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New Controller Guidebook #362026

Course Overview

Credit

Amount

CPA

Course Author: Steven M. Bragg, CPA Field of Study (CPA): Accounting

Course Description

Course publication/revision date: This course was updated on 4/10/2026.

The accountant needs to be competent in many areas in order to be an effective controller – the person responsible for all accounting operations. The New Controller Guidebook covers every aspect of being a controller, including the management of accounts payable, cash, credit, collections, inventory, payroll, and more. The course also shows you how to close the books, which reports to issue to the management team, how to create a budget, and how to select and install an accounting computer system. In short, this course provides the accountant with the most essential information needed to be a successful controller.

Table of Contents

Chapter 1 The Controller Job Description1

Learning Objectives	1
Introduction	1
The Controller Job Description	1
The Chief Financial Officer Job Description	3
The New Controller Checklist	5
Summary	7
Review Questions	9

Chapter 2 Cash Management10

Learning Objectives	10
Introduction	10
Controller Responsibilities	10
Overview of the Bank Reconciliation	10
The Bank Reconciliation Procedure	11
Bank Reconciliation Problems	12
The Bank Reconciliation Statement	12
Accounting for Petty Cash	13
The Cash Forecast	15
Cash Investments	18
Negative Cash on the Balance Sheet	18
Cash Controls	19
Cash Record Keeping	20
Summary	20
Review Questions	21

Chapter 3 Credit and Collections Management22

Learning Objectives	22
Introduction	22
Controller Responsibilities	22
Receivables Measurement	22
Credit Management	24
Credit Terms and the Cost of Credit	26
Collections Management	27
Other Cash Acceleration Techniques	29
The Allowance for Doubtful Accounts	30
The Direct Write-off Method	32
Credit and Collection Controls	33
Summary	34
Review Questions	35

Chapter 4 Billing Management36

Learning Objectives	36
Introduction	36
Controller Responsibilities	36
Billing Management	36
Structure of the Invoice	38
Accounting for Billings	40
Accrued Revenue	41
Accounting for Sales Taxes	42
Sales Tax Exemption Certificates	45
Sales Tax Audits	46
Errors in Compliance	47
Audit Best Practices	47
Billing Controls	48
Summary	49
Review Questions	50

Chapter 5 Inventory Management51

Learning Objectives	51
Introduction	51
Controller Responsibilities	51
The Periodic Inventory System	51
The Perpetual Inventory System	52
How to Set Up Inventory Record Keeping	53
Cycle Counting	53
Inventory Reconciliation	55
The Physical Inventory Count	56
Inventory Costing	57
The First In, First Out Method	57
The Last In, First Out Method	58
The Weighted Average Method	60
Standard Costing	61
The Retail Inventory Method	62
Accounting for Obsolete Inventory	63
Summary	64
Review Questions	66

Chapter 6 Fixed Assets Management67

Learning Objectives	67
Introduction	67
Controller Responsibilities	67
Fixed Asset Tracking	67
Tag Tracking	67
Bar Code Tracking	68
RFID Tracking – Active Transmission	68
RFID Tracking – Passive Transmission	69
The Fixed Asset Physical Count	69
Accounting for Fixed Assets	70
Fixed Asset Controls	72
Controls for Fixed Asset Acquisition	72
Controls for Fixed Asset Theft	73
Controls for Fixed Asset Disposal	73
Fixed Asset Record Keeping	74
Audit Requirements	75
Summary	76
Review Questions	77

Chapter 7 Accounts Payable Management78

Learning Objectives	78
Introduction	78
Controller Responsibilities	78
Accounts Payable Management	78
Three-Way Matching	81
Use Taxes	81
Unclaimed Property	82
Accounting for Accounts Payable	83
Accounts Payable Controls	84
Accounts Payable Record Keeping	85
Summary	86
Review Questions	87

Chapter 8 Equity Management88

Learning Objectives	88
Introduction	88
Controller Responsibilities	88
Accounting for Stock	88
The Sale of Stock for Cash	88
Stock Issued in Exchange for Non-Cash Assets or Services	89
The Repurchase of Stock (Treasury Stock)	89
Accounting for Dividends	91
Summary	93
Review Questions	94

