The success of any M&A transaction depends heavily on financial precision. From due diligence to post-merger integration, errors or oversights can derail the entire deal, leading to costly disputes or even failure. While organizations may have in-house financial teams, the unique demands of M&A often call for specialized support. 

Learn about our M&A Advisory Services.

This is where outsourced accountants step in. These professionals bring deep expertise, objective analysis, and scalable solutions necessary to handle the intricate financial details that M&A demands. Below, we’ll explore the roles outsourced accountants play during M&A processes and showcase three real-world examples of how their involvement has driven success. 

The Role of Outsourced Accountants in M&A 

1. Ensuring Accurate Due Diligence 

Due diligence is the backbone of any M&A transaction. It involves scrutinizing the financial health of the target company to confirm its valuation, identify liabilities, and ensure compliance with regulations. Outsourced accountants are highly skilled at conducting comprehensive due diligence. They dig into financial statements, tax records, and other documents to paint a complete picture of the target company’s financial position. 

Their expertise ensures that potential risks are identified early, and data integrity remains intact—allowing decision-makers to negotiate with confidence. 

2. Valuation Expertise and Financial Insights 

Determining the fair value of a company is far from straightforward. Valuations are influenced by a myriad of factors, including market trends, financial forecasts, and operational assets. Outsourced accountants provide unbiased valuations, free from potential internal biases or organizational pressures. By using advanced financial models and analysis, they ensure accurate assessments of profitability and growth potential, offering insights that both buyers and sellers can rely on. 

3. Streamlining Financial Integration 

Post-merger, financial integration is essential to combine two entities smoothly. Disparate accounting systems, processes, and policies often need unification—while maintaining operational continuity. Outsourced accountants specialize in this area, helping companies harmonize systems, ensure compliance, and implement new financial workflows. Their expertise reduces disruptions, enhances reporting accuracy, and speeds up integration timelines. 

4. Strengthening Regulatory Compliance 

M&A transactions often trigger regulatory oversight, from antitrust evaluations to compliance with financial reporting laws. For businesses operating across multiple jurisdictions, maintaining compliance can be particularly challenging. Outsourced accountants are well-versed in regulatory requirements and help businesses adhere to complex laws, minimizing legal risks during the transaction process. 

Real-World Examples

Example 1: Mitigating Risk During Due Diligence 

A US-based e-commerce company sought to acquire a smaller competitor to expand its market footprint. The deal appeared promising—until outsourced accountants uncovered several undisclosed liabilities during the due diligence process. These liabilities included unpaid vendor debts and errors in revenue recognition practices that inflated the target company’s financial performance. 

Rather than abandoning the deal outright, the e-commerce company adjusted its offer, negotiating a reduced purchase price to account for the hidden risks. This adjustment saved millions and allowed the acquiring company to proceed confidently, knowing it wasn’t inheriting financial surprises. 

Example 2: Smoothing Financial Integration Post-Merger 

Two regional logistics firms merged to form a national-level carrier. Both companies used different accounting systems and operational workflows, which threatened to delay the post-merger integration process. By engaging outsourced accountants, the unified company received guidance on implementing a centralized accounting platform, harmonizing processes, and maintaining reporting accuracy during the transition. 

The outsourced team also provided training to the internal finance department, ensuring staff could independently manage the new system moving forward. Within six months, the integrated financial system was fully operational, allowing the merged company to focus on achieving its growth objectives. 

Example 3: Enhancing Valuation Accuracy for Investors 

A software-as-a-service (SaaS) startup undergoing acquisition needed to present accurate financial records to attract private equity buyers. They hired outsourced accountants to review historical data, clean up their financial records, and develop future revenue projections. The external team uncovered discrepancies in customer churn calculations that had previously been ignored, as well as opportunities to improve profit margins by optimizing subscription tiers. 

Armed with these insights, the SaaS company increased its valuation and secured competitive offers from multiple investors. The outsourced accountants’ contributions directly influenced their ability to attract favorable terms and secure scalable growth funding. 

Why Fully Accountable’s Outsourced Accountants Are Your M&A Advantage 

Mergers and acquisitions are high-pressure events with no room for financial errors. Fully Accountable’s outsourced accountants bring the tools, experience, and insights necessary to ensure success during every stage of the process. 

Our team specializes in providing tailored support for businesses, particularly those in e-commerce and digital industries, so you can focus on strategic growth while we handle the complexities of financial management. 

Here’s how we make an impact during M&A transactions:

• Comprehensive Due Diligence: We identify risks, ensure data accuracy, and help you negotiate deals with confidence. 
• Accurate Valuations: Our insightful analyses and financial models provide clarity on your company’s worth, ensuring fair outcomes for all parties. 
• Seamless Integration Support: From harmonizing accounting systems to aligning workflows, we ensure smooth post-merger transitions. 
• Regulatory Expertise: We help you stay compliant with financial reporting and tax regulations, minimizing legal risks. 

Trusted Guidance When You Need It Most 

Don’t take chances with your next merger or acquisition. Whether you’re the buyer or seller, Fully Accountable is your trusted financial partner. Contact us today to learn how our outsourced accountants can guide you through M&A transactions, from due diligence to integration, and help your business emerge stronger and more profitable. 

Take the first step toward financial clarity. Reach out to Fully Accountable now to secure success in your next M&A venture!

The post Why Outsourced Accountants Are Critical During Mergers and Acquisitions appeared first on Fully Accountable.

In this blog, we’re looking at the differences between accrual and cash basis accounting and which one you should use depending on your company’s current financial situation. 

At Fully Accountable, we’re committed to providing you with the accounting method that makes the most sense for your business. That’s why our full-service accounting team offers fractional digital accounting services that simplify compliance and create larger financial strategies.

Continue reading to learn more about the differences between cash basis and accrual accounting. 

An Overview of Accrual Vs. Cash Accounting

The fundamental difference between accrual and cash accounting is the timeframe of the revenue and expenses. Cash method accounting immediately recognizes revenue and expenses while accrual focuses on anticipated revenue and expenses. 

Accrual then, records revenue and expenses when cash related to these transactions is received or dispensed. This provides a more accurate view of a company’s financial health by including accounts payable and receivable. 

The accrual method is the more commonly used method among larger companies, especially publicly-traded companies because it provides a more comprehensive overview of earnings over time. Cash basis accounting is primarily used by smaller businesses. 

What Does It Mean to Record Transactions?

Recording transactions refers to the point at which you record incoming revenue. By law, every business has to record all its financial transactions. If you want to claim tax deductions at the end of the year, you’ll need a central location to add all your income and expenses. Recording transactions refers to when you decide to do this process.

What Is Accrual Accounting?

