Outsourced Financial Controller

If you struggle to get reliable financial information, or you cannot understand the information that you are getting, then you should consider taking on an outsourced or part-time financial controller.

I was talking with a business owner recently who is running a substantial, exporting business.  They don’t have any qualified accounting staff in-house.

At the end of the year, the external accountant prepares the annual accounts but these accounts arrive several months after the year-end and they don’t shed much light on why the business is getting the results they are getting.     The business owner isn’t happy that they are helping him to manage the business.

Option Of An Outsourced Financial Controller

I suggested that he consider using the services of an outsourced financial controller.  He hadn‘t realised that this was possible.

The option of having an outsourced controller is quite common now.  There has been a growth, in recent years,  in the number of companies taking advantage of the services of outsourced financial controllers.  This is partly due to the rise in the use of computerised accounting systems, which make it easier to analyse and understand the information, and also due to the increased awareness of the need for better financial management skills.

Outsourced Financial Controller

What Will An Outsourced Financial Controller Do For You?

1. Understand the business

The first thing that I would do on starting an assignment for you is to understand your business and what information you will need to run the business.

Typically, I will want to get familiar with your products or services, with your customers, with your production or delivery process, and finally with your suppliers and what you buy from them.

I will also want to be very clear on the goals of your business so that I can provide better support.

2. Design systems to give you the financial information that you need

I would use my understanding of your business to identify what sort of financial analysis you need for the business.

This could include how your sales are analysed, how your purchases and overheads are analysed, and if you should be making use of cost centres or departments.

Usually, I would help you to identify your Key Performance Indicators (KPIs) for the business although the KPIs should not be just financial.

3. Optimise the financial processes

Next, I will look at what you are currently doing with your financial information.  I will want to understand the workflows within your accounts department – identifying who is doing what, what controls you have in place to secure the company’s assets and what sort of systems you have and if you are using those systems well.

4. Assess and develop existing staff

I will also want to ensure that everything that needs to be done has been identified and allocated to someone and that they are clear on what they have to do and that they have the appropriate skills and experience.

While getting familiar with your business, I will be interacting with your staff and I will form an opinion on how much support and/or development they might need.

Usually, I work with the existing staff – coaching them so that they are comfortable doing what needs to be done.  But sometimes, if there’s no one to do the job, I help to hire someone to fill this role

I will also be available to answer any questions that they might have.

5. Prepare budgets/forecasts

I like to prepare an annual financial budget for the business.  This will be based on assumptions about growth, staffing, costs, and investment plans.

The budget will show how profitable the plans of the business are and will highlight any problems with cashflow.

Depending on the business, this budget may have to be updated 2-3 times during the year to reflect developments that are emerging as they work through the year.

The budgets will feed into the monthly management accounts.  By comparing actuals to budget the management will develop their understanding of the business and will become much better at budgeting.

6. Cash management

Most businesses need to manage their cash closely.  Even when a business has large cash reserves, you find that they have built these up by managing cash closely and that they continue to do that.

The financial controller will develop short and long-term cash forecasting and management procedures and will provide guidance for the staff on how to work with these.

7. Providing financial inputs to decision making

As the business is carried on, issues crop up that will require decisions and as an outsourced financial controller, I can provide key financial inputs to those decisions.

To do this I draw on the understanding of your business that I have built up by working in your business and also on the reliable accounting information that is now being prepared in your business.

Outsourced Financial Controller

What To Look For In An External Financial Controller

It would be expected that an outsourced financial controller would have good accountancy skills.

Secondly, your outsourced financial controller will need to be able to develop a good understanding of your business.   He/she will also need excellent commercial awareness.

You should be looking for an outsourced controller that has already held a full-time controller position and can bring that experience to your business.

Additionally, because most outsourced financial controllers have many clients they will be exposed to lots of different businesses.   They can take the best ideas and practices from one sector to another.

Your outsourced financial controller will have to have good relationships with your management and staff and will require to be able to communicate accounting information in a way that is easily understood by a non-accountant.

The outsourced financial controller will likely have a number of different clients and will need to be able to manage time and to be able to easily switch between clients without having to spend a lot of time catching up.

How Much Time Will A Financial Controller Need To Input?

That depends on the business – both on its complexity and on its stage in the business life cycle.

A young ambitious business with challenging growth plans will need more time than a mature stable business.

It will also depend on the quality of the in-house accounts staff.  The more you can delegate to them, the less time the outsourced financial controller will have to input.

In my experience,  the time input can range from as little as a half-day or a day per quarter and can be as high as 2 to 3 days per week.  It really depends on the outputs you want and the resources already within the business.

Typically, I find 1-2 days per month the most common.

Normally, before taking on an assignment, I will sit with you and understand your business and needs.  We then discuss the different elements of the service allowing you to customise the service to suit what you need.