Chapter 9 Payroll Management95

Learning Objectives	95
Introduction	95
Controller Responsibilities	95
Payroll Cycle Duration	95
Streamlined Timekeeping	97
Timekeeping Systems	98
Computerized Time Clocks	98
Internet-Based Time Tracking	100
Electronic Payments	100
Payments by Direct Deposit	101
Payments by Pay Card	102
Employee Self-Service	102
Manager Self-Service	103
Transaction Error Analysis	103
Staff Training Program	104
The Payroll Calendar	105
Information Confidentiality	106
Accounting for Payroll	106
Primary Payroll Journal Entry	106
Accrued Wages	108
Accrued Bonuses	108
Accrued Commissions	109
Manual Paycheck Entry	110
Employee Advances	111
Accrued Vacation Pay	112
Payroll Controls	113
General Controls	113
Payroll Calculation Controls	114
Check Payment Controls	115
Direct Deposit Controls	115
Self-Service Controls	116
Garnishment Controls	116
Employee Advances Controls	116
Summary	116
Review Questions	118

Chapter 10 Department Management119

Learning Objectives	119
Introduction	119
Controller Responsibilities	119
Schedule of Activities	119
Error Tracking System	120
Process Reviews	121
Queue Management	122
Department Layout	123
Skills Review and Training	124
Remote Work	125
Consolidate Accounting	125
Summary	126
Review Questions	127

Chapter 11 Closing the Books128

Learning Objectives	128
Introduction	128
Controller Responsibilities	128
Prior Steps: Update Reserves	128
Core Steps: Issue Customer Invoices	129
Core Steps: Value Inventory	130
Core Steps: Calculate Depreciation	132
Core Steps: Create Accruals	136
Core Steps: Consolidate Division Results	136
Core Steps: Eliminate Intercompany Transactions	136
Core Steps: Review Journal Entries	137
Core Steps: Reconcile Accounts	137
Core Steps: Close Subsidiary Ledgers	139
Core Steps: Create Financial Statements	139
Core Steps: Review Financial Statements	139
Core Steps: Accrue Tax Liabilities	140
Core Steps: Close the Month	140
Core Steps: Add Disclosures	140
Core Steps: Write Cover Letter	141
Core Steps: Issue Financial Statements	142
Delayed Steps: Issue Customer Invoices	142
Delayed Steps: Closing Metrics	142
Delayed Steps: Document Future Closing Changes	143
Delayed Steps: Update Closing Procedures	143
The Soft Close	144
Summary	145
Review Questions	146

Chapter 12 The Financial Statements147

Learning Objectives	147
Introduction	147
Controller Responsibilities	147
The Income Statement	147
Income Statement Overview	147
The Single-Step Income Statement	151
The Multi-Step Income Statement	152
The Condensed Income Statement	152
The Contribution Margin Income Statement	153
The Multi-Period Income Statement	154
How to Construct the Income Statement	155
The Balance Sheet	156
Overview of the Balance Sheet	156
The Common Size Balance Sheet	159
The Comparative Balance Sheet	160
How to Construct the Balance Sheet	161
The Statement of Cash Flows	164
Overview of the Statement of Cash Flows	164
The Direct Method	165
The Indirect Method	167
How to Prepare the Statement of Cash Flows	168
The Statement of Retained Earnings	170
Overview of the Statement of Retained Earnings	171
How to Prepare the Statement of Retained Earnings	172
Open Book Management	172
Summary	173
Review Questions	174

Chapter 13 Public Company Financial Reporting175

Learning Objectives	175
Introduction	175
Controller Responsibilities	175
Interim Reporting	175
The Integral View	175
The Discrete View	176
Comparison of the Integral and Discrete Views	177
Interim Reporting Issues	177
Segment Reporting	177
Primary Segment Reporting Issues	177
The Segment Report	180
Earnings per Share	180
Basic Earnings per Share	180
Diluted Earnings per Share	182
Presentation of Earnings per Share	185
The Public Company Closing Process	186
The Form 10-Q	187
The Form 10-K	188
The Disclosure of Non-GAAP Information	190
Summary	191
Review Questions	192

Chapter 14 Management Reports193

Learning Objectives	193
Introduction	193
Controller Responsibilities	193
The Duration of a Report	193
Responsibility Reporting	193
The Flash Report	194
Expense Reporting	196
Margin Reporting	197
Variance Reporting	200
The Purchase Price Variance	201
Material Yield Variance	201
Labor Rate Variance	202
Labor Efficiency Variance	203
Variable Overhead Spending Variance	204
Variable Overhead Efficiency Variance	204
Fixed Overhead Spending Variance	205
Selling Price Variance	206
Sales Volume Variance	206
Problems with Variance Analysis	207
Which Variances to Report	207
How to Report Variances	208
Summary	209
Review Questions	210

Chapter 15 Ratio Analysis211

Learning Objectives	211
Introduction	211
Controller Responsibilities	211
Deflated Sales Growth	211
Deflated Profit Growth	212
Core Earnings Ratio	213
Margin of Safety	214
Interest Coverage Ratio	215
Return on Equity	215
Days Sales Outstanding	218
Best Possible DSO	219
Inventory Turnover	219
Sales Productivity	220
Sales Backlog Ratio	221
Measurement Consistency	222
Measurements and the Soft Close	222
Summary	223
Review Questions	224