Accrual accounting includes revenue once earned. This differs from the cash method because accrual records revenue when a product or service gets delivered to a customer with the expectation that money will be paid in the future. Revenue is then counted before it is formally received. The money for goods and services is also recorded before any cash gets paid out. 

What Is Cash Basis Accounting?

Cash basis accounting only reports revenue on the income once cash is received and expenses are only recorded when cash gets paid out. Cash method accounting is typically reserved for small businesses and personal finances. 

What Are the Differences Between Accrual Accounting and the Cash Method?

Accrual Method

The accrual method of accounting records all accounts payable and receivable, which paints a much clearer picture of the profitability and stability of a company, especially in the long term. Under the cash method, a company would likely have solidified sales that wouldn’t be recorded until the following quarter. Investors might mistakenly consider the company unprofitable when the company’s doing well. 

The drawback of the accrual method is that it doesn’t account for cash flow. Because it records finances over a longer period of time, it might not display cash flow shortages in the short term. It can also be more complex since it accounts for elements, such as unearned revenue and prepaid expenses. 

Accrual method accounting is accepted under the generally accepted accounting principles from the Financial Accounting Standards Boards and it is typically reserved for companies that file audited financial statements. 

Cash Basis Method

Cash basis accounting features the advantage of simplicity and it only accounts for the cash paid or received. Sole proprietorships and small businesses typically use this method because it displays cash flow health, which is especially important when you’re beginning. Showcasing longer-term financial health is more important as you grow. 

However, cash basis accounting might over-exaggerate a company’s financial health when it’s cash flow is positive. It doesn’t account for the natural financial fluctuations that occur over time. This is because it doesn’t record the company’s cash flow on the books outside of its current revenue stream. 

As a result, investors can evaluate the company as profitable when it’s simply cash flow positive for that given period. Unlike the accrual method, the cash basis accounting method is not acceptable under the GAAP. However, as of 2018, small businesses with annual gross receipts of $25 million or less in the prior three-year period can use it.

Some Considerations 

The accrual method is used more prevalently among publicly-traded companies. One reason for the popularity among publicly-traded companies is that this method smooths earnings out over time while cash basis accounting records more immediately. 

For example, if a retail business used the cash basis accounting method, it might look abnormally profitable during quarter four and abnormally unprofitable in quarter one. Both methods have advantages, and it is up to your company to decide which method suits your company best. Investors must understand how both methods impact investment decisions. 

How to Choose the Right Accounting Method for Your Business 

For small companies that conduct business primarily through cash transactions and who do not maintain large inventories of products, cash basis accounting often makes more sense. This method offers a more convenient way to keep tabs on revenue and expenses without an abnormal amount of bookkeeping. 

While ease accompanies the cash basis accounting method, you receive a more an accurate picture of your finances with accrual accounting. Here are some factors you will want to consider while deciding whether cash basis or accrual accounting is the right decision for your business: 

The Complexity of Your Business

Depending on your business, one accounting method will be more sustainable than the other. Businesses with multiple accounts, hundreds of employees, and multiple LLCs should stay away from cash basis accounting because they need to present the big-picture view to potential investors. 

Sales Revenue

Another reason you should choose one accounting method over another is your sales revenue. According to GAAP, any business that exceeds $25 million in annual revenue should use the accrual accounting method. 

Publicly-Traded Companies 

Owning a publicly-traded company or one on the verge of going public might also affect GAAP guidelines. Publicly-traded companies must report accurate views of their financial well-being to shareholders. The best method for this is the accrual system of accounting. 

Hybrid Methods of Accounting

Some small businesses use a hybrid accounting system. They might base large financial decisions on loan applications and accrual accounting but utilize cash basis accounting to simplify their tax accounting. A substantial number of rules govern which businesses can implement hybrid accounting, so you should speak to an accountant or tax professional before implementing this into your business. 

Bottom Line- Should I Use Accrual or Cash Basis Accounting?

Deciding whether you should use cash basis or accrual accounting for your business depends on the size of your company and when you would like to record transactions. As we’ve discussed, accrual accounting gives you a more complete picture of your business’s financial health over time. Cash basis gives you a shorter window into your financial health but can reveal short-term cash flow dynamics.
If you struggle with deciding which would fit your organization best, contact the professionals at Fully Accountable. Our accounting firm prides itself on implementing the correct procedures at your company to improve your bottom line and ensure you accomplish sustainable expansion over time.

The post Should I Use Accrual or Cash Method for Accounting? appeared first on Fully Accountable.

While price increases might seem inevitable, there are other options. Additionally, there are precision pricing strategies that prevent damages to your customer loyalty if you need to increase prices. These strategies can help you avoid lost profits and hits to your shareholder value. 

In the following blog, we cover how your business can not only survive inflationary periods such as this. Whether you use outsourced financial analysis or controller services, Fully Accountable can help you turn inflationary periods into prosperous times when your business can increase your market share and deepen customer loyalty. Continue reading to learn how you can adapt your financial strategy during times of inflation such as the ones we face today. 

Facing the Current Uncertainty 

You’ve likely heard the word “unprecedented” a lot over the past few years to describe our current business environment. Customers’ confidence in the economy has suffered. With inflation at a 40-year high and the world economy reeling from a pandemic and Russia’s invasion of Ukraine, it’s tough to see the forest through the trees. 

The challenge companies face today is how to keep their customers loyal in an environment that financially strains both consumers and businesses. As this article suggests, the best place to look for answers is internally. Insight into operations, data analysis, decisive action, and strengthened business relationships can help curb at least some of the stress from tough financial times. 

How Does Inflation Affect Growth and Stability?

During times of inflation, companies must keep the difference between gross profit and gross margin in mind. You can increase revenue by raising prices and create the appearance of growth. However, if you ignore your gross margin when you do this, you become less profitable over time and you will wind up hurting shareholder value. 

The most important metric for shareholders is profitable growth, which equates to your ability to grow revenue at the same time as profit. The challenge with inflation comes from passing cost increases while maintaining margins and retaining loyal customers. Because of this, companies must be careful of relying on price increases during times of inflation. 

How Important Is It to Stay Agile During Times of Inflation?

Your business’s financial decisions need to accelerate during times of inflation. You must monitor every change you make closely and adjust quickly. Enacting a single strategy during times of inflation will likely wind up in failure. You need to continuously test and adapt. 

What Options Do Companies Have Besides Raising Prices?

Contrary to what you might think, raising prices during inflation isn’t always the most effective way to combat inflation. The most effective way to combat times of inflation is to look internally at potential inefficiencies in your financial processes.  

Doing so can reduce costs wherever possible so you can retain your customer loyalty during a time when your competitors are likely to lose it. Most companies don’t even measure the cost of inefficient operations. For example, your client might order three times throughout their buying cycle instead of making one large purchase. 

This behavior requires more shipping costs and man hours to conduct follow ups. Processing returns can also cost money that companies rarely account for, particularly during times of financial stress. 

