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Managing company finances and planning continuous business development require a specialist approach. Controlling has recently become popular, helping set goals and monitor achievement. However, economic matters should be handled by experienced experts keeping up with developments in controlling and financial management. An external chief financial officer’s help can be invaluable here.
What is controlling?
Controlling manages economic activities within an organisation. It sets and monitors company goals and corrects identified errors. Its main task is achieving agreed goals while balancing future objectives and current profits. Its essence is a conscious approach to the future, allowing long-term steps towards development and organisational success to be planned.
Controlling plays a crucial role in effective company management, enabling ongoing progress tracking, problem identification and corrective action. It monitors effectiveness and raises productivity through continuous process improvement.
What are controlling’s tasks?
The most important are:
● setting goals that can be monitored,
● establishing standards and indicators to assess progress,
● monitoring operations by tracking results against standards,
● identifying and analysing problems preventing or delaying goals,
● taking corrective action to eliminate deviations.
What tools does controlling use?
Various tools and techniques support monitoring, analysis and correction of business activities.
Examples include:
● budgeting – a basic control tool covering planning, preparing and approving budgets and checking actual-versus-planned variances,
● key performance indicators (KPI, Key Performance Indicators) – monitoring progress and identifying problems in sales, quality, costs or operational efficiency,
● cost analysis – identifying and optimising costs across operations,
● risk analysis – identifying, assessing and managing risks to locate potential threats and take preventive action,
● tax audits – checking previous settlements and identifying tax overpayments,
● management reporting – regularly preparing reports on results, performance indicators and other information for ongoing progress monitoring and decisions,
● IT systems – commonly ERP (Enterprise Resource Planning) and BI (Business Intelligence), enabling data collection, analysis and reporting, process automation, advanced analysis and real-time information access.
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Who is an external chief financial officer?
An external CFO (Chief Financial Officer) fulfils the finance director’s role without being permanently employed by the business. Hiring externally avoids an additional permanent position and employee training. An external CFO is a financial management expert serving different types of businesses. Controlling is important in their work, tracking and assessing financial performance and supporting decisions.
What are a CFO’s tasks?
The most important include:
● ongoing financial and accounting support,
● cooperating with and supervising accounting and the financial controller,
● increasing company efficiency and value,
● monitoring liquidity and supporting risk avoidance,
● participating in strategic decisions,
● preparing expert revenue and cost forecasts,
● supporting budgeting,
● auditing and reducing costs such as commissions, consolidations, debt or changes to contract parameters,
● helping find external funding, such as credit, factoring, leasing, share issues or outside investors,
● auditing relationships with financial institutions and recommending next steps,
● negotiating and representing client interests,
● helping complete credit documentation.
An external CFO – why is it worthwhile?
More businesses outsource services to external firms. This includes not only accounting but also roles such as CFO. Recruiting experienced staff for this position can be time-consuming, so companies choose external CFOs offering knowledge, experience and cooperation with leading professionals.
Entrusting finances to an external CFO saves time because their accounting firm also offers other experts. It optimises costs, as professional advice is paid through an advisory subscription. The CFO helps restore peace of mind by representing your interests with financial institutions and contacting other companies. You will quickly appreciate the convenience of mobile contact with financial experts.
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