Chapter 16 Budgeting225

Learning Objectives	225
Introduction	225
Controller Responsibilities	225
The System of Budgets	225
The Reasons for Budget Iterations	228
Overview of the Revenue Budget	229
The Ending Finished Goods Inventory Budget	231
The Production Budget	234
Production Budgeting for Multiple Products	235
The Direct Materials Budget (Roll up Method)	236
The Direct Materials Budget (Historical Method)	237
The Direct Labor Budget	238
The Manufacturing Overhead Budget	239
The Sales and Marketing Budget	241
Diminishing Returns Analysis	243
The Research and Development Budget	243
The Administration Budget	245
The Compensation Budget	247
The Budgeted Income Statement	250
The Budgeted Balance Sheet	251
Accounts Receivable	252
Inventory	253
Fixed Assets	254
Accounts Payable	255
Additional Estimation Elements	256
The Cash Line Item	257
The Financing Budget	258
The Compiled Balance Sheet	259
Summary	260
Review Questions	262

Chapter 17 Capital Budgeting263

Learning Objectives	263
Introduction	263
Controller Responsibilities	263
Overview of Capital Budgeting	263
Constraint Analysis	264
Net Present Value Analysis	265
The Payback Method	267
Capital Budget Proposal Analysis	268
The Outsourcing Decision	269
Complex Systems Analysis	270
The Capital Budgeting Application Form	271
The Post Installation Review	273
The Lease versus Buy Decision	274
Summary	275
Review Questions	276

Chapter 18 Computer System Selection and Installation277

Learning Objectives	277
Introduction	277
Controller Responsibilities	277
Computer System Selection	277
Requirements Development	277
The Request for Proposals	279
Bidders Conference	280
Proposal Evaluation	280
Demonstrations and Reference Checks	282
Computer System Installation	283
Electronic Spreadsheets	285
Summary	285
Review Questions	286

Answers to Chapter Questions287

Glossary306

Index311

Course Details

Author: Steven M. Bragg, CPA

Steven Bragg, CPA, has been the chief financial officer or controller of four companies, as well as a consulting manager at Ernst & Young. He received a master’s degree in finance from Bentley College, an MBA from Babson College, and a Bachelor’s degree in Economics from the University of Maine. He has been a two-time president of the Colorado Mountain Club, and is an avid alpine skier, mountain biker, and certified master diver. Mr. Bragg resides in Centennial, Colorado. He has written more than 300 books and courses, including New Controller Guidebook, GAAP Guidebook, and Payroll Management.

Publication/Revision Date: 4/16/2026

Course Exam Questions (online): 90 (multiple-choice)

Program Delivery Method: NASBA QAS Self-Study

Available Formats of Course Text: PDF or PDF plus printed copy sent in the mail

Course Level, Prerequisites, and Advance Preparation Requirements

License	Course Level	Prerequisites	Advance Preparation Requirements
CPA	Overview	None	None

* This program is appropriate for professionals at all organizational levels.

Sponsor ID Numbers

National Registry of CPE Sponsors ID: 107615

State CPA Board Sponsor ID Numbers (where applicable)

Florida Division of Certified Public Accounting: 0004761

Hawaii Board of Public Accountancy: 14003

New York State Board for Public Accountancy: 002146

Ohio Accountancy Board: CPE .51 PSR

Pennsylvania State Board of Accountancy: PX178025

Texas State Board of Public Accountancy: 009349

Learning Objectives

As a result of studying the course material, you should be able to meet the objectives listed below:

Recognize the functions of the controller position, and which functions do not involve the controller.
Identify the considerations involved in creating a system of measurements.
Identify the key elements of the accounting for cash.
Specify the measurements that can be applied to the credit and collection processes.
Cite the techniques and accounting used for credit and collections.
State the main aspects of billing preparation and accounting.
Recognize the systems used to calculate the cost of inventory.
Identify the key elements of the accounting for fixed assets.
Cite the major accounts payable processes.
Identify the key elements of the accounting for equity.
Recognize the techniques used to improve the processing of payroll.
Itemize the methods used to establish a system of management over the accounting department.
Cite the main steps used to close the books.
State the reports that comprise the financial statements.
State the concepts and tests needed to create public company financial statements.
Cite the types of management reports that the controller should produce.
Itemize the ratios that can be used by the controller.
Recognize the component parts of a company's budget.
Identify the main methods used to investigate requests for capital spending.
Specify the uses to which a post installation review can be put.
Cite the considerations involved in the selection of a computer system.
Describe the nature of a bidders conference.