As you can see, even if a customer seems profitable, they can quickly eat into your overall profit from the various costs they incur. Looking inward to discover these inefficiencies helps you implement solutions to lost profits rather than relying on price increases. 

How Can Companies Use Challenging Times to Improve Processes?

The easiest way for companies to respond to these situations is by interpreting data. The only way to be certain of the efficacy of your solution is to test it relentlessly. You should have daily, weekly, monthly, and quarterly analyses running to ensure your solution is actually effective. You should already know which items are struggling to sell, what accounts can handle a price increase, and the areas of your business that continue to bleed your profits. 

Is a Single Approach Best for Price Increases?

Consumers have the power in times of inflation because, similar to your business, they’re trying to cut costs. Because of this, you need to incorporate multiple price strategies to see which ones are most effective. Consumers can choose another vendor and substitute their decisions with generic or cheaper products.

Your CFO should be able to combine market support with customer profiling. Your financial strategy should address who can uphold a price increase and who would be likely to seek elsewhere. 

Consider the Long-Term Implications of Your Strategy

You need to be careful if you plan to implement a price increase. Careful price increases account for the long-term implications of a price increase rather than focusing on short-term solutions. Remember, customers should expect some price increases, but those should be within reason. 

When the situation turns for the better, your company should be able to quickly establish itself as the one who gains your customers’ trust. The only way to do this is with highly-specific price increases. 

Even though price increases might be unavoidable, there are still ways for you to incorporate long-term tactics aimed at retention. In distribution, you can partner with customers and identify products in your supply chain that you can substitute to save money. 

Communicating about the rationale behind your price increase is also critical. However, that should occur in the context of your overall service and strategy, rather than price alone. 

Don’t Panic 

Many companies push the panic button during times of economic turmoil. That’s normal. However, if history has shown us anything, it’s that tough economic times give way to prosperity. A deflationary period is virtually inevitable and your inflation strategy should be based around this deflationary period. Limited lost profits and reduced costs in problem areas can alleviate your company’s inflation woes. 

The companies that last the longest understand the big picture rather than getting bogged down by temporary challenges. During difficult times such as these, the best companies take it as an opportunity to deepen customers’ connection to the company. They aren’t merely concerned with profit margin. They take their focus and use it to win additional market share because most companies aren’t focused on customer loyalty during tough financial times. 

When the dust settles, these companies are prepared to reap the rewards of a loyal customer base. 

Fully Accountable Can Help

At Fully Accountable, our outsourced CFO services ensure you have a strategic partner who can capture the market share you need to retain your profits and shareholder value. We understand the financial professional of the future isn’t merely concerned with compliance and number-crunching. Our strategic CFO services are here to help during times of inflation so you can retain customer loyalty without implementing price increases that drive away business.
Contact us today to learn more about our services and how they can help you through trying times.

The post How to Adapt Your Financial Strategy During Times of Inflation appeared first on Fully Accountable.

In this article, we’re looking at the ways your balance sheet can help you maintain a healthy financial standing. While planning your balance sheet takes some careful deliberation, the financial experts at Fully Accountable can help you take advantage of your business’s strengths so you can achieve sustained success.

But how do you make a balance sheet and do you know how to incorporate a balance sheet audit checklist? Continue reading to learn all there is to know about your business’s balance sheet.

What Is a Balance Sheet?

Businesses have three primary documents that help analysts and owners assess their company’s health. The income statement, cash flow statement, and balance sheet all have deep impacts on a company’s financial success. The balance sheet is the most important sheet for forecasting financial projections and gives you a detailed summary of all assets, liabilities, and the equity of the company. It can determine your company’s financial obligations and show you the best ways to invest your money. Lastly, balance sheets show you your business’s progress and how you can track financial performance.

What Comprises a Business Balance Sheet?

Not all business balance sheets will have the same metrics, but most have at least the following components: current assets, liabilities, and shareholder equity.

Current Assets

Assets describe anything a company owns outright. This can include both tangible and intangible assets and you can further separate these categories into liquid and fixed assets. Liquid assets describe assets that can readily be converted into cash. Fixed assets describe property such as land owned by your company in the form of buildings or company equipment.

Intangible assets are assets that aren’t physical but are under the sole ownership of the company. These assets bring increased value to the company through things such as patents, copyrights, brand names, intellectual property, and the company’s goodwill. The sum of these tangible and intangible assets comprises the company’s total assets and helps you create an accurate balance sheet.

Liabilities

All of your company’s debts together comprise your liabilities. The liabilities section of a balance sheet includes mortgages, bank loans, expenses, or other obligations you need to pay. Liabilities can be separated into short-term liabilities due to be paid back within the year and long-term liabilities that are not due within the year.

Short-term liabilities include items such as office supplies, marketing expenses, payroll taxes, and short-term loan payments. Long-term liabilities include things such as deferred liabilities and bond payments.

Shareholder Equity

Shareholder equity or owner’s equity is the sum of the money owners will get if the business’s assets need to be liquidated and all the debts and liabilities get paid off. This does not include retained earnings or earnings you need to reinvest. Payment proposed for the repayment of debts is not included in the owner’s equity. From this section in the balance sheet, shareholders automatically have access to the business’s performance and stability. If your company is performing well within its market, the shareholder equity will increase.

Are Business Balance Sheets Important?

It’s natural to question how important the business balance sheet is to your success. You can answer this question by looking at what this sheet provides you. Regardless of your company size, the business balance sheet reveals vital information about your performance. To start, the balance sheet can be one of the most useful documents for your business, even if you are just beginning.

Outside of keeping a record of debits and credit, the balance sheet allows you to compare your business progress and metrics with other enterprises in your industry. Maintaining these comparisons and monitoring your progress and metrics with other enterprises will help your business continue to grow. Balance sheets also keep all of your most important employees on the same page about capital availability, assets, and potential losses, or gains.

Balance sheets also help you determine whether you should take more debt or increase or decrease the current interest rate. You can take your financial decisions

How to Prepare Your Balance Sheet

Once you understand the components of your balance sheet, you can start to create it. There are plenty of software programs and templates available. To begin your balance sheet, start by following these steps:

1. Determine whether you want to report for the month, quarter, or year.
2. Gather all of your financial information.
3. Fill in the correct amounts of assets and liabilities. Assets should be on the left and liabilities should be on the right.
4. Examine your retained earnings or equity.
5. Balance both sides out.

Understanding Your Balance Sheet

After filling out your balance sheet, you should start the analysis process. Balance sheets can offer many intriguing insights. These include your company’s net worth, areas that require more organization, progress over time, and the ability to assess whether your business is attractive to other lenders. You can also use your balance sheet to calculate any key ratios. Key ratios help you understand your business’s financial standing.