Who Needs An Outsourced Financial Controller?

If you are having any of the following problems, then you should consider hiring an outsourced financial controller.

  • Disappointing profitability
  • Cashflow problems
  • Accounting surprises at year-end
  • Difficulty  explaining the performance of your business to your bank managers
  • Having aggressive growth plans that require tight financial management
  • Thinking about bringing external investors on board
  • Not satisfied with the explanations that you are getting from your annual accountant

Management Accounts vs Annual Accounts

The focus of an outsourced financial controller is usually on delivering management information.  This will help management understand the financial effects of their decisions.

The focus of the annual accountant is usually on compliance – preparing the annual accounts and the annual return and the tax returns.

Do you need more than one accountant?

You don’t have to have more than one accountant, but sometimes different people have different skillsets and you may be better off having 2 or more people with specific skills rather than one generalist.

Some business owners like to have one accountant who provides outsourced controller services and can also handle the compliance work.  Other owners like to have the year-end work done separately. It doesn’t matter and it’s really down to your own preferences.



Running a business can be demanding but there are resources available to modern owner managers that were not available prior to this.

Having the services of an outsourced financial controller available lets the business owner have much better information and analysis skills available at a fraction of the cost of a full-time controller.

Over To You

Have you had the experience of working with an outsourced financial controller?  Did you find it beneficial?

If you have any comments or advice to offer to others, feel free to leave a message in the comment sections.

Cost of a Part-time or Virtual Financial Controller

Are you running your own business and struggling with the finances?  You would love to have your own financial controller but you can’t afford a full time one.

You have heard someone mention part-time financial controllers and that sounds interesting.  But you are still wondering how much a part-time or virtual financial controller service would cost.

As with many of these questions, there is no simple answer.  It all depends on what you want from the service.

I have been working as a financial control for many years now.  I was a full-time financial controller when I worked with the multinationals.  Since I went freelance, I have worked as a part-time financial controller for a large number of clients in a variety of businesses.

Providing financial controller services is a professional service and these are usually priced based on the time input.  However, there are a number of different factors that influence the amount of time input.

When I meet with a potential client I will be trying to understand and evaluate their circumstances so that I can give them a proposal that is tailored to their situation.

The factors that I will be looking at will include the following

Existing Accounting Capability

How is your accounting function staffed and what level of skills are available to you?   Will we be recruiting new staff, developing existing staff, or supervising existing staff?  How much can be delegated to in-house staff and how much will be left to the part-time controller?

Accounting Systems

What sort of systems do you have?  Are these well implemented or do they need to be enhanced?  Are there standard routines or do we have to develop and install those routines?

Reporting/Analysis Requirements

What sort of reporting or analysis is required?  Is the infrastructure in place to provide this or does it have to be developed?  Has the potential client got a good handle on their revenues and costs?  Are they confident in their product or service costs?  Do they understand the reported profits or do they express surprise that the profits are not as expected?

Type of Stakeholders

What sort of stakeholders are in the business?  What requirements have they specified for reporting and analysis both in terms of frequency and detail?

Stage of the Business

At what point in the development cycle is the business. Is it a startup with external funding or plans to bring in external funding?  Is it a mature business with fairly steady sales and costs?

Challenges facing the business

What are the challenges facing the business?  Are profitability levels acceptable?   Are they undertaking any significant projects – new markets, new products, new processes, new facilities?

Once I have a good understanding of the current situation for the company, I will then start to work on defining what the desired situation should be.  As part of that, we will set some goals – a mix of development goals and some maintenance goals.

Agreed Workplan for Outsourced FC Services

From that analysis, I will create a work plan (read here on how to create a work plan) which will determine the cost of the service.  This work plan will be presented to the potential client and discussed to come up with an agreed work plan.

The level of work needed varies from company to company.  I have one company where I did a lot of work early on developing the staff and the systems and I now attend them about one half-day per quarter with additional time as they require specific, clearly identified issues.

I have other clients where I am with them for two days per month.  These clients with a higher time requirement tend to be either dealing with some major issues or are still in the development stages of the business.

With good broadband, I can also work remotely.  This can be very helpful if something crops up and it will only take a short time to resolve.  So a skype-type call will avoid travel time and can give the client the answer much more quickly.

Service Cost per month

In terms of cost, it can range from € 400-500 per quarter to maybe € 1500 per month but if the client requires greater inputs the cost will be greater.

From the client’s point of view, what they want to get from the service is the elimination of surprises, a much-improved understanding of their profitability, greater confidence when pricing for their customers, and improved profitability.

To get a better understanding of how we work, feel free to browse through our blog articles.   I suggest this article,  “Understanding the nuts and bolts of accounting”, as a good starting place.

As always, if you have any comments or questions on this article, feel free to contact me by phone(086 2323525)  or by email at jim(at)accountsplus (dot) ie.