What Should A Bookkeeper Be Doing For You?

Regardless of the product or service you sell or render, two things are common with such an enterprise: you make money and you spend money. Bookkeepers are the ones that help ensure that proper records get kept.

If you have always focused on getting your business flying, you may not appreciate the work done by a bookkeeper. Here we will answer the question “what should a bookkeeper be doing for you?” We will be X-raying the day-to-day functions of a bookkeeper.

What is a bookkeeper?

A bookkeeper is a professional who helps in the preparation of accounts and helping with the day to day financial transactions.

Fun fact: The relevance of bookkeepers dates back to 2600 BC! During this time, records got tracked using a stylus on clay slabs. It may not be the oldest profession, but it sure has done its time!

Things a bookkeeper will be doing for you

• Completing payroll
• Maintenance of a general ledger
• Management of bank reconciliations
• Provisional of financial statements
• Tracking expenses and income
• Tracking accounts payable and receivable
• Running financial reports, including profit and loss, balance sheet, & statement of cash flows

Origins of bookkeepers

In the Colonia era in America, bookkeepers used to record transactions using a waste book. It got called this because the data imputed would get transferred to an official ledge while the original book gets disposed of.

In this period, any bookkeeper who knows their mettle usually uses software to check their finances. As it was with the old waste books, they would have to hand over the records in their hands to an accountant when the time comes.

What makes bookkeeping so vital?

Financial statements, bookkeeping, tax compliance as well as the management of cash flow are interwoven, and at the end of the day, revenue is what keeps a business afloat.

Vital insights into the health of the business

Bookkeeping helps the business by producing financial statements that deal with the collection of financial data and assist in creating a clear picture of how well the business is doing. These statements assist you in the management of cash flow which shows the amount of cash leaving and coming in and out of your business.
Cash flow projections are vital for the growth of a business. This is because they motivate potential investors while encouraging existing ones. Also, a larger cash flow indicates growth because it creates opportunities to expand on resources, employees, etc.

Makes auditing easier

Every business faces the possibility of getting audited one day or the other. As undesirable as it may seem, it is one thing that you should prepare for. With your bookkeeping in place and organized, you can always recall documents whenever you might need them.

It makes tax filing easier

Whenever the tax season comes around and you have to make available the needed documents for filing your tax returns, you must have the necessary documents for that purpose. So instead of searching through piles of receipts, the right bookkeeping records will make you do less work while also getting the right data at the right time.

What does a bookkeeper do each day?

The functions of a bookkeeper will always include receipt wrangling and data entry. Bookkeepers are responsible for recording each transaction contained in your general ledger by making use of a double-entry bookkeeping system. This is often referred to as recording journal entries. This implies entering transactions into the accounting software.

Having said this, bookkeeping goes beyond simply just entering numbers into a spreadsheet or accounting software; it usually requires careful analysis as well as some legal insights. The right bookkeeper would assist you in surviving an audit. This they would do by ensuring that your records are in perfect order and that the deductions are in order.

Bookkeepers are generally responsible for the preparation of four key financial statements.

• Balance sheet
  This is a snapshot of a company’s financial position per time.

• Income statement
  This is also known as the Loss and profit statement. It shows your expenses and revenue for a certain period.

• Statement of changes in equity
  This is also referred to as the statement of retained earnings. This shows the way your share of reserves, capital, and retained earnings has changed over some time.

• Cash flow statement
  This is a record of cash and cash equivalents leaving and entering your organization for a given period.

Some other vital functions they help carry out for your company for smooth operations include the following:

• Recording and remittance of sales tax to the government
• Management of accounts receivable as well as accounts payable. This means they ensure you get paid on time and that you pay your bills on time.
• Record deposits made at the bank and all incoming cash.

They are also able to handle some or all of the tax preparation procedures so that other professionals would have less work to do because bookkeepers are comparatively less expensive.

How Do I Choose A Good Bookkeeper?

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What will a bookkeeper do for your business?

You may be wondering why one needs the services of a bookkeeper; you are bound to enjoy some of the following benefits:

• Peace of mind with the knowledge that your record books are correct and when the tax season comes, there won’t be cause for alarm.
• You also enjoy better budgeting decisions; this is because you will know the exact place your money is going to.
• A better understanding of the vital metrics required for your business such as costs, revenue, and profitability.
• A better understanding of your business cash flow on a seasonal basis.

If the size of your business isn’t large, there won’t be much need for a full-time bookkeeper. You may engage the services of a bookkeeping firm to do it for you on a part-time basis. Most bookkeeping firms, like Centrosome Inc., can put together a monthly package to cover all of your needs.

In conclusion, the function of a bookkeeper is crucial to organizations of any size. This article should help you better appreciate what your bookkeeper should or can be doing for you.