So What Exactly Is A Bookkeeper, And What Do They Do?
Ever wondered who a bookkeeper is and what they actually do all day? If you’re a business owner, chances are, you have an in-house bookkeeper or you have ever outsourced your bookkeeping, and you know a thing or two about bookkeepers. But for new business owners who have not yet used a bookkeeper, it is high time to know who these guys are and what they can do for you.
For starters, a bookkeeper is often employed by a small and/or mid-size company to maintain and record its transactions including purchases, sales, payment of bills, the collection of accounts payable and receivable, payroll, etc. A start-up company might hire an accounting firm that employs both accountants and bookkeepers.
What bookkeepers do
As every business keeps books, bookkeepers are very important. They are responsible for a large set of tasks, in addition to simple data input. Basically, a bookkeeper monitors monies flowing in and out of the business. Through maintaining accurate, organized financial records, bookkeepers assist micro businesses and SMEs to:
- Efficiently run their finances
- Stay on top of daily cash flow
- Prepare for VAT and tax returns
Aside from balancing accounts and monitoring finances, a bookkeeper’s role extends to other different tasks. They undertake data processing, invoicing and purchase orders, credit control and sales accounting, as well as cash and banking administration.
On top of this, bookkeepers are pros at ledger systems. They are good at data reconciliation, ensuring all records match cash transactions and bank reconciliations.
Do you need a bookkeeper?
While business owners can do bookkeeping, it is recommended that you hire a qualified bookkeeper to ensure accurate and quality financial data. Bookkeepers understand math, have a head of records and figures, and know what the numbers mean. If record management and paperwork are tying you down, employing a bookkeeper can free up your time and enable you to concentrate on core business functions.
Bookkeepers are also vital in business operations. They can help you make good financial decisions and track how your company dime is spent. They use accounting software to track numbers, record transactions, and take in checks and cash. More importantly, they can produce reports to help determine where business money is going and reconcile discrepancies in financial records.
What are the job requirements?
Today, bookkeeping tasks are highly sophisticated and diverse. A bookkeeper is expected to have the skilled knowledge and be comfortable using accounting software. Since many bookkeepers have a diploma, they definitely have some understanding of spreadsheets, computers, and basic accounting practices. Typical job skills and requirements include basic arithmetic and computers skills, confidentiality, and attention to detail. Also, in this day and age, you better know how to use Xero. Visit the ProAMS bookkeeping Facebook account for more information on Xero bookkeeping.
Accountant vs. Bookkeeper
In essence, bookkeepers oversee and set up daily record keeping, as well as monitor and update business books. By comparison, accountants interpret bookkeeping data to determine the business’s efficiency. Without well-organised books, an accountant cannot give valuable financial and tax advice to business owners.
For the long-term success of your business, you finances must be properly balanced, your financial records well-kept and taxes accurately filed. A bookkeeper will do that and also provide smart financial strategies, hence contributing to business growth.