A FINANCIAL CONTROLLER service – a new way to support management
Companies have experienced positive changes in recent years in the area of financial reporting, which has become voluntary rather than mandatory. Changes in laws governing accounting and auditing activities have provided companies with guidance on the shape, form, and content of financial reporting, enabling to use the financial information to make more effective management decisions to reduce administrative burdens.
More specifically, the requirement for external reporting has decreased since 2017 as result of changes in the accounting law. The amendment to the auditing law has provided higher thresholds for financial statements and audits as of 1 January 2016, which has reduced the volume of assurance services. On one hand, this keeps more restricted information out of the public view, while on the other hand, it allows companies to use the freed-up resources in their own interests. The reduction of administrative burdens and the automation of accounting processes could be used wisely by companies for more efficiently managing their activities as well as intra-corporate financial processes. At this point, the financial controller's involvement would enable the management of the company to more effectively devote itself to the development and management of its business, by obtaining reliable and objective financial information for management decisions.
For companies today, it makes sense to seek legal or tax advice as the situation requires. A financial controller service could provide the same kind of natural support. On one hand, through accurate and timely analyses and reports, proper financial procedures and reporting, as well as more effective coordination of internal controls, providing management with high-quality background information for decision making. On the other hand, through effective internal financial accounting, such a service will provide direct financial savings by limiting the need for assurance services as well as saving time resources, in addition to streamlining financial and business procedures.
The financial controller service is a new way of helping management, as well as the financial team and business development. The role and work volume of the financial controller depends on the company's needs and can vary from monthly updates to an annual overview. The new approach is to be part of the company's team, as needed, and not just as an adviser. The financial controller service includes the experience of working in different companies, as such experience can only be beneficial in improving various financial functions and internal control systems where processes are given a fresh look.
For a long time, finance has no longer been just about accounting. Thanks to the ever-increasing automation of accounting processes, the control function has become more important, a service that is now available exactly in proportion to the needs of management or the financial department. Today, many companies require this as a full-time role, but there are even more firms where the financial control function could be provided on an as-needed basis. A financial controller's services may include:
▪ preparation and review of monthly/ quarterly management accounts;
▪ continuous reporting on key ratios and performance analysis;
▪ implementation/ review of financial processes and procedures;
▪ forecasting and budgeting;
▪ KPI (key performance indicators) reporting
▪ FLUX (fluctuation) analysis
▪ ensure that group regulations are implemented and maintained. Preparation of group reports;
▪ financial control and reporting in line with group methodology, timeline and local regulations;
▪ audit preparation (including preparation of annual statutory financial statement) and working with internal and external auditors;
▪map and test internal controls, ensuring successful execution of roles and responsibilities;
▪ support and guide management in regarding to business and finance issues;
▪ transfer price control in accordance with group policies.
If a company doesn't need a full-time financial controller, and only some financial procedures are required, a financial controller service will save members of the company's financial department and management team both time and energy while bringing value to beneficiaries through cost savings and more efficient business activities.
Kersti Leetma, Nordic Finance OÜ