How to Implement Financial Controls in a Growing Startup: Tools, Processes & Frameworks That Work

This article has been contributed by Hardik Jaisingh, Director, Chief of Staff, Assiduus Global.

Why Financial Controls Matter Early

When you're building a startup, most of your attention naturally goes into the front-facing work like sales, product, hiring, and marketing. Financial systems tend to stay in the background until something breaks. But for startups to scale responsibly, setting up basic financial controls early can prevent costly mistakes and free up time for actual growth.

You don’t need to build a full-fledged finance department from day one. What you do need is a few well-placed controls that bring visibility, accountability, and rhythm to how money moves in the business.

Five Financial Priorities Every Startup Should Watch

Startups, by default, are fast-paced. Teams are often focused on product, growth, and customer delivery. In that momentum, some of the operational tasks like submitting reimbursements or reviewing monthly spends can get delayed or deprioritised. These are natural growing pains, not red flags.

Instead of reacting to issues when they occur, it's helpful to proactively ask: Where are we most likely to lose visibility? For many early-stage companies, that includes:

1. Unstructured reimbursement processes
2. Informal vendor onboarding and payments
3. Lack of real-time view into cash flow
4. No thresholds for who can approve what
5. Delayed monthly expense reviews

Mapping these out helps teams build a financial foundation that doesn’t slow them down.

Choosing the Right Tools for Control

Once risk zones are mapped, the next step is to bring in the right tools that offer visibility and control. Startups don’t need an ERP to start with. Tools like Zoho Books, Tally or QuickBooks can support basic accounting, payouts, and approvals.

When choosing tools, focus on four things:

1. Does it integrate easily with your bank and payroll platform?
2. Can you set user-level permissions and approval workflows?
3. Is there an audit trail for each transaction?
4. Can it scale to handle more complexity over time?

The goal is to avoid manual reconciliations and ensure that every expense is traceable: who spent it, who approved it, and whether it was within budget.

Defining Roles and Segregating Duties

Even in small teams, roles must be clearly defined to avoid control gaps. The person initiating a transaction shouldn’t be the one approving it. And the one reconciling accounts shouldn’t be the same person handling payments.

In a lean setup, simple mechanisms like dual approval for spends above a certain amount or maintaining an email trail of approvals can help. If using a digital tool, configure maker-checker rules. The objective isn’t to add bureaucracy, but to build guardrails that prevent duplication or errors.

Embedding Controls in Daily Operations

Financial controls only work when they’re part of the daily workflow. For example:

• Vendor payments should only be processed against an approved purchase order.
• Reimbursements should follow a monthly cut-off and require bills.
• Payroll should be calculated through integrated tools that sync with attendance systems, with exceptions reviewed before disbursal.

These aren't complicated policies, but they’re habits that encourage consistency. The tighter the loop between spend and review, the easier it is to stay on top of cash flows.

Building for Scale with The PACE Framework

As the business grows, controls must evolve. A helpful framework many teams adopt is PACE:

• Policies: Document your key financial processes and dos/don’ts
• Approvals: Define thresholds and responsibilities for each spend category
• Checks: Use automation to flag duplicates, anomalies, or out-of-policy spends
• Evolution: Review and adapt every 6-12 months as transaction volumes grow

Routine internal reviews (quarterly or biannually) can help surface process inefficiencies and pre-empt audit risks. Over time, this creates a culture where financial hygiene is baked into scale.

Reporting as a Decision-Making Engine

Accurate, timely reporting helps founders make sharper decisions. Start with a simple monthly MIS that includes:

• Cash in the bank
• Outstanding receivables
• Burn rate vs forecast
• Department-wise spend

The format doesn’t need to be fancy. What matters is that the data is reviewed consistently and acted upon. This practice helps course-correct before problems escalate.

For early-stage teams, even a shared Google Sheet with version control can serve as the foundation. As complexity grows, reporting tools or dashboards can be layered on.

Staying Ahead of Compliance

Founders should ensure that someone (an external CA, internal resource, or part-time CFO) tracks statutory requirements across the board. A simple checklist or tool like ClearTax or IndiaFilings can help automate reminders. Even if you’re not venture-funded yet, building compliance discipline early saves time during diligence and helps with long-term planning.

Linking Finance to Day-to-Day Ops

Finance controls are most effective when they’re cross-functional. For example, syncing HR data (like attendance or bonuses) with payroll systems reduces manual adjustments. Aligning procurement with budgets ensures no surprises in month-end closes.

Startups can establish basic coordination rhythms like weekly expense reviews, monthly budget reconciliations, or automated alerts for threshold breaches. These make financial controls part of the way teams work, not a separate burden.

Scenario Planning for Better Visibility

Cash runway is a founder’s lifeline. Scenario planning helps you understand how much room you actually have. At a minimum, prepare projections for three cases:

• Best case: Revenue exceeds plan
• Expected: Assumptions hold
• Worst case: Collections are delayed, burn rises

Update these monthly or quarterly, especially if you’re fundraising, expanding, or hiring. Even a simple projection can help you delay a hire or accelerate a vendor negotiation with clarity.

Training for Finance Hygiene

Everyone on the team, not just finance, should understand the basics of how money moves. Make finance hygiene a part of onboarding. Share guidelines for:

• What requires approval (and how to get it)
• What documents are mandatory
• Timelines for reimbursement, reporting, and reviews

This reduces back-and-forth, improves first-time accuracy, and builds collective ownership over company spend.

Some companies even do quarterly “finance 101” refreshers with functional heads to align expectations and highlight policy changes.

Controls Create Confidence

Well-designed financial controls aren’t about micromanagement. They’re about trust, predictability, and decision-making clarity. When everyone knows how spending works, teams can move faster, not slower.

Startups don’t need to get everything right from day one. Start with one process, maybe vendor payments or payroll, and build from there. The key is to keep evolving as you grow.

The earlier you build discipline into your finance function, the easier it becomes to scale without surprises. Because in high-growth environments, clarity compounds.

8 Effective Tools to Help You Manage Your Finances

It is important to make sure that the money you earn and spend is well accounted for. Here’s a list of tools to help you manage your finances efficiently.

StartupTalkyAnagha S