The Top Ten Things that Will Get Controllers Fired!

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10.  Controller does not pursue self-improvement by attending classes, reading periodicals in their field.

9.    Doesn’t care anything about learning the Industry they are working in.

8.    Lacks the vision to implement improvements in accounting systems, processes and procedures.

7.    Fails to develop or mentor staff and often feels threatened by subordinates.

6.    Arrogant

5.    Fails to grasp the importance of Fast Closes and producing Financial Statements on a timely basis as defined by management.

4.   Always puts personal needs ahead of company’s needs.

3.   Does not ask questions or seek support from their system’s software vendor and outside accounting firm.

2.   Is seen as ‘in over their head’.

And NUMBER ONE REASON CONTROLLERS GET FIRED:  The CEO, CFO or Ownership of the company does not trust and/or respect them. (The reason is immaterial).


The Real Road to a FAST CLOSE………….really!

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There are books on the Fast Close.  There are seminars and webinars.  We come home with great pointers and ideas.  Now we are going to have internal financials produced on the fifth day after Month End.  But somehow we just never get there.  Isn’t it all just so frustrating?  If you are the Controller you are most likely on the front lines of the Month End Close.  Many controllers working for privately held companies end up closing various sets of books, sometimes including  truly diversified business types.  And, if inventory is involved, that adds another layer of complexity.  Here’s what I have discovered and learned observing CFO’s I’ve been associated with:

  • Consider issuing a set of Preliminary Financial Statements with the following caveats:
    • These statements do not reflect the following: (Example)
      • Depreciation Expense
      • Insurance Expense
      • Other Allocations
  • Review all your POST CLOSING Journal Entries
    • Can your software generate automated entries for the Month triggered by the Closing Process?
    • Are you making entries or reconciliations at month end that could be moved to mid-month as long as there’s 30 days between reconciliations?
  • Can you create a ‘CLOSING’ Team, even if it’s just you and one other person.
  • Do you have a MONTH END CLOSING set of Checklists that can be ticked off as processes are completed?

Start ‘GRADING’ your Closing team as a whole after the  FINAL Financial Statements for the period have been issued.

Then go through the same processes shown above next month and every month.  Continue to look for the ‘constraints’ that slow down the closing process.  Then do something about them!  And, as always, consult your outside Accounting Firm to be sure you are on the right track.


So you are at Month End closing and the Cost of Goods Sold seems really distorted.  As a result, your Gross Margins are badly understated versus budget and prior year.  You go to research and find that someone on the Accounting Staff has made an entry debiting COGS and crediting an inventory account on the balance sheet.  Your system will give you the name of the person making the entry based on his login credentials.  You have a conversation with the accountant and he has no recollection of why he made it, and there is no documentation.  Anybody in a manufacturing environment has probably been through this scenario at least once or twice.  I know I have.  Manual entries to Cost of Goods Sold can wreak havoc as they can in other areas like Prepaid Asset accounts, etc.

I recently ran into a problem like this with a client.  The Staff Accountant responsible for moving certain things off the balance sheet into COGS (this had to do with Work in Process) was constantly making Journal Entries….and then turning right around and reversing them.  You could see a pattern occuring in the G/L Account Detail.  And why was this happening……………..because the accounting department could never get in agreement with the Controller about how much the month end entry should be.  Sometimes the entry was backwards, or sometimes the entry was to the incorrect entity.

I wanted to scream STOP!  But first, Full Disclosure.  I used to be guilty of this.  Just opening up the G/L JE screen and keying in a JE I hoped would fixed the problem.  Then reversing it and finally, taking myself down the black hole of JE confusion.  At that point, I would have to print out the detail and try to work myself back to ‘zero’ impact.

What is wrong with this picture?  As Controller, you need to stop the wave of manual JE’s entered by your staff and make sure that there is documentation for it.  If you set up twelve recurring monthly entries for depreciation, there should be a document in the file supporting your depreciation calculations.  If there needs to be a correction to COGS, then there has to be written documentation supporting it.