The following metrics help you determine your financial standing:

Debt Ratio: The debt ratio helps you determine your financial status by determining your total liabilities against your total assets. Your debt ratio = total liabilities/total assets.

Working capital: Working capital refers to the funds you use to cover operating costs. They can be calculated using the working capital = current assets – current liabilities formula.

Debt-to-Equity Ratio: The debt-to-equity ratio reveals your business’s capital leverage and whether the majority of your debt or shareholders’ equity. You can calculate it by dividing your total liabilities by your total equity.

Balance Sheet FAQs

Do Small Businesses Need Balance Sheets?

While balance sheets are not necessarily required, business owners should create and maintain these statements to help prioritize their business initiatives. You might be able to also improve your financial leverage with potential lenders or investors.

What’s the Difference Between an Income Sheet and a Balance Sheet?

The difference between an income statement and a balance sheet can be represented by the layout they use. Balance statements show a company’s assets, liabilities, and equity at a specific point in time while income statements reveal revenues and expenses over an extended time.

Conclusion – Maintaining Your Balance Sheet This Summer

Creating a balance sheet is critical to solidifying your business’s financial success. It essentially creates a snapshot of all of your assets, liabilities, and shareholder equity. This tool isn’t only used for shareholders, but for the company as a whole.

Using your balance sheet, you will be able to make more informed financial decisions about the future of your company. At Fully Accountable, we believe you should have access to a team of financial professionals who can guide you to the right financial decisions, no matter what type of industry your company is in.

If you’re wondering how to maximize the value of your balance sheet, contact us today. Our outsourced accounting services can help you take advantage of all your unrealized profits.

The post Maintaining Your Business Balance Sheet This Summer appeared first on Fully Accountable.

From identifying peak on and offseasons to adjusting your inventory levels and forecasting your cash flow, this article looks at how businesses can maintain a positive cash flow throughout the summer. It also looks deeper into how businesses can analyze how their sales fluctuate throughout the year to create a more comprehensive and adaptable cash flow strategy.

If you’re wondering how to plan a proper cash flow budget, look no further. At Fully Accountable, our financial professionals understand how to tailor your accounting strategy to maximize your profits and stabilize your business model. With digital accounting software, a full-service team of financial professionals, and a commitment to impeccable digital accounting services, we can ensure you stay on top of your cash flow plan year-round.

Identify Peak On and Off Seasons

Planning your summer cash flow strategy will differ depending on your industry. You must first understand when your most profitable seasons are and when you are liable to enter a lull. Depending on your products and services, seasonal cash flows typically peak during either summer or winter. You will likely be able to identify these two points but the exact starting point of the upward curve will require extensive research.

Additionally, your business might have a sharper curve than others. Regardless of your upward and downward trends in profitability, once you understand these curves, you will be able to better plan for your cash flow. Try improving your product or service during your down season and maximizing sales during your peak season to achieve optimal cash flow balance during both times.

Adjust Your Inventory Levels

Analyzing your high and low seasons will help you identify the optimal inventory levels for your business. You should revisit these levels frequently to determine the demand within your cycle. You can’t forget that the demand cycle can also affect the volume of your orders and their volatility. Your inventory numbers should account for sales cycle demand and volatility. For example, you might want to increase buffer stock when volatility is higher.

Understand Your Costs

You can’t take advantage of your cash flow unless you thoroughly understand what is going out and what is coming in. Understanding your cash flow will help you identify both fixed and variable costs, which play heavily into how you create a budget. Examine which fixed costs are necessary and which you can cut to take full advantage of your cash flow plan.

Though you are more likely to save on variable costs, you likely won’t need to pay all your bills year-round. For example, if you have seasonal facilities, you shouldn’t be paying for utility costs year-round. You should also review all of your software licenses and subscriptions to get rid of those you don’t need for peak season.

Forecast Your Cash Flow

To adjust to cash flow issues, you need to be able to forecast all of your budgets. You should be able to analyze your cash flow for at least 12 months and predict it as far forward as 18 months. If you do this well, you will be able to predict seasonal cash flow problems in advance and adjust.

Businesses often use cash flow forecasting to help during times of financial trouble. However, healthy businesses can also use cash flow forecasting to uncover liquid cash reserves available at all times. By remaining aware of the required expenditures and when you will need to pay them, seasonal businesses can protect themselves from unexpected obstacles that can potentially lead to cash shortages during the offseason.

Uncover New Sources of Revenue

Off seasons give businesses the opportunity to reevaluate their cash flow initiatives. They can do this by forming a complementary sales channel for a product or service or developing a new product or service to add to their offerings for their high season. Finding innovative ways to improve your revenue helps your business pivot in the offseason so you can maintain a higher level of cash flow.

Create a Budget and Stick to It

While many businesses have seasonal schedules, many of them map out their long-term business initiatives during the year. They plan with long-term goals in mind and shift their goals as needed. Budgeting is essential for any company that wants to stay positive in the long term. And more importantly, it’s not just about the companies that create a budget. You need to stick to a budget.

Identify clear objectives and decide how you want to achieve those objectives. Cash flow forecasting and budgeting are essential for any seasonal enterprise and with them, you will maintain your working capital throughout the year. Additionally, analyzing when your slow season will start and paying attention to the times of the year when you have the most fixed and variable expenses will be able to help you further plan out your cash flow initiatives in advance.

Refine Your Forecasts

Forecasting your cash flow takes extensive planning and you should revisit your plan every month. Once you finish the month, you should record what worked and what came up short. This way, you will be able to modify your existing plan to ensure you have a complete program at all times.

Updating your cash flow regularly will help you update your forecasts, identify cash shortages, and benefit from higher revenue periods when you have cash surpluses. Digital accounting software can simplify this process greatly.

Understand Best and Worst-Case Scenarios

Understanding your cash flow isn’t only about understanding the best-case scenario for your cash flow plan. It’s also about being prepared for the worst. A cash flow scenario where you create flexibility for yourself is advisable. Creating a flexible cash flow scenario helps you explore whether you will need to apply for a loan, line of credit, or another funding source during the tougher financial times.

Secure a Business Line of Credit

Even after creating a complete cash flow forecast, you will likely encounter times of unexpected expenses, lower revenue, and larger purchases. Unforeseen costs are an inevitable part of running a business and your cash flow plan must be prepared to handle them. Business financing is an excellent backup plan during these times.

Thinking ahead and analyzing your financing options should take you up to several months before approaching the slow season. You should make an appointment with your bank to discuss your financial needs and you might be able to secure a line of credit at a lower interest rate than other forms of credit. To do so, banks typically need to see your business plan. Consider creating one as soon as you can.

