Fractional Controller vs Fractional CFO: What's the Difference?

July 3, 2023

When it comes to getting a firm grip on business finances, a Fractional CFO and Fractional Controller both fit the bill. These roles support companies that need financial guidance without the commitment of a full-time hire. However, each one has a different approach and impact on a company's financial health. 

What Is a Fractional Controller?

A Fractional Controller manages financial reporting and compliance on a part-time or project basis. They're generally brought on board to oversee accounting processes and identify cash flow risks to help keep profit margins moving in the right direction. Part-time Controllers are also used for their financial acumen in automating internal controls for safety and compliance while reducing labour costs. 

What Is a Fractional CFO?

A Fractional CFO provides companywide oversight and guidance on finance operations. Companies hire Fractional CFOs part-time or for specific projects, like mergers and acquisitions or financial audits. Fractional CFO services are also strongly sought after during the startup phase to get help with financial projections and potential investor relations for funding rounds. 

Fractional Controller vs Fractional CFO: Key Differences

Figuring out the financial impact of a Fractional Controller vs Fractional CFO isn't just a matter of semantics. There are key differences between the qualifications, roles, and responsibilities.

Qualifications

Fractional CFOs typically hold an active CPA (Certified Public Accountant) license or CMA (Certified Management Accountant) certification and a master's degree in accounting, finance, or business. In most cases, a Fractional CFO will have around 8-10 years of experience as a chief financial officer and in public accounting. This includes experience in managing and training finance teams, implementing internal controls, and overseeing external audits.

Fractional Controllers will have a bachelor's or master's degree in finance, accounting, or business. They often have a CPA license or CMA certification, but these designations aren't required. Many financial Controllers have around 5-7 years of experience as auditors or accountants, followed by several years as an assistant Controller. This includes experience in financial reporting, compliance, budgets, and forecasts.  

Roles

The Fractional Controller role typically focuses on the day-to-day financial operations. They have ownership over the financial process and produce reports to support strategic decision-making. On the other hand, a Fractional CFO functions as a strategist, overseeing big-picture financial goals and capital structure. 

Smaller operations can sometimes blur the lines between these roles, but there is a specific structure for organizational hierarchy. Fractional CFOs are part of the executive team and typically report to the CEO or board of directors. Fractional Controllers are part of senior management and report to either the CFO or another senior executive.

Responsibilities

Fractional Controllers are essentially responsible for producing financial statements. They account for every incoming and outgoing transaction to ensure accounting functions align with financial goals and regulatory compliance standards.

Fractional Controller Responsibilities: 

  • Manage accounts payable and receivable
  • Maintain chart of accounts
  • Report financial operating metrics 
  • Develop and supervise internal controls 
  • Monitor debts and compliance

Fractional CFOs are responsible for analyzing financial reports and turning this data into viable strategies for long-term growth. They cover every financial aspect of a company portfolio, from initial projections to annual profits.

Fractional CFO Responsibilities:

  • Develop financial forecasts and budgets
  • Provide cash flow projections
  • Manage investment activities
  • Negotiate mergers and acquisitions
  • Oversee capital structure and funding

When to Hire a Fractional Controller vs Fractional CFO?

Hiring a Fractional CFO vs Controller comes down to filling financial gaps. If the main concern is accurate financial reporting and day-to-day operations, Fractional Controller services will likely be the best choice. For companies that need high-level insight and long-term financial strategies, Fractional CFO services may be more suitable.

Still not sure which role is the right fit for your financial needs? Book a free consultation to get help with hiring Fractional Controllers and Fractional CFOs. 

Alyssa Huizenga
Director, Business Development
[email protected]

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