At my former company, they had a great, low tech method (eventually we took it all to PDF’s) that anyone starting out can use.  We labeled a file Jacket ‘Journal Entries’.  All Journal Entries were documented on a JE work sheet similar to ledger paper.  Behind that worksheet was supporting documentation.  Sometimes just an explanation written below the debit/credit would suffice.  For instance, ‘accrue January telephone expense’.  At the end of the month, we would remove the JE documentation from the file jacket and place it with our Month End closing workpapers.  The jacket was then empty and ready for the next monthly accounting period.

If you are working in an organization that pays close attention to the monthly Financial Statements ( and of course, they should be) start controlling the manual JE’s.  It’s good for you the Controller and it’s a great tool for your Accounting Staff who will learn that the General Ledger is not a playground for JE’s.  And no Journal Entry should be made unless it has been researched and approved.  This is not a small thing.  Taking your financials from materially accurate to materially not accurate needs to be prevented at all costs.






Many of us have been through the discovery of an employee who steals.  Sometimes, it is really difficult because it is someone we know and work with.  If you read the latest version of  The Global Report on Fraud you will discover that few businesses have escaped this problem.  Why is employee theft so rampant?  Many studies have estimated that one in four employees steal on some level from their employers.

I’ve devoted other columns to prevention techniques, strengthening of Internal Controls and especially segregation of duties.  However, today I want to discuss the ‘aftermath’.  When confronted with the facts, what are you going to do with a key employee, for instance, your only staff payroll person?  What about the Accounts Payable person falsifying invoices and presenting them to the company for payment (to her).  And, she’s your only A/P person and has become much more knowledgeable about the system and its inner workings than you are.

So here is a little quiz for you…………………pick the right answer for your company:

  1. Move them out of their department and away from tasks that involve cash.
  2. Leave them in the department but demote them and hire someone to take their place.  They can train the new hire.
  3. Put them on probation for sixty days and monitor them very closely.
  4. Fire them immediately

Which answer did you pick?  1…..2…..3…..4….?

If you picked any number other than ‘4’…………… question to you as a Management Consultant is:  ‘ARE YOU CRAZY?’

First, if you think that the other employees in your company are not watching every move you make, you are most likely mistaken.  News that an employee has been caught stealing can travel like wildfire even if you have tried to keep everything about it secret.

Second, anything other than firing the employee will be a signal to a lot of people that they can rationalize some very bad behavior.

Third, allowing the employee to remain in any capacity is like poisoning the well from which you drink the water.  I strongly advise against it.

Several years ago, a long time dedicated employee and single mother of three was caught taking a check, endorsing it and depositing it to her account which was discovered during a reconciliation process.  Her boss felt terribly sorry for her because he knew she was in rough financial shape.  You can agree not to prosecute.  You can agree to not challenge unemployment and you can even pay some severance (I advise against that) to help the employee while she finds another job.

However, before you write a glowing letter of recommendation or tell a caller checking her references that you regret she resigned and she was a great employee, please CONSULT YOUR ATTORNEY.

Finally, remember one thing, your leadership and management skills are on the line here.  Show decisiveness in dealing with incidences of fraud.  You will be respected for it.





NINE SCORPIONS IN A BOTTLE and other workday issues!


It’s said that the former Supreme Court Justice Oliver Wendell Holmes referred to the nine sitting Supreme Court justices as ‘Nine Scorpions in a Bottle”!.   Why?  Because each is expected to render an opinion and thus form the basis of a vote for or a dissent against the issue or case at hand.  Have you ever had a staff meeting and felt that you were dealing with people that were motivated solely by their desire to destroy you?  It may be that they just have strong opinions (i.e. they are a scorpion)!

I touched on this subject in my post ‘House of Cards’ (great for re-reading).  I’m starting to think that we need to earn a psychology degree along with our accounting degrees.  What I do know is that there are so many problems that can be avoided by structured and routine communications between you and your people.

