Financial Controller Job Description for Professional Services Startups: When to Hire and Key Responsibilities

When to Hire a Financial Controller in a Professional Services Startup

For most professional services founders, the finance function starts as a collection of spreadsheets, a QuickBooks or Xero subscription, and a nagging feeling that the numbers are not telling the whole story. Invoices go out and cash comes in, but true project profitability remains a mystery. This setup works for a while, but as the firm grows, the cracks begin to show. Financial reporting becomes a reactive, time-consuming scramble instead of a strategic asset. Our hub on building your finance team provides guidance on sequencing these hires.

This isn't a sign of failure; it’s a predictable inflection point. It signals the need for the first dedicated, senior finance hire: the Financial Controller. This role is less about simple bookkeeping and more about building the financial infrastructure required to scale a services business predictably and safely.

When Do You Really Need a Controller? (Hint: It Is Not About Revenue)

Founders often ask if they need a controller at a specific revenue milestone. While spreadsheet-based systems typically break at the $2M-$5M revenue mark for professional services firms, revenue is a lagging indicator of the real issue: complexity. The practical consequence tends to be that financial control is lost long before a revenue target is hit.

The more accurate trigger for hiring is operational complexity. The need for a controller is often triggered by managing more than five to seven active projects of varying types simultaneously. When you have a mix of retainers, fixed-fee projects, and time-and-materials contracts, tracking true performance in a spreadsheet becomes nearly impossible. This is the point where you should consider your options, including a fractional controller to manage costs before committing to a full-time role.

External catalysts are also critical timing indicators. If you have a major financial event on the horizon, you need to act preemptively. A controller should be hired six to nine months before a planned fundraising round or a company's first financial audit. Waiting until the event is imminent creates a frantic, high-stakes cleanup project that drains founder focus and introduces unnecessary risk.

The Core Controller Responsibilities in Professional Services Startups

A great controller for a professional services startup focuses on three strategic outcomes. They are hired to transform financial chaos into a predictable system by moving the company from ambiguous earnings to audit-ready revenue, from messy projects to predictable margins, and from due diligence fire drills to an 'always-on' state of readiness. These are the fundamental controller responsibilities in professional services startups.

1. From Ambiguous Earnings to Audit-Ready Revenue

The most urgent task for a new controller is ensuring correct revenue recognition, which is essential for trusting your own profit and loss statement and passing external scrutiny. This means moving beyond cash-in-the-door accounting to a proper accrual-based system compliant with official standards. Proper accrual accounting and revenue recognition for agencies are non-negotiable for scaling.

For US companies, this process is governed by ASC 606, the revenue recognition standard under US GAAP. In the UK, the equivalent is IFRS 15, with FRS 102 also being highly relevant for many businesses. A controller implements the systems to comply with these rules, solving the pain of misapplied revenue recognition that can overstate earnings and undermine investor trust.

Consider a concrete example: your agency signs a 12-month, $120k retainer paid quarterly. A cash-basis approach might show a $30k revenue spike every three months, creating a volatile and inaccurate picture of performance. Under accrual accounting, the controller ensures you recognize exactly $10k in revenue each month, reflecting the consistent delivery of services. This provides the true, smooth performance view that investors and auditors require.

2. From Messy Projects to Predictable Margins

Is a project actually profitable? For many growing agencies and consulting firms, the answer is a gut feeling, not a data point. A controller’s second mandate is to solve this by building a system that measures and reports on project-level profitability, directly addressing the pain of not knowing your true margins.

This involves implementing proper work-in-progress accounting for startups. Work-in-progress (WIP) represents the value of billable work performed but not yet invoiced. Without tracking it, you have a significant blind spot in your financials. The controller establishes a process to connect time-tracking data, direct expenses, and allocated overhead to each project in your accounting software, whether it is QuickBooks or Xero. You can see how this profitability reporting appears in tools like Xero Projects.

This creates a feedback loop for the entire business. When you can see the precise margin on every project, you can make smarter decisions about quoting new work, allocating resources, and managing scope creep. It transforms the finance function from a historical record-keeper into a strategic partner that helps forecast cash needs and drive profitability. This visibility is essential for managing everything from team capacity to partner profit distribution in more mature firms.

