Kristena Wozniak knows it can be complicated to start a business. As the vice president of business development at Propeller Industries, she works for a company that provides strategic finance and accounting support for nearly 300 early stage businesses. She’s seen plenty of entrepreneurs struggle to understand the distinct functions and roles within accounting and finance. Those problems can compound especially as a startup begins to scale.

Here are Wozniak's suggestions for early stage founders.

1. Understand the difference between a bookkeeper and controller. 

Think of accounting as the real-time flow of money. Bookkeepers handle the day-to-day transactional work such as reconciling bank accounts, posting payroll entries and processing invoices.  

Using basic bookkeeping is fine when you’re just starting a company, Wozniak says.

When you are approaching a couple of million in revenue, you need more help to understand your financial performance to date and the capital you’ll need to continue to grow, she says.

That’s where a controller comes in. This person is in charge of the accounting department and handles the more complex accounting issues such as trade spends, subscription-based productions, deductions and reconciling inventory at the end of the month as well as managing cash flow. They also own the monthly close process that offers a historical snapshot of how a company has performed.

“A controller isn’t going to be focused just on revenues and associated costs,” she says. “But the balance sheet and ensuring your books are truly captured on an accrual basis.”

2. A controller will help manage accurate inventory and where costs should be allocated.

Having proper cost allocation is essential for any business. A good controller will help founders understand some of the minutiae within payroll, including:

A controller will also work with your internal operations team to get accurate updates on inventory at each location to gain a better understanding of what is sitting within a manufacturing facility, raw materials, finished products or a combination of both. They’ll also help keep track of the number of finished goods being held within a warehouse, if the inventory was actually shipped out, and if the inventory is being accurately reflected in the revenue.

3. Recognize that a CFO or finance director is focused on the future, not the past.

While a controller is looking at what has already happened, the role of a chief financial officer or finance director job is to be “forward-looking.” They rely on financial data to plan for the future.

4. Consider hiring someone between a CFO and the controller.  

Usually, between a CFO and controller, there’s a finance director or a vice president of finance who helps with strategy, financial planning and analysis by reviewing various forecasting models.

This is someone who is digging deeper into data from the sales team and reviewing pricing models of products or services.

5. A good CFO is constantly thinking about what is next.

The best CFOs are trying to answer the question: “What's our next move?”

They’ll ask questions such as:

6. The amount of time you’ll need from a CFO grows over time.

The time you’ll need a CFO is going to be more “ad-hoc,” Wozniak says when you need to make major business decisions involving capital and growth.

“In a very early stage company, the amount of time that you need from a CFO is a very small component of the work,” Wozniak says.

That changes when a company begins fundraising. Then, she says, it’s important to have a CFO who knows exactly what investors are going to be looking for, how to determine the best strategic partners who can help you prepare a long-term plan.

7. Make sure you pick the right team.

Regardless of how you quickly or slowly you scale, it’s important to partner with the right people. “We joke it's easier to get divorced than split up with an investor,” Wozniak says. “You want to make sure you are picking the right team.”