So what is a Financial Controller and do I really need one?

We are regularly asked this question, or we get blank looks when we mention Financial Controllers, so what are they?

If you Google, “what is a Financial Controller?” this is what you get, be warned, this is a bit dry…:

A financial controller is a senior-level executive who acts as the head of accounting, and oversees the preparation of financial reports, such as balance sheets and income statements

Wow, that sounds rather dull, don’t you think?

We believe the definition above is obsolete, today’s Financial Controller is expected to be more than just about the numbers.

Ernst and Young researched the changing role of the Financial Controller and they surmised that there are four discrete roles in a Finance Function, remembering that the Financial Controller is the head of the Finance Function. These are:

  • Commentator – focus on explaining the numbers
  • Business Partner – focus on value creation
  • Scorekeeper – focus on bookkeeping
  • Custodian – focus on governance

As shown in the chart the Financial Controller role has evolved to no longer be the ‘back office’ function it used to be, focused primarily on the bottom left scorekeeper role. It is now much broader and today’s Financial Controller is expected to fully participate as part of the Management Team providing insight and challenge, so up in the top right of the chart.

The benefit of a Financial Controller to a Small Business

What this really means for a small business is that a good Financial Controller becomes a valued and trusted business partner to the Managing Director and Business Owners. More importantly they identify opportunities for cost savings and efficiencies, manage your cashflow, improve processes and they will remove the day to day burden of all the Financial Compliance.

They have the skills to produce reliable Financial Information with insightful commentary to support business decisions. They have the conviction to challenge where challenge would be appropriate, ensuring all risk is taken into consideration when making business decisions and they will provide insightful, forward looking data so you know where your business is headed.

All this means the Managing Director and his or her team can focus on growing the business whilst having confidence that the underlying structure is strong.

To some this sounds much like a Finance Director role and the line between Financial Controller and Finance Director can become rather blurred.

There are many different sized organisations and different levels of Financial Controller within the profession and likewise for Finance Directors. The job titles are sometimes used interchangeably, especially in the zone where you have a Senior Financial Controller and a Junior Finance Director, then we would argue they are one and the same.

That said there are tasks that a Financial Controller doesn’t traditionally lead, which Finance Directors do. These areas are primarily around strategic initiatives, such as leading Merger and Acquisition work, planning exit strategies, sourcing significant Finance from banks and other investors and high-level risk management.  An experienced Finance Director can also provide commercial support to the business and help drive contractual negotiations and partner with the sales organisation to grow revenues and improve sales performance.

So which one does an organisation need; do they need both Finance Director and Financial Controller, and when do they need them?

This is a very difficult question to answer as every business and strategy is different and it’s different across industries, so with that in mind here are some basic considerations.

The relationship between the Financial Controller and Finance Director is a key one. In essence, a Financial Controller Controls and a Finance Director Directs. If you have both, each is able to focus on their area of expertise. With today’s portfolio of Financial Controllers and Finance Directors this partnership can be enjoyed by many more businesses.


The table below gives some guidance on Turnover and when the partnership is beneficial and a Financial Controller essential.

Financial Controller
Finance Director
£250k growing to £2m A few days a month, supported by a bookkeeper Generally no.
£2m to £5m


Part time as a minimum Flexible support needed, to reflect company growth and strategy. 1-2 days per week
£5m to £8m Full Time Flexible support needed, to reflect company growth and strategy. 2-3 days per week
£8m to £20m Full Time Part Time strongly advised
£20m + Full Time Full Time

This table is just a guide and shouldn’t be applied as a hard and fast rule, there are many other considerations, such as growth strategy, cash management and type of business. Many organisations are well funded in their start-up year and scale very quickly, these organisations should have a strong Financial Controller from the start with access to an experienced Finance Director as needed. As the business starts to scale, the business would benefit from having a Finance Director providing support on a more permanent basis.

If you would like to read the report from Ernst and Young, here is the full report for you to download.

If you would like to discuss the benefits of a Financial Controller or Finance Director, or even both, please do get in touch with us at [email protected].

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