An accounting department of any business needs to be neatly tucked in and presented as a clean slate. Any business with a fine accounting department prospers because of the clarity in the financial statements. Having clean finances could serve many purposes for business owners and could have many advantages. Still, the most important one is that it gives the business owner a clear vision for the future.
Different individuals could work in the accounts department, but each department consists of differing positions. These positions vary by the duties the employee has to perform once they join your company. A competent accountant must be able to analyze your financial statement, clear out all your credit by the time the accounting cycle concludes, calculate profit and loss, as well as net income.
Now understanding these positions and then hiring the right person for your business can be challenging. We have broken down each class to help you know them better and then make sound decisions.
CFO (Chief Financial Officer):
A CFO sits on a high pedestal within the accounting department. They are the authority that is constantly in talks with the business owners as they report the financial findings to them. They oversee all the stakeholders and how they may be affected by the different decisions taken within the department. The chief financial officer combines the past data with the future statistics to come to plausible conclusions so that the company can make appropriate decisions. Preparing reports and strategies for risk management are also the jobs of a CFO.
A CFO has several bookkeepers, controllers, accountants, and clerks reporting back to them to know everything related to the business. They are also in charge of creating new policies for the organization that would affect its finances.
Only an extensive business should need a CFO because of the lack of financial affairs to manage in small businesses.
Bookkeeper:
A bookkeeper manages all the business’s financial records, including all purchases, due payments, loans, profit, losses, and income. A bookkeeper deals mainly with the numbers they receive.
A competent bookkeeper must cater to the needs of the business by tending to the journals and ledgers that carry all the financial data. Without the help of a bookkeeper, the business owner may not adequately complete this task, which could potentially affect the quality of business.
A business owner should start looking for a bookkeeper when they step foot into the world of business. A bookkeeper is necessary for even small companies because, unlike a CFO, a bookkeeper has to tackle all major and minor financial data of a business that is just as much part of a small business as a large corporation.
Controller:
A controller plays the role of a middle person because clerks and bookkeepers report directly to them while they have to document all their findings to a CFO.
The role of a controller is to supervise all the work of an accounting department. They could also play the role of a financial manager in an organization. They focus their energies on helping a CFO create different strategic game plans to increase the organization’s cash inflow.
Who to Hire?
This question often confuses a lot of business owners. While starting a business, they are often unaware of the hierarchy of the accounting department. Including the positions, they should be offering according to the company they run.
Before deciding, you should, first of all, assess the size of your business. The size of your business is what determines the financial data you would have to cater to once the company is up and running. Ensure that you make a thorough analysis to see how much your business can be affected by hiring the right person for it.
If your business is extensive and deals with a comparatively larger corporation, you should acquire a CFO and the rest of the subordinates. But if your company is limited and has a narrow approach in the market, a bookkeeper would be enough.
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