3. From Due Diligence Fire Drills to 'Always-On' Readiness

The third mandate is to eliminate the panic-inducing fire drill that occurs when an investor, lender, or auditor requests financial information. This scramble drains founder time and risks delays or compliance issues. The controller’s job is to build a finance function that is perpetually ready for scrutiny, forming the core of your audit preparation checklist for startups.

This process starts by establishing a disciplined and predictable monthly close. A key performance indicator for a controller is completing the monthly financial close by the 10th business day of the following month. This rhythm ensures all transactions are reconciled, accruals are booked, and financial statements are accurate on a consistent schedule. It institutionalizes financial discipline.

An 'always-on' ready finance function should be able to produce the last 12 months of GAAP-compliant financials within 24 hours for an investor request. This capability signals a high level of operational maturity and builds immense trust with external stakeholders. It also provides leadership with reliable, timely data for decision-making.

A Blueprint for Controller Responsibilities in Consulting Firms

Now that you understand the strategic impact, you can write a job description that attracts the right candidates. Instead of a long list of tasks, frame the role around the outcomes you need. Here is a blueprint to guide your thinking on controller responsibilities in consulting firms and other services businesses.

Mission: To build and lead a disciplined financial function that provides accurate, timely insights on project profitability and revenue, ensuring the company is always prepared for its next stage of growth, whether that is an audit or a funding round.

Core Responsibilities (Outcomes-Based):

• Own Revenue Integrity: Implement and manage revenue recognition policies compliant with US GAAP (ASC 606) for US operations or IFRS 15/FRS 102 for UK operations.
• Drive Project Profitability: Develop and maintain reporting systems to track project-level margins, including work-in-progress (WIP) and cost allocation.
• Ensure Timely Reporting: Manage the monthly close process to deliver a complete and accurate financial package by the 10th business day.
• Maintain Constant Readiness: Ensure the company can produce audit-ready financials for any 12-month period on short notice for due diligence.
• Scale Financial Operations: Lead the selection and migration from QuickBooks or Xero and spreadsheets to a more scalable PSA or ERP system as needed.

Qualifications:

• A CPA license is a common requirement for a Financial Controller in the US. In the UK, an ACCA or CIMA qualification is the equivalent.
• Demonstrated experience in a professional services environment (e.g., agency, consultancy, B2B services).
• Hands-on experience with revenue recognition standards and project-based accounting.

Practical Takeaways for Hiring Your First Controller

The decision to hire a financial controller is a crucial step in scaling a professional services startup. It is not a question of revenue, but of complexity. Once you are juggling more than five to seven projects of different types, the risk of financial mismanagement grows rapidly.

Remember to hire proactively, ideally six to nine months before a major audit or fundraising event, to give them time to build the necessary systems. The right controller does more than just close the books; they provide the financial visibility needed to quote projects profitably, manage cash flow effectively, and pass investor scrutiny with confidence. This role is the foundation of a scalable finance team structure for professional services and the key to turning financial data into a competitive advantage. You can learn more at our hub on building your finance team.

Frequently Asked Questions

Q: What is the main difference between a bookkeeper and a Financial Controller?

A: A bookkeeper primarily records daily financial transactions, ensuring data is accurate and up-to-date. A Financial Controller uses that data to build financial systems, create reports, ensure compliance with accounting standards like ASC 606, and provide strategic insights on profitability and readiness for audits or fundraising.

Q: Can I use a fractional controller instead of a full-time hire?

A: Yes, a fractional controller is an excellent option for startups that need senior financial expertise but are not ready for a full-time salary commitment. They can establish the core systems for revenue recognition and project profitability, setting the stage for a future full-time hire as complexity increases.

Q: Why is work-in-progress (WIP) accounting so important for agencies?

A: WIP accounting for startups in professional services is critical because it tracks the value of work that has been delivered but not yet billed. Without it, you have an incomplete view of your earned revenue and project costs, making it impossible to know your true profitability on any given project.