Conclusion – Cash Flow Budgeting This Summer

Whether your business has a down season in the summer or you’re in a high season, you need to make sure you stay on top of your cash flow initiatives. Planning your cash flow with outsourced financial management services such as Fully Accountable ensures you are prepared for all the curveballs the year throws at you.

Devise a plan for your cash flow strategy with the experts at Fully Accountable and don’t leave any funds on the table this year.

Contact us today to start planning your cash flow.

The post Cash Flow Budgeting This Summer (2022): How Are You Progressing Toward Your Financial and Operational Goals? appeared first on Fully Accountable.

Innovative e-commerce accounting software solutions and the right financial professionals on your team can help you navigate these challenges and emerge on top of the e-commerce food chain. As e-commerce evolves as a whole, 2025 will present emerging businesses with acquisition opportunities and an ever-growing market flooded with consumers shifting to an online purchasing model.

At Fully Accountable, our team of accounting controllers and fractional CFOs combine the latest e-commerce accounting software with superior business strategies. If you’re looking to navigate the challenges e-commerce businesses face in 2025, you need foolproof financial directives and a confident approach. Continue reading to learn financial strategies for businesses that will help your e-commerce business grow.

Combating Inflation

While inflation has come down significantly since mid-2022, it’s still above average. Much of this is due to the supply chain issues facing e-commerce companies.

Housing, cost of labor, energy – you name it – prices are up. Business programs such as the Paycheck Protection Program have stimulated the markets. Because the government has been giving consumers money, businesses have been able to sell despite inflation. With those programs winding down, it remains to be seen whether consumers will continue their buying habits. This type of activity has recession written all over it and e-commerce businesses would find it wise to implement contingency plans.

E-commerce companies should plan for continued inflation, which means higher inventory, labor, and shipping costs. Essentially, you should plan on everything being more expensive in 2025.

Beware of Interest Rates

The Federal Reserve raised interest rates several times since the pandemic, making it more expensive to borrow money in the hopes of reducing inflation. With inflation trending down in 2024, the Fed is finally lowering interest rates, but the wheels of government are infamous for moving at a glacial pace. Because of this, e-commerce businesses must closely consider how raising capital will affect their cash flow.

E-commerce business owners should plan for more expensive business loans and credit lines. They should consider refinancing loans due to historic lows and try to lock in rates for debt if they can. Lastly, if you are considering financing, you should do it ASAP.

Supply Chain Problems

Supply chain issues were a major concern during and after the pandemic, but the issue has largely diminished in recent years, but it’s more present than ever in the minds of e-commerce store owners who rely on overseas suppliers.

Not meeting demand leads to lost sales, which can ruin financial projections. You should order in further advance, carry more inventory to account for delays, budget for increased costs, and stay informed of price increases.

Utilize Acquisitions

Recently, there have been numerous acquisitions for businesses conducting eCommerce. Since there is substantial cash flow in markets, aggregators have begun buying direct-to-consumer businesses. In other words, if you are consistently turning a profit, you’re in high demand right now. Private equity firms are also looking for returns on their funds raised.

With the continued increase of eCommerce businesses, the long-term benefits of acquiring eCommerce businesses are appealing to larger companies and institutions. Whether you’re looking to buy an eCommerce store or sell your own, 2025 will be a good time to consider both.

Increasing Payment Methods

Customers will continue seeking more convenient payment methods in 2025 and eCommerce businesses need to respond to the increased demand. Providing a full suite of payment options is an easy way to increase sales. Decreasing customers’ checkout time builds trust in your brand and ensures your customers notice how convenient you make their purchasing experience.

eCommerce companies should also be on the cutting edge of technology. Here are some of the payment options eCommerce companies should consider implementing in their businesses:

• Apple pay and fingerprint payments through smartphones: half the iPhone users out there utilize Apple Pay for purchases, with that number growing every year. E-commerce businesses would do well to implement advanced payment methods into their company payment structure.
• Bitcoin and other blockchain currencies: cryptocurrencies continue to affect consumers’ daily lives and your eCommerce business should capitalize on this growing number. More and more companies are considering these valid payment options.
• Fintech options: Fintech options such as Klarna make it possible for customers to buy now and pay later. PayPal, for example, has implemented a “Pay in 3 offer” making it easy for customers to spread out their transactions over longer affordable durations.

Instant Analytics and Sales Optimization

E-commerce platforms, such as Shopify, have analytics tools for tracking sales, customer demographics, inventory, and more. With real-time analytics in-hand, upcoming e-commerce companies can adjust to a rapidly changing markets and streamline the sales process.

If you combine these tools with machine learning, you can make more informed sales projections and determine where you are losing sales, minimizing your bounce rate and cart abandonment.

Excitement Around Growth

Despite all of the obstacles the pandemic has brought, there still remains a silver lining. Throughout the pandemic, e-commerce has increased and shows no signs of slowing. E-commerce retailers face market opportunities if they navigate the supply chain and inflation challenges correctly. Acquisitions and inventory control are critical for e-commerce companies wanting to stay relevant.

With the threat of further lockdowns and the pandemic still looming, consumers are likely to continue to commit to their purchasing habits. In other words, online shopping is here to stay. The more companies can take advantage of this shift, the more prosperous they will be in the future.

Fully Accountable Will Guide You to Sustained Financial Success In the New eCommerce Landscape

The past few years represent a seismic shift in the business landscape. The ongoing pandemic has fundamentally changed the way consumers view their shopping experience. With the overall market volatility caused by the pandemic, there is a tendency for companies to shy away from the challenges they face.

Change opens doors for advancement, and the eCommerce companies that take advantage of these emerging opportunities will achieve the success and growth they desire.

Hiring a team of financial professionals such as Fully Accountable maximizes your ability to make smart strategic financial decisions and take advantage of the new e-commerce landscape. Navigating the e-commerce landscape can be tricky and present high-risk rates. With supply chain issues, changing tax nexuses, and high competition, you need proven strategies from financial professionals who know how to get you results.

Contact Fully Accountable today and put your eCommerce business’s financial success in the hands of controllers and fractional CFOs who understand how eCommerce is changing. The opportunities are ripe for the picking; you just need to know where to find the fruit.

The post 2025 Financial Strategies for E-commerce Companies appeared first on Fully Accountable.

In the rapidly changing tax environment, especially with the emerging laws surrounding e-commerce, businesses should be aware of the potential impacts taxes can have on their cash flow. Tax credits can play a significant role in reducing tax liabilities and improving cash flow through taxes. Since tax laws can change throughout the year, it’s important to enlist the help of professionals whose sole responsibility revolves around staying up to date with compliance issues. Additionally, these professionals issue expert insight into how small businesses can anticipate changes in the tax code to ensure they stay ahead of the curve and use their tax obligations as an advantage instead of a hindrance.

