I frequently hear entrepreneurs refer to Bookkeepers, Controllers, and CFO’s interchangeably. The truth is all three positions have significantly different roles and responsibilities. It is important to engage a person with the right skill set to achieve your objectives otherwise you will either end up disappointed with the final product or paying more than necessary for what you need.
When you first start your company your startup accounting needs focus primarily on compliance, i.e. making sure transactions get recorded properly in your accounting system, filing your HST return on time, making sure your payroll and remittances are processed, and getting things ready to hand off to your external tax accountant to tackle your year-end taxes. This is the realm of the Bookkeeper.
As your company evolves and grows from thestartup phase, your accounting needs will change and get more complex i.e. moving from cash based accounting to accrual accounting, needing financial statements that are prepared in accordance with GAAP, working with banks to get operating loans, creating financial models and investor presentations to raise money from venture capital investors. That is where a Controllerand CFO come into play.
Summary: If you decide to outsource your startup accounting or bookkeeping, working with a firm that has the ability to grow along with you and offer strategic financial advice at the Controller or CFO level is a good way to go. Not only will you get your compliance stuff taken care of but you will have access to a strategic sounding board to help you with the really valuable and hard stuff.
About the Author
Wilson Lee is the founding partner of BrightIron www.brightiron.com. BrightIron was created to fill a void and provide startup companies with access to a team of seasoned CFO’s, Controllers and Bookkeepers, on a fractional basis. Startups can now access a team of finance professionals at a fraction of the cost, to help them manage the finance function and drive growth in enterprise value.
Previously, Wilson worked as CFO/COO in several technology startups and has experience in building and operating a software company from the start-up phase through to the exit/sale phase. Wilson has also worked as an Investment Banker and Venture Capitalist providing him with a unique perspective of financings, mergers and acquisitions in a startup world.
Wilson can be reached by email at [email protected]