As your business grows, so do your financial needs. But who should manage them: a bookkeeper or a controller?
Understanding the difference between these roles is essential to making the right hire—and setting your business up for success. Here’s everything you need to know about bookkeepers, controllers, and when to work with each.
What a Bookkeeper is and Primary Responsibilities
A bookkeeper is defined as a professional who records financial transactions. They are the foundation of a company’s financial records, managing tasks such as tracking daily expenses, invoicing clients, reconciling bank statements, and maintaining ledgers. Bookkeepers ensure that day-to-day finances are accurate and up to date, providing essential support to both small and large companies.
In terms of company size, the role of a bookkeeper for small businesses is especially critical. In smaller organizations, bookkeepers may handle a broader range of tasks and often work closely with owners to provide a comprehensive view of financial health. Their role allows small businesses to stay organized, meet tax obligations, and ensure cash flow is monitored effectively.
Primary Responsibilities of a Bookkeeper:
- Recording financial transactions and maintaining the general ledger
- Reconciling bank and credit card statements
- Managing accounts payable and accounts receivable
- Invoicing and tracking payments from clients
- Preparing basic financial reports, such as profit and loss statements
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Did you know that? In the video below, Jennifer Barnes, CEO at Optima, highlights tasks bookkeepers are not usually good at, which cause problems for businesses in different industries.
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What a Financial Controller is and Primary Responsibilities
The financial controller oversees and manages all financial functions. Controllers take a more strategic role in accounting operations, ensuring a company’s financial practices align with broader business goals. They play a key role in financial planning, budgeting, compliance, and preparing for audits.
Financial controllers work closely with upper management to provide insights into the company’s financial health, often acting as the bridge between bookkeeping and executive leadership.
For medium to large organizations, a financial controller helps shape the financial strategy, manages risks, and ensures financial reporting accuracy. In smaller companies, this role might be less common, but it becomes indispensable as the business scales.
Primary Responsibilities of a Financial Controller:
- Overseeing financial statements and reports
- Managing budgeting and forecasting processes
- Ensuring compliance with tax and regulatory requirements
- Performing financial analysis to aid decision-making
- Developing and implementing internal financial controls
The Differences between Bookkeepers and Controllers
Understanding the differences between bookkeepers and controllers can help businesses make informed decisions when building their financial teams.
Here’s a closer look at the distinctions between the two roles.
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Aspect
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Bookkeeper
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Controller
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Primary Focus
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Daily transaction recording and financial accuracy
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Financial strategy, oversight, and compliance
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Scope of Work
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Manages invoices, expenses, and ledger maintenance
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Oversees financial reporting, budgeting, and planning
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Company Fit
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Ideal for small businesses
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Essential for medium to large businesses
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Required Skills
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Detail-oriented, knowledge of bookkeeping software
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Advanced accounting, often CPA-certified
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Reporting Structure
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Reports to Controller or management
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Reports to CFO or CEO, oversees bookkeeping
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Main Goal
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Ensure accurate records and support daily operations
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Drive financial strategy and support executive goals
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Focus and Scope of Work
Bookkeeper: Focuses on transactional-level details, such as recording transactions, managing day-to-day finances, and organizing financial records. They ensure the accuracy of records and handle accounts payable and receivable.
Controller: Takes a strategic, high-level view of finances. Controllers are responsible for financial planning, budgeting, and aligning financial strategies with company goals. They analyze data prepared by bookkeepers to provide insights that guide management decisions.
Company Size and Fit
Bookkeeper: Suited to businesses that need help managing basic transactions and maintaining organized records without extensive strategic oversight. Bookkeepers often serve as the primary financial point of contact for smaller organizations.
Controller: Generally required as businesses grow and face more complex financial and regulatory needs. A controller is essential for medium to large companies needing robust financial planning, compliance, and auditing functions.
Skill Requirements
Bookkeeper: Requires strong attention to detail and a thorough understanding of bookkeeping software and accounting principles. Bookkeepers typically do not need advanced qualifications, although certifications like Certified Bookkeeper (CB) can be advantageous.
Controller: Requires advanced financial and accounting expertise, often including a CPA (Certified Public Accountant) qualification or equivalent. Controllers typically have several years of experience and may hold a degree in finance or accounting.
Reporting Structure
Bookkeeper: Often reports to the financial controller or directly to company management in smaller businesses.
Controller: Typically oversees the bookkeeping and accounting departments, reporting directly to the CFO or CEO.
Should You Get Rid of Your Bookkeeper? Here’s Our Approach
You may be thinking after reading this article and acknowledging the differences between both roles, if you should get rid of your current Bookkeeper and have a Controller only.
Take a moment and listen to what Jennifer Barnes, CEO at Optima Office, has to say about it.