At Fully Accountable, we believe businesses of all sizes and industries shouldn’t have to live in fear of whether tax season will hurt their financial status and opportunities. That’s why our full-service team of fractional tax professionals offers tax planning guidance so you can retain your positive cash flow. Continue reading to learn about some of the measures businesses can implement to ensure their tax strategy aligns with their cash flow goals for the year ahead. 

Understand the Difference Between Book and Tax Planning 

Companies use different tax reporting methods depending on their size and the products and services they offer. For example, tax planning for an e-commerce business will require strategies different from those utilized in a traditional brick-and-mortar business. To effectively manage taxes, it is crucial to calculate operating cash flow, focusing on the impact of taxes and understanding local tax regulations. Whether you use an accrual or cash method depends on several factors that your CPA or accounting firm should clearly relate to you.

Your financial team should be able to explain your reporting strategy in terms that make sense. You shouldn’t blindly accept what your accountant suggests. While they are financial professionals, the best-outsourced accounting firms include clearly defined financial strategies regarding your tax plan, including how revenue and expenses impact taxable income.

Clearly Understand Your Tax Obligations 

It’s easy for business owners (especially e-commerce businesses) to overlook their tax obligations. Sales and use taxes are among the most commonly overlooked tax obligations. Proper tax planning, which involves understanding the role of income tax in assessing overall tax situations, is crucial for maintaining healthy cash flow. If you commit sales where your company doesn’t have a physical presence, you might be responsible for collecting and remitting taxes from out-of-state providers that don’t collect sales tax. This can cause complications as every state has a particular set of regulations.

Some municipalities even have location-specific tax nexuses. New York City’s commercial rent tax is an example of such a tax, which stipulates that tenants in certain regions of Manhattan have to pay an annual threshold.

Owners of sole proprietorships and partnerships might also neglect to add the self-employment tax on top of their income taxes. Whereas employers typically pay the Social Security and Medicare tax for W-2 employees, sole proprietors or partnerships have to shoulder this tax burden, and many are unaware of their responsibility to do so. Minimizing tax liability through comprehensive tax services and expert strategies can help manage these tax obligations efficiently.

Set Aside Tax Money Each Month 

You might subscribe to the notion that you need to pump all of your available funds back into your business. A cash flow budget is essential for tracking and managing your cash inflows and outflows. While this strategy has merit, it can have damaging effects when it comes to balancing your tax plan with positive cash flow. Yes, you need to invest in your business to achieve growth, but you shouldn’t do so at the expense of your tax obligations. Set aside a percentage of your revenue and dedicate funds specifically to your tax obligations. 

If you have an “S” corporation and you’re earning a salary, you can set aside tax funds each month. Doing so prevents you from having to dedicate a lump sum at the end of the year that can hinder the health of your cash flow.  

If you own an LLC or sole proprietorship, you should allocate some of each draw to a tax saving account. When it comes time to pay your estimated taxes, you can pay them out of the savings account. 

You can think of withholding your taxes as a trust fund situation. In this model, you are the trustee holding the funds on behalf of others. Because they will eventually be paid as taxes, you shouldn’t treat these funds as yours; they belong to the government.  

Regularly Check Your Projections

Setting aside funds to pay the IRS doesn’t protect you from owing more to the IRS than anticipated. If you enjoy a better-than-anticipated year, you will have to re-evaluate your cash flow analysis to enhance cash flow. Tax forecasting can help you keep pace with your projections as they change, but it’s best to re-evaluate these projections as the year progresses.

Most small business owners have a general idea of their projected revenue and tax obligations. However, things change, and the last thing you need when it comes to cash flow is to be blindsided at the end of the year. Understanding cash flows from various activities, including operations and financing, is crucial for sustainable business growth. Your accounting team should prepare multiple forecasts annually to ensure you stay on top of your cash flow opportunities. A common strategy is to evaluate your taxes after filing them in April. The team should also issue a second report around November to prepare for the end of the year’s projected income.

Utilized Outsourced Help 

The US tax code is thousands of pages long and changes regularly. At the state and municipal levels, there are also ever-changing tax statutes. The complications can be nearly impossible to track for a small business owner. Outsourcing can help businesses generate cash from their core activities by allowing them to focus on what they do best.

Keeping up with the nuances of tax codes is challenging enough for professionals, let alone for a small business owner trying to stay on top of growing their business, generating revenue, building brand reputation and awareness, and the complexities of employee and customer management. Outsourcing your tax planning for your cash flow affords you essential bandwidth so you can focus on running your business operations and improving your bottom line. 

Understanding your tax obligations and planning ahead for tax season helps you save money and reduces stress when it comes time to pay the IRS. Having a proactive approach to taxes is one of the most important aspects of ensuring the health of your burgeoning business’s cash flow. 

Combine Tax Planning and Financial Planning 

Financial strategy and tax planning operate in tandem. They are not separate entities, and having an accounting team on your side helps merge these essential business components to increase cash flow. Merging these areas keeps your cash flow positive and improves your bottom line while scaling sustainably.

Companies that neglect to merge these two areas will likely find themselves in hot water when tax season rolls around. Businesses don’t fail by trying too hard. They fail when they ignore the writing on the wall. Tax planning makes up a substantial portion of that writing and has a profound impact on companies’ cash flow. Additionally, understanding and managing operating cash flow is crucial for maintaining financial stability and ensuring the company can cover operating expenses and pay dividends.

The pragmatic business owner understands how to plan around the tax season and use it to their advantage. They also understand that doing so requires the input of tax professionals. When coordinated correctly, tax planning brings about peace of mind that every business owner should strive for. 

What Are the Differences Between Tax Planning and Tax Services?

At first glance, tax planning and tax services might seem like the same thing. However, there are differences between these concepts. Tax planning is a strategic approach to your taxes that anticipates and responds to changing tax codes and regulations. This plan not only ensures compliance; it also positions you in an advantageous position to retain a positive cash flow in the coming years. 

Using tax planning resources typically utilizes financial professionals such as fractional CFOs who can offer financial guidance on a large scale rather than simply remaining compliant. They will be able to devise a tax strategy that meshes with your business’s overall financial objectives. 

On the other hand, tax services refer specifically to determining your tax obligations and ensuring you remain compliant. Tax services typically don’t offer tax plan consulting services that integrate with your overall financial strategy. 

Improve Your Cash Flow Through Tax Planning With Fully Accountable

Retaining positive cash flow is one of the most critical aspects of small business financial planning. As a small business owner, cash flow influences everything: your daily operations, inventory, and payroll. You name it, and cash flow will most likely affect it. It is the lifeblood of your business, and you can’t afford to ignore the potential obstacles that planning for taxes presents to its health.

At Fully Accountable, our team of fractional financial professionals has a wealth of experience managing companies in many different industries. We issue comprehensive tax planning to ensure you stay on top of your finances and enjoy a positive cash flow. We issue real-time reports and feature up-to-date accounting software that ensures you always stay on top of your cash flow and tax obligations. 

