the day-to-day operations of junior team members. Their primary responsibility is maintaining the accuracy and integrity of financial data.
They accomplish this task by:
- Ensuring GAAP reporting compliance
- Managing junior team members
- Preparing financial statements
- Making recommendations to senior leadership
- Implementing internal systems and controls
- Preparing budgets
Once an organization is large enough to need multiple bookkeepers or accountants, it’s often time to consider hiring a controller.
What Does a Comptroller Do?
Comptrollers oversee the financial operations of non-profit and governmental organizations. Since their duties overlap considerably, the controller and comptroller are sometimes used interchangeably.
In contexts where their roles differ, a comptroller has oversight over day-to-day operations as well as strategic decision-making authority.
In addition to the duties of a controller, a comptroller may:
- Develop financial models and projections
- Oversee investments
- Manage internal and external auditors
- Implement cost-reduction strategies
What Does a CFO Do?
The Chief Financial Officer (CFO) holds the highest financial position in an organization. They are executive team members and oversee controllers, comptrollers, and accounting teams.
Through analysis of the data collected by their more junior team members, they:
- Make strategic planning decisions
- Offer Financial
- Implement risk management strategies
- Develop relationships with investors
- Manage capital
- Perform Financial analysis and financial modeling services
- Occupy corporate and nonprofit board seats
- Merger and Acquisition Support
What Is a Chief Financial Controller?
Instead of bringing on a CFO, an organization will elevate a controller to the position of chief financial controller. This adds another layer of management and responsibility without the added expense of a CFO.
What Is an Interim CFO?
During a complicated transition period, companies sometimes hire interim CFOs instead of committing to a full-time employee. This is a common cost-cutting measure, allowing companies to access valuable expertise for only as long as necessary.
Decision-Making Authority
Controllers focus on day-to-day financial operations. They make recommendations to upper management, but their decision-making authority is limited.
CFOs are responsible for the strategic future of organizations, reporting to the CEO, board of directors, and investors.
Comptrollers can mirror the decision-making authority of both the controller and CFO. For instance, the state of Texas doesn’t have a CFO. Instead, it is led by a Comptroller of Public Accounts who assumes these duties. In organizations with CFOs and comptrollers, the CFO is further up in the hierarchy.
Where Do They Work?
These professionals can work in any industry, but CFOs and controllers are usually in the for-profit sector, while comptrollers usually work for non-profit or government institutions.
Related: Understanding the Nonprofit Statement of Financial Position
Education, Qualifications, and Salary
Controllers
Controllers typically hold a bachelor’s degree in accounting or finance, and many have advanced training, such as an MBA or Certified Public Accountant (CPA) designation.
They’ve typically been accounts for at least five years before earning this senior role, and owing to their education and years of experience, they make an average of ~$137,000 per year, according to Glassdoor.
Comptrollers
Similar to controllers, comptrollers are also senior-level professionals. Their education, experience, and accreditations are on par with what is expected of controllers.
Despite comptrollers often carrying more responsibility than their counterparts, the largest distinction between the roles is salary. Since they work in the nonprofit or government sectors, they earn a bit less, at ~$110,000 annually.
CFOs
Reflecting their higher degree of responsibility, CFOs have considerably higher education levels and experience than their controller or comptroller counterparts.
They are expected to have an MA in a relevant field, hold advanced accreditations such as Chartered Financial Analyst (CFA) or CPA, and often hold industry-specific certifications.
They earn ~$290,000 per year.
Key Differences Between Roles
Let’s compare each of these roles side by side to understand, on a deeper level, how they could play within your organization.
Controller vs. Comptroller
Both positions oversee day-to-day operations, but comptrollers sometimes assume the strategic decision-making authority of a CFO.
However, those differences may not be readily apparent to everyone. This is largely due to the number of similarities between roles, and many businesses use the two words interchangeably.
Differences include:
- Controllers are usually in for-profit sectors, while comptrollers work for nonprofits or the government.
- A corporate board oversees controllers while nonprofit boards or taxpayers hold comptrollers accountable.
- Controllers earn more than comptrollers.
Controller vs. CFO
CFOs have considerably more responsibility than controllers. They incorporate the day-to-day reporting of controllers into a long-term strategy and have decision-making authority, while controllers do not.
This difference in responsibility is reflected in a nearly $100,000 difference in average salary.
Comptroller vs. CFO
The difference in these roles depends on the organization and sector. Sometimes a comptroller is equivalent to a controller, and other times a CFO. However, comptrollers are usually in the nonprofit sector and will report to the CFO in organizations with both professionals present.
How Is a CFO Connected to the Comptroller or Controller?
The CFO is the head of an organization’s finance team, responsible for the company’s overall financial health, while a comptroller or controller focuses on more granular aspects of financial management.
Additionally, the CFO reports to the CEO and is part of the organization’s senior-level/executive team. A controller or comptroller oversees the finance department and reports to the CFO.
When to Expand Your Finance Team
It’s natural to be hesitant when considering help, especially when that expertise will not generate new revenue.
However, many of our clients come to us only after they’ve encountered a problem. Precautionary measures are often worth the investment.
It’s Time to Standardize Processes
As companies grow, they go through a handful of predictable stages. Small businesses outgrow the DIY phase and hire an accountant, bookkeeper, or tax professional to keep things organized.
Next, the volume of transactions can increase considerably. Somebody with a high-level view of day-to-day operations becomes necessary; controllers or comptrollers can help implement standardized processes, prevent errors, and ensure compliance in case of an IRS audit.
When Work Becomes Too Complex
As companies expand horizontally or vertically into new markets, their finances become more complex. A CFO’s expertise can be indispensable, especially if you’re considering a merger or acquisition.
If your company is growing rapidly, or if you’re looking to take it public, you’ll need a CFO on board. A CFO can also help turn around a struggling company and navigate challenging economies by assessing market trends, identifying growth opportunities, and developing investment strategies to capture new market share.
Preparing for Regulatory Changes
Some industries, such as financial services or healthcare, face heavy regulatory burdens. If the law is set to change in the near future, a knowledgeable professional can help navigate this transition.
Hiring a CFO FAQ
Do We Need a Controller If We Have an Accountant or Bookkeeper?
Yes, the role of a controller is to oversee these teams. As companies grow and complexity increases, a controller will eventually become necessary.
Does My Company Need a CFO if We Have a Comptroller or Controller?
Yes. A CFO may be necessary even if the company employs a qualified and efficient controller and finance team. Their value goes beyond running the company’s books; their ability to think long-term and develop creative solutions to financial challenges sets them apart.
Can I Substitute a Full-Time CFO With a Fractional CFO?
Fractional CFOs are an attractive option for small businesses or startups that can’t afford a full-time CFO. They can also be a good solution for companies undergoing a transition, such as mergers or acquisitions.
A fractional CFO works for your company part-time and provides the same expertise and experience as a full-time CFO but at a fraction of the cost.
Conclusion
Understanding the nuances between CFOs, controllers, and comptrollers is important for effective financial management.
Controllers and comptrollers are best fit for organizations that need help overseeing day-to-day operations, while a CFO is most helpful in executing long-term strategic planning initiatives.
For help growing your finance team, contact us for a consultation.