I subscribe to some newsletters, both written by business coaches.  Their newsletters are of the ‘Dear Abby’ format where employees and employers write-in about their work problems.  One of the most common themes I see is the one about ‘my manager won’t manage us’ or ‘we have too many meetings’.   Sometimes the complaint is ‘we never meet’.

As a controller, no matter the size of your staff, you must communicate with them on a regular basis.  However, even more difficult is to hear the dissenters during these meetings.  Even the people who feel it cannot be done.  Have you ever been involved in a major software or system upgrade or new implementation.  When you start meeting with the users of the system, you will almost invariably meet with strong opposition.  Can your staff also carry the flag for that implementation and help you meet that resistance.  Do they know enough about why it is important.  If you find you do not want to deploy them as your ‘PR’ people because they really don’t understand the why or the how……………you have failed to communicate it properly.

Are you reading the accounting magazines, articles, blogs, etc. all talking about the changes we are going to see as we evolve towards the cloud?  Are you seeing articles about why we shouldn’t trust the cloud?  What about articles asking if you really need to buy a new server? Print these, or cut them out of a magazine and present it at your next staff meeting.  Get opinions,  and ask for their frank opinion.  These kinds of subjects are not fraught with politics or hidden agendas.  They are what they seem to be and the issues they raise…………you are going to be faced with them sooner rather than later.

‘Nine Scorpions in a Bottle’………….how does the Supreme Court ever render a decision?  At some point there is consensus for them at the end of the day.  They render their opinions, deliver their verdict and move on.  So it is in our line of work.  There is room for philosophical discussions regarding accounting methods and practices.  Spend some time hearing what your staff people really think.  It’s just another learning process for everyone.




If you’re not a fan of Kevin Spacey as the devious maniac & master manipulator  Frank Underwood in Netflix’s ‘House of Cards’ , let me give you some background. He was a powerful congressman slated to be tapped for Secretary of State.  However, the President’s Chief of Staff ruled him out.  Now he’s been sworn in as Vice-President, after murdering two people who were obstacles to his goals.

It’s a great series but Vice President Underwood is a scary guy.  The congressional in-fighting, the backstabbing and ‘take no prisoners’ mentality is a frightening look into the way things are at some level in too many good companies (and to some extent in Congress).  We’ve seen it on full display in ‘Mad Men’, and the sarcastic and cynical t.v. hit ‘The Office’. So what does that have to do with you as a Controller or Accounting Manager?  If your office is a kingdom of kindness, cooperation, teamwork, and respect…..then the answer is nothing.  But if there are few days that go by that you aren’t dealing with complaints by one employee against another i.e. the  smooth talker, the slacker, the sneaky one……let’s talk!

One of the biggest challenges trained accounting people face is moving into management positions and then dealing with their direct reports.  As a CPA with a BBA in Accounting, I can tell you that there wasn’t one single course available to deal with handling personnel.  I don’t remember ever seeing any CPE offerings on the subject.  We are born knowing how to breathe, but not how to manage. There are stacks of books, reams of papers and countless experts regarding inter-personal behaviors in an office setting.  You may have even found some that have helped guide you in managing your people so at least some work gets done. Recently, the Wall Street Journal published an article about ‘bad bosses’ and that the day of the ‘command and control’ boss is gone.  If you think barking orders will insure they are obeyed you may have a ‘dinosaur’ attitude of days past.  But it is you who is risking extinction.  The collaborative voices of your employees, marshalled against you can cost you your job.  I’ve seen that happen more than once. From my perspective, after having managed as a Controller in a very large privately held company, here are some of the things I believe must happen if you plan on getting anything done:

1)  Meet with your direct reports on a routine basis.  I know it’s not easy but meet at least once a week.  Schedule your meetings at 4:00 p.m. assuming quitting time is 5:00 p.m.  This way people will be less likely to ‘digress’ and you can manage your meeting to a goal of one hour.

2) Make sure when you are hiring that you have a written, very detailed job description available for the candidate.  The better people understand what is expected of them, the less conflict there is about job duties down the road.

