In the early stages of your startup, hiring an internal accounting team is not your highest priority. When it’s just you, other founders, and a few vendors an outsourced bookkeeper will help ensure you remain tax compliant, freeing you up to focus on growth. But, as your business progresses, the demands of your finance functions become more complex. You’ll require a more experienced, dedicated team to handle the intricacies of financial statements, due diligence for funding, audits, budgeting, and projection work. The right outsourced accounting team can support you through this essential early growth stage and eventually help you decide when it’s time to hire an internal controller.
An outsourced controller can support you through the early stages of your startup
Getting a tech startup off the ground requires a finance team with different skill sets. By choosing the right outsourced accountants, like us here at WA, you get the benefit of a staff accountant, a payroll expert, a dedicated bookkeeper, and experienced accountants who can fulfill the duties of a company controller.
In the very early stages of your startup, your outsourced controller will:
- Oversee the work of the bookkeepers and staff accountants
- Review finances and prepare financial statements for management
- Assist with the filing of compliance documents and special reports
- Work directly with your tax accountant to prepare for your annual tax return. (If you don’t have a tax accountant, we can refer you to the excellent professionals we work with on a regular basis.)
- Ensure all your finance functions are seamless, efficient, and as accurate as possible
In these early days, you may be communicating with your outsourced accountant weekly or maybe monthly. As your startup takes off and your needs elevate, so too does the role of your outsourced controller. You’ll begin working with them on a more frequent basis as they oversee your accounts receivable and accounts payable. They’ll also be an invaluable resource when it comes time to hire a CFO.
After a round of funding, your CFO becomes the financial voice of your company
When your company takes in investor funding, you’ll have new requirements and responsibilities with your accounting. Your board of directors will likely require you to hire a CFO to meet these new needs. Some of the duties of a CFO are:
- Overseeing accounts for compliance and budgetary purposes
- Compiling cash projections, preparing forecasting and budgeting reports for your investors and board of directors
- Securing additional funds through debt instruments as well as preparing for future rounds of equity funding
- Building and maintaining a clear financial vision for your company
Your outsourced controller will support your CFO in fulfilling these duties. For example, your investors will want to see certain metrics included in your CFO’s reports, like MRR and ARR, which your controller can help calculate.
Your controller will also coordinate and lead the annual audit process as well as due diligence audits when considering institutional debt. They will ensure all deadlines are met, your CFO and founders remain fully informed, and any required adjustments are made.
An internal controller can meet the new demands of your growing company
As you near and complete your Series B round of funding, a good outsourced accounting team will begin discussing the next steps with you. Because we’re working with your finances every day, we know when it becomes time to elevate your accounting functions. During your scaling phase, you’ll require a controller who is solely dedicated to you and your company. An internal controller will handle:
- Overseeing day to day accounting
- Cash management
- Preparation of financial statements and support
- Support for financial projections and budgeting
- Bank compliance including an annual audit
- Tax compliance for both federal and state obligations
At WA, our services can grow with you, from light bookkeeping in your startup days through full accounting department functions as you grow. We believe in trust and efficiency, so we’re always communicating with you and helping you decide what’s best for your business. When it comes time to hire an internal controller, we’ll assist you through the process to make everything as seamless as possible. To get the best growth and success for your business, find out more about how we work.