Are you struggling to effectively oversee the operations of your business? How about making informed decisions surrounding high-level issues? Both of these issues highlight a need for controller accounting.
Controller accounting doesn’t involve the typical functions you find in an accounting department. In fact, the duties of a controller go beyond the basics, invoking thought and analytical procedures in their daily tasks.
General oversight of operations, compliance with regulatory agencies, high-level decision making, innovative growth strategies, and the interpretation of data are the five most important ways that controller accounting impacts your business.
General Account Control Oversight of Operations
Controller accounting doesn’t just focus on the numbers, but instead directs attention to all resources, including employees. When difficult management decisions arise surrounding an employee or unexpected bill, how will you make a decision? Controller accounting gives you access to the tools needed to weigh the situation and make the most informed choice based on your insight into general operations.
Compliance With Regulatory Agencies
From monthly sales tax remittances to filing the annual tax return, businesses must stay compliant to avoid stiff fines and penalties. Since this aspect of bookkeeping is a high-level form of business oversight, they often track key business decision surrounding compliance with regulatory agencies, including tracking sales tax nexus, conversing with outside professionals, and signing business returns.
When businesses don’t have controls in place, deadlines are missed and letters are issued, which may take months to work out. The ability to keep regulatory agencies, such as local and state governments, pleased, allows your business to flourish and develop strong relationships centered on compliance instead of noncompliance.
High-Level Accounting control Decision Making
Controller accounting is crucial for high-level decision making. Most managers and leaders in the company aren’t aware of the full financial and operational picture. This leads to uninformed decisions that affect strong cash flow management and scalability. For example, as money in the checking account begins to run low, what should you do? Pay employees late? Stop operations?
This type of accounting utilizes different resources to implement high-level decision making to draw on a line of credit, secure another business loan, or generate additional capital from investors. These options aren’t easily found in regular accounting procedures, making controller accounting a vital component of running a successful business.
Innovative Growth Strategies
All businesses want to grow; however, stagnant business growth can be attributed to a lack of controller accounting. It looks at the overall picture of a business’s financial health, including how each resource works together and factors into the financial statements. By understanding the operational and financial components, controller accounting uncovers innovative growth strategies.
Maybe the insight from a controller accounting dashboard uncovers a department that is underperforming. Management can then re-allocate resources or purchase additional resources to promote productivity and operational success, which contributes to growth both financially and operationally.
Big data is taking over how businesses operate. Controller accounting frequently utilizes big data to develop trends and growth patterns that contribute to effective and efficient decision making. Linking the data between the finance team and senior management decreases the risk of silos and allows a team approach to scalability.
In addition, the business objectives are easily linked to overall goals by understanding financial metrics that detail insight. For example, Key Performance Indicators, known as KPIs, are frequently found in controller accounting to track employee and customer turnover, growth between periods, and market reach. By utilizing these metrics backed by company data, the overall business has a higher chance of reaching budgetary and growth goals.
Next Controller Accounting Steps
This area of accounting helps your business by aiding in the general oversight of operations, ensuring compliance with regulatory agencies, assisting in the decision-making process, finding innovative growth strategies, and leveraging big data.
If you’re struggling to gain operational and financial control of your business, controller accounting isn’t something you can afford to overlook. Sometimes budgetary constraints prevent you from hiring a full-time controller; however, this doesn’t mean you can’t have access to the benefits.
Investing in a software program that provides access to controller accounting tasks is a great alternative for many business owners. Reach out to a team member today to learn more.