Contact us today to start implementing a proven tax planning system with Fully Accountable. 

The post Cash Flow Tax Planning: Improving Your Cash Flow Through Your Tax Planning appeared first on Fully Accountable.

These advisors ensure smooth, efficient, and profitable transitions by pairing companies with the right buyers. While their duties are similar, they serve companies of varying sizes. With an estimated $2.8 trillion generated from M&A transactions annually, the importance of having consulting services negotiate these financial deals is clear.

Next, let’s explore what M&A advisory entails and how these specialized services support businesses through complex financial transitions.

What Is an M&A Advisory Firm?

M&A advisory firms guide clients through the complex mergers and acquisitions process, which might include legal and tax implications, debt restructuring, and equity financing. However, an M&A advisory firm’s responsibilities extend deeper than simply providing guidance to companies undergoing a merger or acquisition. These firms also advise companies entering a sale, financing event, or corporate restructuring.

The M&A advisory firm acts as a middleman in business transactions between companies that either initiate the transaction or the buyer. Typical M&A candidates include companies either trying to buy or sell a portion or all of their company to a different business. While mergers and acquisitions comprise the bulk of what M&A firms handle, they can also assist companies in the following processes:

• Acquisitions advisory and market analysis.
• Capital raising and due diligence.
• Developing and reviewing financial models.
• Negotiating terms and identifying potential conflicts.

What Do M&A Advisory Firms Provide Companies?

End-to-End Support 

Outsourcing your M&A work to an M&A firm provides valuable access to insight from the pre-merger stage through the close of the transaction. A full-service team of financial professionals should coordinate and review contracts and provide post-merger integration services. 

Efficiency 

Your M&A firm should provide a cost-effective approach to the entire process. These professionals can review and analyze merger documents and create actionable strategies based on their analysis. With in-depth contract reviews and transaction analysis, you should be able to count on your M&A advisory to identify any missing documents or missing information, reducing delays and keeping the merger on schedule.

Confidentiality

Your M&A advisory firm should be able to keep your information safe and secure. They should have internal processes and procedures that secure your financial data and transactions. 

Advisory and Negotiation

One of the primary components of M&A advisory roles is their ability to navigate complex transactions by leveraging their extensive market knowledge. An M&A expert can negotiate and locate the correct buyers for companies using the following tactics: 

• Setting accurate valuations for companies.
• Leveraging the highest price for sellers.  
• Marketing the company to prospective buyers. 
• Avoiding below-market sales.
• Providing the seller with the best fit for a buyer. 
• Providing assurance that the sale gets completed according to plan while creating thorough contingency plans throughout. 
• Advising their clients on executing an exit strategy that aligns with the company’s sales objectives.

How Do M&A Advisory Firms Differ from Investment Banks?

M&A advisory firms and investment banks provide similar services to their clients. However, the primary difference between the two organizations corresponds with the size of the company each renders service to. Investment banks typically cater to clients with annual revenues exceeding $250 million. M&A advisory firms, on the other hand, are better suited toward small-to-medium-sized companies or startups with revenues between $5-$75 million. 

Investment banks and M&A advisory firms use many of the same methods to fulfill their clients’ needs. They both guide their clients through the sales or acquisition process with the mission of creating competitive buying environments that attract the best deal and the right buyer. M&A advisory is about providing advice and presenting facts about the company to improve a powerful negotiating position.

The Different Types of M&A Advisory Organizations in More Detail 

M&A advisory firms and investment banks can be divided into three different fields: business brokers, middle-market firms, and bulge-bracket investment banks. Business brokers work with smaller clients and represent them in transactions with values less than $5 million. Middle-market firms provide advice for transactions at an enterprise level between $5 million and $75 million. Bulge bracket investment banks typically work on transactions greater than $100 million.

Regulations on M&A Advisory Organizations

Most M&A advisory firms are not licensed in securities, so they are regulated to handle middle-sized transactions at most. Larger deals are handled by investment banks that are licensed in securities.

Business brokers typically base value on factors such as sales, location, and profit, whereas M&A firms focus on businesses based on their strategic potential targets, required investment analysis, valuation of intellectual assets, and potential future growth. M&A firms also handle deals that are too large for business brokers. 

M&A advisory firms are also subject to federal regulations. In 2016, the SEC relaxed FINRA rules that govern M&A firms and their activities. M&A firms are not required to be licensed broker-dealers whereas investment banks are. 

How Do You Choose an M&A Advisory Firm?

While business brokers, M&A advisory firms, and investment banks perform many of the same duties, companies must consider which size organization best fits their needs. Additionally, companies should consider precisely what financial services they require. 

If companies are looking for financial consulting services or tax planning, they should consider a fractional CFO or an outsourced accounting firm. Sometimes, as in the case of Fully Accountable, M&A advisory firms can guide your company to the services you require most. 

Your M&A advisory firm should schedule an interview with you to determine the most appropriate course of action. The interview should also specify payment structures, the firm’s past successes, and its investing approach. Clarifying the firm’s capabilities, payment structure, reputation with past clients, and investment approach will give you all the information you need to decide whether they are the right fit.  

Consider Fully Accountable for Your M&A Advisory Needs

The full-service team of financial professionals at Fully Accountable is here for any small-to-medium-sized business that needs merger and acquisition services. Our fractional CFOs ensure the proper business fit, whether you’re selling your business or implementing a corporate restructuring. 

Our commitment to providing a personalized approach expedites the M&A process and ensures an efficient transition. This personalized approach ensures you adhere to all legal obligations and simplifies any post-merger challenges. We make the most of your negotiations and attract the right candidates for your business sale. 

Contact us today to set up a free consultation and ensure you get the most out of the mergers and acquisitions transaction process. 

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Structuring your company’s accounting operations is always a challenge, no matter your size or success level. One of the questions companies often find themselves asking is about the differences between financial controllers and accountants.

When it comes to controller vs accountant, the truth is that there isn’t a world of difference between the two. Financial controllers and accountants are closely related. The main difference between the two roles is the level of oversight controllers provide to their respective organizations. This article discusses the differences between an accountant and a controller. Though the two roles have differences, they are both integral parts of any accounting team.

Continue reading to learn about the differences between an accountant and a controller.

At Fully Accountable, we understand your business has unique accounting needs. Our full-service digital accounting firm — equipped with digital accountants, controllers, and chief financial officers — can formulate a comprehensive accounting plan that suits your industry needs.

Accountant Vs. Controller

When considering controller vs accountant, it’s important to understand that while both handle financial data, controllers take on a more strategic role overseeing accounting operations. Whether you hire a full-time accountant or controller or you use outsourced accounting services, accountants and controllers mostly offer the same services. However, a controller is a more senior controller position responsible for managing the firm’s accountant-related activities.