3) Be fair and not petty!  The worst kind of manager is one who is petty.  It kills respect for you, it kills morale and it kills motivation.  Enforce the office policies firmly but fairly.  What is petty?  Denying an employee a few hours off to attend their child’s school program because they were late the day before.  Constantly denying people the equipment they need to get the job done because you worked there five years before you had one.  Get my drift?  Petty is small and mean acts against the people who work for you.

4)  During Staff meetings put as much as you can on the table about what’s going on in the company that you can share.  Keeping secrets, knowing more than they do, is also petty in this day and age of fast moving events and storms of information.  If you keep secrets when you don’t have to, so will your employees.  Count on it.

5)  Do not over share personal information about yourself.  If an employee tells you about her husband’s big promotion, or a big inheritance, be happy for them.  But do not share your life on Facebook or Instagram.  Reserve that for ‘family’ only groups.  My sister had a new manager who shared constant pictures of her children to her telecommuter employees, including a picture of her son on the operating table as he was carried in for a tonsillectomy!  But then when my sister needed time off for personal reasons it was denied.  So how do you think she felt about seeing more of her manager’s family pictures?  This is the kind of behavior that drives employees crazy and can lead to serious problems such as being pulled in by HR and questioned about your behavior.

The conversation in the arena of business management and productivity practices is gaining a lot of ground these days.  Do you really want to be like the president of AOL who fired an employee during a company wide conference call?  Maybe he was trying to prove how powerful he was.  He just proved what a terrible leader he is.  As Controllers, Accounting Managers, CFO’s, we can do better than that.




Lion Picture for Website




Every now and then I see something that just resonates with me.  It could be a phrase or a video or a picture.  So when I saw the picture of the lions and the tag line ‘Surround Yourself With People On the Same Mission as You’,  I knew I had to write about it.

A few years ago Mission statements were very popular but I don’t see the emphasis on them that there once was.  Maybe your company has one.  If so, do you know what it is?  Do your employees know what it is?  If you were asked to write a Mission Statement for your Accounting and Finance group, what would it be and why does it matter?

I have an admission to make.  I’ve never liked the word ‘teamwork’.  If you’re the Atlanta Braves it’s fine.  But a group of professionals should be encouraged to think independently.  The ability to problem solve should be valued even more than the ablity to get along with everyone in the group.  Independent thinkers don’t always have the best social skills but that doesn’t mean they aren’t intelligent people.  I will admit they can be somewhat difficult to manage but Controllers & CFO’s should interact with them on a more frequent basis to make sure they won’t self destruct inside your group.

Let’s face it, every day those of us who roam through Linked In, Facebook, e-mail, text messages, etc. are bombarded with advertisements, white papers, webinar offerings, etc.  We want to stay up-to-date but how in the world can we and still do our job.  I believe that we should first put a top priority on information that helps us align with our Mission Statement.


  1. It focuses everyone in your group on the meaning of what  each member should be doing.
  2. When hiring it sets the stage for who it is you really need to add to your group (can they live by your creed?)
  3. It explains to others what your group does (and hopefully why)
  4. It provides a philosophy for the group to live by
  5. It becomes the driving force behind what you do

Sample:  Our Finance Group’s Mission Statement -‘ To report the historical & map the future by using the best data we can’ …. or ‘to support our corporation using the right numbers’ .  I will leave it to you to come up with the right mission statement.

Let’s face it, most people know what the mission of the Credit Department is (collect all the money) or the Mail Room (deliver all the mail) but Finance and Accounting  departments are not that transparent to most people outside the finance and accounting functions.  And maybe it isn’t even clear to some of your new hires either.

Finally, get your group together around the conference table and start brainstorming it.  And if you’d rather keep it private among your group then incorporate it into your group meetings and correspondence between each other.

I don’t know if the Lions in the picture have a written mission statement posted somewhere in their den, but you can be sure they are all on the same page in this picture (most likely food!).  How do I know that?  Because they are all headed in the same direction.




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