What is a Controller?

A controller is the head of an accounting department in the company and is in charge of all those within the accounting department, such as accounts payable clerks, accounts receivable clerks or payroll. Although these areas may be split into different departments among accounting, the controller is responsible for overseeing financial statements, general ledger, budgeting and tax compliance.

Depending on the company, the role of the controller varies. At a smaller company, the controller may be the sole accountant and have a clerk or two underneath them. They would report directly to the President and have a hand in almost every accounting function. At a larger company, the controller would report to the CFO (chief financial officer). They would have a team of accountants underneath them, who then supervise clerks and roles beneath them. The controller at a larger company would have a more high level function of the accounting, instead of having a hand in each and every department.

How Do They Affect Accounts Receivable?

The controller plays a huge role in creating a policy that will ultimately affect how much cash flow is coming into the business. The controller is expected to create, manage and maintain a credit and collections policy. The collections policy determines how many days a collections representative gives before sending out additional collections letters, past due notices and notices of legal action. By choosing the right span of time, this can affect how quickly a customer will pay their invoice. A controller can also have a big impact on the credit policy, which will determine how many days a customer is given to pay. Additionally, it will determine what requirements a customer must have in order to qualify for credit terms. Based on these requirements, the company can end up with customers that are reliable and trustworthy or ones that continually do not pay on time.

The controller also affects accounts receivable by reporting on and tracking business intelligence data, such as average days to pay, collection representative activities and common invoice dispute reason codes. This gives the controller insight into how well, or not so well, things are going and how they can use that to open up more cash flow. For example, if they see that invoice disputes are constantly coming in for missing purchase orders, the controller can create a policy for ensuring that purchase orders are always attached to the original invoice.