When to hire a bookkeeper, a controller and a CFO

Owners ask us this question more than any other. The company has outgrown the owner's spreadsheet, the bookkeeper is overwhelmed, the CPA only appears at year end, and nobody is sure which finance role to hire next. The wrong answer is expensive in both directions: a CFO salary in a company that needs a controller, or a bookkeeper asked to produce a forecast for the bank.

Here is how we distinguish the three roles, the signs that tell you which one you need, and where fractional capacity fits.

What each role actually does

A bookkeeper records transactions, reconciles bank and credit card accounts, processes payables and receivables, runs payroll or works with a payroll provider, and prepares the sales tax and payroll remittances your CPA has set up. Good bookkeeping is accurate, current and consistent. It is the foundation for everything else.

A controller owns the accuracy and timeliness of the numbers. They close the month, review reconciliations, maintain the chart of accounts, manage the bookkeeper, build the management reports and are the day to day contact for your CPA. A CFO looks forward. They own the forecast, the budget, pricing and margin strategy, financing, lender and investor relationships, systems choices and the financial side of major decisions such as a new location, a large hire or a sale.

Signs you need a bookkeeper

Whether the bookkeeper is in-house or outsourced matters less than whether the work is current and reconciled every month. For many BC companies, a part-time or outsourced bookkeeper is the right answer until payroll and transaction volume justify a full-time seat.

• The owner or an administrator is doing the books in the evening
• Bank accounts have not been reconciled this month
• Invoices go out late and receivables are chased from memory
• The CPA sends a long list of questions and adjustments at year end
• Remittance deadlines cause stress or have been missed

Signs you need a controller

A controller turns a set of books into a management system. In a company with one bookkeeper, a fractional controller a few days a month is often enough to establish the close, the reporting and the controls.

• Monthly statements arrive weeks after month end, or not at all
• The numbers change after you have already used them
• You have more than one entity, location or revenue stream and cannot see them separately
• The bookkeeper is being asked for analysis, forecasts or lender packages
• You are preparing for an audit, a review engagement, a loan or an acquisition

Signs you need a CFO

Few companies under a certain size can justify a full-time CFO, and most do not need one five days a week. A fractional CFO gives you that seat for a few days a month, alongside your controller or bookkeeper and your CPA.

• Growth is straining cash and nobody can say exactly when or why
• Pricing, margins and compensation are set by instinct rather than by model
• You are negotiating with a bank, raising capital or planning an exit
• Major decisions are being made without a financial case
• The owner is the only person thinking about the future of the money

How the roles fit with your CPA

Your CPA firm prepares tax filings, year end statements and any assurance work, and advises on tax planning. None of the roles above replaces that. A good controller or CFO makes the CPA relationship cheaper and more useful by delivering clean, reconciled books and clear questions, and by bringing the CPA into decisions before they are made rather than after.

When we take a fractional CFO seat, one of the first things we do is set a quarterly rhythm with the client's CPA so tax, structure and reporting decisions are made together.

Sequencing the hires

Most companies follow the same order: a part-time bookkeeper, then a full-time bookkeeper, then a fractional controller, then a fractional CFO, then a full-time controller, and only later a full-time CFO if the scale and complexity justify it. The order can change if a financing or a sale brings the CFO need forward. What should not change is the principle: hire the role for the work that is going undone, not for the title.

Before each hire, write down the work that is not being done today, who is doing it badly instead, and what it is costing in late numbers, missed remittances or decisions made without a case. That page is the job description. It also tells you whether the work needs a full-time seat or a few days a month, which is the difference between a salary and a fractional engagement, and it gives you a clear way to judge after six months whether the hire has closed the gap.