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More Deliverables To Expect From Your Finance & Accounting Team

Updated: Apr 8, 2023

In my last article, The 5 Key Deliverables To Expect From Your Finance & Accounting Team, I outlined the items you should make an immediate priority. They were:

1. GAAP Compliant Financial Statements

2. Management’s Discussion & Analysis

3. Bank Covenant Reporting

4. 13-Week Cash Flow Forecast

5. Three-Statement Financial Forecast

Beyond these deliverables, which at a minimum require basic, accrual-method bookkeeping, there are numerous other areas of responsibility and deliverables your F&A team should ideally be able to oversee and provide. Some of these are critical to producing the five key deliverables, and/or they are of absolute necessity in running your business. Others don’t necessarily carry the same urgency, but are obviously important. So, here we go …

1. Treasury Management

The Treasury function oversees the inflow, management, and outflow of cash. You’ve been doing it since you got your business up and running – you just didn’t call it “treasury”. And perhaps you’re still overseeing this yourself if your business is relatively small. Treasury covers everything from your invoicing and accounts receivable collections, to your cash accounts and interest income opportunities, to your accounts payable. As a function, there isn’t much else that’s as important! As you grow, you’ll want to entrust oversight to a competent F&A professional.

2. Payroll

Smaller companies tend to roll payroll, administrative, and other HR functions under the F&A team. Larger companies segregate HR into its own department and payroll will often fall under the control of HR. In addition, Payroll can be almost entirely outsourced, partially outsourced, or processed in-house. No matter how you structure things, ensure someone well-versed in payroll regulations and processing oversees this function internally. Next to managing cash, almost nothing is as important as paying your employees accurately and on time.

3. ERP System Oversight

Someone in your organization needs to be the master of the ERP system – whether you use QuickBooks, a larger package like Sage Intacct or Oracle NetSuite, or industry-specific software. The old adage, “garbage in, garbage out” seems apropos here. Ideally, your Controller, Accounting Manager, or Senior Bookkeeper is this person; however, depending on complexity and resources, it might also be an IT professional.

4. General Ledger / Chart of Accounts Ownership

This can be a corollary to ERP System Oversight, but should always fall within the F&A team. It starts with creation and maintenance of an adequate, efficient chart of accounts. Then, your lead accountant (ideally a qualified Controller) should have control over the general ledger, which encompasses oversight for the recording of all sub-ledger and general journal entries, as well as ensuring general ledger account reconciliations.

5. Ad Hoc Financial Reporting & Analysis

Beyond the five key deliverables, there will be more analysis to accomplish in order to support management decision-making. You will want to facilitate a harmonization of your F&A team with the key managers in your business and develop a cadence for talking about issues early and often. The F&A team can work with specific managers to dig behind the numbers, uncover operational issues, and provide the clarity necessary for change and improvement.

6. KPI Dashboard Development/Maintenance

Similar to Ad Hoc Financial Reporting & Analysis above, weekly KPI (Key Performance Indicator) dashboards need to be high on your priority list if not currently utilized in your business. KPI dashboards provide both leading and trailing indicators of performance; include both general and industry-specific types; and are often in the form of ratios or other metrics (for example: current ratio, asset utilization, sales per square foot, variable cost per unit, etc.). They can be as simple as a very basic spreadsheet with numbers and ratios, to a more sophisticated report layout including charts and graphs.

7. Annual Budget Creation

If you’ve developed a financial forecast as part of your five key deliverables, the annual budget falls hand-in-hand with your calendar, one-year forecast. The budget is static, and results will be measured against it throughout the year to determine reasons for variances. Budgets require input from multiple managers for accuracy and accountability, and they can be time-consuming to produce for all involved. However, without a budget, organizations (like people) will lack discipline in their focus, spending, and expense management.

8. Fixed Asset Reporting

Surprisingly few F&A teams in the lower middle market actually do fixed asset reporting well. You need to clearly delineate between capital expenditures for fixed assets, and true expenses that go straight to the P&L. Simple rules can be put in place based on size of the purchase, and adequate controls should govern who has authority to make and approve fixed asset purchases. In addition, the F&A team should have a process/method for timely recording of depreciation – ideally within your ERP software, or manually within Excel spreadsheets.

9. SG&A Expense Reduction

Expense reduction and improved efficiency are a mindset, and can be infused into the culture of your business by always making it part of any agenda. Just as good purchasing teams seek to improve gross margins through better pricing and terms, buying in bulk, etc., good F&A teams understand that, as an overhead department, reducing SG&A is how they “give back” to the business. Annual insurance renewals, miscellaneous office expenses, and service provider fees are examples of good places to start in the hunt for reducing expenses.

10. Financial Statement Audit

As your business grows and you seek outside capital from equity investors or lenders, or, if you decide to exit your business, you will most likely be required to present audited financial statements. Successfully completing an audit and producing audited financials is no small feat – ultimately, it means that your financials statements are materially correct in the opinion of your chosen CPA firm … which in turn means that you have followed GAAP and recorded and presented historical data correctly. Your F&A team should be competent enough to ensure a successful audit.

11. Risk Management

Risk management can cover a number of areas, depending on your business and industry – from safety to trading (for example, Oil & Gas companies have entire departments devoted to safety, as well as to daily hedging of oil and gas prices). For most companies, however, the basic area of risk management is business insurance, and potentially bonding if in the construction or service industries. I have found that in most lower middle-market businesses, it is the F&A team that is given responsibility for procuring and maintaining adequate business insurance and bonding capabilities.

12. Federal, State and Local Tax Reporting

For many lower middle-market businesses, federal and state tax liability will revert back to ownership, as most private companies are pass-through entities organized as LLCs, S-corps, or LLPs. F&A teams should ensure coordination of federal return preparation with ownership and their designated CPA firm. State and local tax reporting will require more direct, hands-on work. The F&A team should understand all monthly, quarterly and annual reporting deadlines and complete all required filings. These are sometimes easy to miss, so attention to deadlines is crucial as penalties are often steep!

13. M&A Activities

If you are “acquisitive” or pursuing a “buy-and-build” strategy, you’ll need support in performing valuations of your targets, structuring deals, completing due diligence, recording the transaction, and integrating the merged entity. Larger companies have entire departments devoted to M&A. Lower middle-market businesses will generally rely on the combination of an experienced CFO or Controller from the F&A team working with the CEO, other managers, and third-party advisors including attorneys and CPAs. Whatever your resources, the F&A team will have to be involved at some level.

14. Human Resources & IT

I put these two last because HR and IT generally require their own departments as your business grows. In the beginning, you may assign your Controller or CFO to oversee these functions, however, HR and IT are specialty areas that demand their own expertise, ongoing training, and support. If you do assign HR and IT to your F&A team, ensure the F&A leader is well equipped to oversee these functions by partnering with third-party service providers for things like employee handbook development, benefits administration, payroll support, server hosting, technical support and troubleshooting, etc.

In conclusion, in addition to the five key deliverables I’ve previously written about, there are many things to expect from your Finance & Accounting team, as listed above. By putting it all together, you now have a fairly comprehensive picture for what to expect and what to ask about when it comes to your F&A team. This could form the basis for an annual review with your CFO or Controller, or could help you formulate a plan for hiring appropriately. Remember that first and foremost, the F&A function should support the business with timely, mission-critical financial data – everything else follows. And, the larger your business, the larger the volume of work to accomplish and the more F&A resources you will need. Plan accordingly!


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