Junior accountants rarely hold controller positions. The majority of controllers also have at least several years of experience and various professional certifications. Additionally, most controllers start as certified public accountants. They then work their way up in corporate settings before earning the trust necessary to fulfill controller duties.

To cut it short, the difference between accountant and controller lies in the scope of their responsibilities. Accountants focus on financial reporting and compliance, while controllers manage the entire accounting framework.

What Is an Accountant? 

On the whole, non-controller accountants perform simpler accounting tasks than controllers. Some of these responsibilities include tax auditing, cost accounting, and internal reports. 

Every certified public accountant also understands how to complete bookkeeping tasks and oversees other bookkeepers’ optimal performance. They work to prevent fraud and maintain the company’s financial statements’ accuracy for co-workers, investors, creditors, and regulators.

What Is a Controller?

A controller in accounting acts as the chief accounting officer, overseeing financial management, internal controls, and reporting processes for a business. The role of a controller’s role involves handling the entire accounting operations for organizations. They are essentially the chief accounting officers for organizations, and they play critical roles in organizing and executing accounting actions. For smaller companies, controllers set up an effective accounting infrastructure. For larger companies, controllers act as an overseer. Regardless of the company’s size, you need a controller for your business when the accounting becomes too much to handle for you or your accountants.

A controller does this at a company, but to do their job, they must also have some financial data analysis skills. Controllers do not need to fulfill as many forecasting responsibilities as CFOs. However, they still have to fulfill some requirements, particularly in tax management. Chief financial officers can also call on them to offer their perspectives on investments, creditor relationships, or corporate governance.

Companies might have a controller hierarchy, wherein a head controller has two or three controllers underneath them. Assistant controllers are less experienced and spend more time on day-to-day bookkeeping responsibilities. These responsibilities include data collection and regulatory or statutory reporting.

Key Differences in Education and Skills 

Anybody with a background in finance, statistics, mathematics, or economics and a broad understanding of generally accepted accounting principles (GAAP) can complete bookkeeping duties. 

However, for more senior-level accountant jobs, candidates must have their certified public accountant license. In many cases, they must also be a certified management accountant (CMA), a chartered financial analyst (CFA), or hold different accounting certifications. For senior-level positions, an average of three to six years of experience is preferred. Tax accountants or junior auditors might only require one to three years of experience.

Financial Expertise

Experience is the best teacher, and controllers typically have more of it than accountants. While both positions have a foundational knowledge of accounting principles, controllers have seen the practical implications of that knowledge and use it to make profitable decisions for organizations. Accountants should have the same knowledge as controllers, but they simply haven’t put it to use yet. 

Generalist or Expert  

Accountants have the opportunity to hone their skills and specialize in certain aspects of accounting. Controllers have to be experts in a wide range of accounting principles. As a controller, you have to analyze the accounting functions of the whole organization. Whereas accountants can focus on one process, controllers ensure the entire accounting team’s success.

Data Vs. Information 

With controllers’ backgrounds in accounting and business, they can provide input into forecasting and financial strategy. Accountants haven’t developed the experience to analyze financial data yet. They still focus on the accuracy, compliance, and reporting of that financial data. 

Controllers interpret the data and build it into something more useful that provides guidance and facilitates tangible benefits. The controller may use the data to develop and maintain a financial forecast. They will also incorporate cash flow projections and sustainable financial growth models. 

If the data points to inefficiencies, controllers can establish internal controls to improve the financial model or change the existing model. 

Bookkeeping Vs. Accounting Vs. Advisory 

An easier way to think about the accounting hierarchy is to separate the roles into three categories: bookkeeping, accounting, and advisory roles. 

Bookkeeping: 

Bookkeepers enter data into the company’s books and keep track of financial statements up to date. They track all income and expenses, pay bills, respond to outstanding invoices, and track payroll, as well as ensure tax compliance. 

Accountant:

In smaller-to-medium-sized businesses, the accountant might perform some of the bookkeeping responsibilities. However, in larger companies, accountants perform more in-depth accounting procedures and have a higher experience level. Accountants typically oversee bookkeepers, perform billing, conduct larger ledger entries, review accounts payable activity, and operate payroll smoothly. 

Controller:

So, what does an accounting controller do? Controllers ensure accurate financial reporting, manage tax compliance, and implement financial strategies for sustainable growth. Controllers oversee the accounting operations of the entire organization. They manage the accounting functions, facilitate month-end close processes, and perform financial statements reporting functions essential to the business. 

The controller is the first level of advisory within a company’s accounting structure. However, above them, the chief financial officers provide an even larger advisory role. 

CFO:

What do CFOs do? The chief financial officers (CFO) project the long-term financial picture for an organization. They help the company thrive based on their analysis and oversee the controller fulfilling their responsibilities. 

CFOs also oversee the business’s investment and capital procurement process. They analyze the company’s debt and equity ratio and take stock of the strengths and weaknesses of the company. CFOs have to understand the company’s financial positioning within the broader context of their industry. 

Do You Need an Accountant or a Controller?

A small business may only need an accountant, as financial controller salaries can be expensive. For example, while the average salary for an accountant is around $73,000, the median annual salary for a controller is $130,000.

Larger businesses, such as enterprise-level companies, don’t need one or the other; they need both. More specifically, they need an accounting department full of accounting professionals who can parse through loads of financial information to develop financial documents, such as cash flow statements, which inform financial leadership and improve the financial health of the company. They need a team of people focused on bringing sustainable financial results and implementing a solid accounting infrastructure.

Hiring an accounting team brings credibility to your numbers. Controllers take the credibility and help you work with investors or run meetings with the board of directors. A full-service accounting team does more than simple bookkeeping. It implements and executes a financial strategy that brings continued success to your business.

Fully Accountable — Outsourced Accountant, Controller, and CFO Services

Understanding the difference between controller and accounting manager is essential. Accounting managers focus on daily financial tasks, while controllers oversee financial planning and policy implementation. The difference between an accountant and a controller is the level of oversight controllers provide organizations compared to accountants. Controllers ensure that an organization’s accounting procedures run smoothly. Accountants focus more specifically on one aspect of the business’s financial operations, ensuring proper reporting and compliance.

At Fully Accountable, our full-service outsourced accounting firm is here to fill all your financial needs. Need a fractional CFO? A Strategic CFO? Or just a controller or bookkeeper? Regardless, our accountants provide real-time results. Implement the accounting infrastructure you need.

Sustain financial performance and predict future outcomes. Our accountants not only ensure compliance by overseeing your accounting infrastructure. We also provide future forecasting and financial strategy based on your company’s organizational needs.

Contact us today to learn more about controller and CFO services.

Frequently Asked Questions

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