The Bookkeeper Who Will complete Your Business Year Ended Bookkeeping
A bookkeeper is one that is usually employed by a small or mid-size organization to record its financial transactions such as the purchases made, the sales, payroll, payment of bills, the collection of account receivable and the rest. A small establishment can make use of the services offered by accounting firms that employs bookkeepers.
What is the role of a bookkeeper?
Since some of the bookkeepers do not have a degree in accounting, an accounting firm will always carry out a thorough review of every financial statement prepared by the organization’s bookkeepers. The bookkeepers are required to have knowledge of different accounting software since our world is advancing daily in Information Communication Technology (ICT).
Definition of Bookkeeping
Bookkeeping can be defined as the process of recording different financial transactions of an organization. Accurate financial transactions records and proper keep assists an organisation to know the flow of income and expenditure as well as make sure the company stays within budget. This is one of the bedrock of every business.
The Roles of a Bookkeeper
From the definition of bookkeeping, the roles of a bookkeeper inside an organisation are to prepare, keep and maintain the financial transaction records of an organisation by recording such transactions daily. Bookkeepers performs the following tasks and assuming the following responsibilities
- Preparing trial balances.
- Preparing financial transaction reports.
- Preparing cash flow statements.
- A bookkeeper performs payroll administration duties.
- A bookkeeper prepares journal entries for all receipts.
- Preparing payments and other different financial transactions.
- Performing bank reconciliations.
- Filing income tax returns.
- A bookkeeper deposits the money that comes into an organisation.
- A bookkeeper pays accounts on for the organisation.
- Gives out invoices for money that is owed to the company.
- Posting journal entries to ledger accounts.
- Filing source documents for every recorded journal entry.
- Posting journal entries to ledger accounts.
Roles of a Bookkeeper in different Organizations
The role of bookkeepers may differ from one organisation to another. In a big organisation such as a company, a bookkeeper will be given precise duties that come with a limited scope. In an organization that is smaller and operation, bookkeepers may be expected to take on extra duties. These extra duties can include the works carried out by an accountant in a big organisation.
It is of paramount importance to know that not all bookkeepers performs their bookkeeping tasks as an employee of a company. A bookkeeper can also carry out his bookkeeping functions as a freelance bookkeepers or an outsourced consultant. While every organisation need the roles, functions and services of a bookkeeper to make sure all their financial transactions are correct, they may not consider employing a bookkeeper for a full-time job as necessary. In this case, a freelance bookkeepers or an outsourced bookkeeping company is needed.
Bookkeeping Skills and Training
For bookkeepers to do bookkeeping services at optimal, such bookkeepers are expected to have undergone some bookkeeping training and at the same time posses certain skills.
A bookkeeper that wants to be effective is expected to have these skills and abilities:
- Numerical skills
- Analytical thinking skills
- Communication skills
- Time management skills
- Problem-solving skills
- High levels of concentration
- Computer and ICT skills (A bookkeeper must beconversant with different but important software applications or program)
- High levels of accuracy.
- A bookkeeper must pay quality attention to instructions.
- High ethical standards
Bookkeepers can always begin working without having any particular qualifications. However, even though he can work without any certain qualification, it is important to have at least a diploma course or certification in bookkeeping. This is very important as most employers look for candidates with evidence in form of a certificate. Such employers won’t employ you if you do not possess any kind of bookkeeping certificate. Although certificate and qualification are necessary, there are many opportunities for school-leavers who have interest in pursuing careers in bookkeeping to have experience by starting out in entry-level bookkeeping positions. Bookkeepers can go more to improve their qualifications by studying further. This is good as it will advance their careers. A bookkeeper can even study any accounting related courses. This can move such person in a high position within the organization she is working in.
Difference Between a Bookkeeper and an Accountant
Most times bookkeeping and accounting is used interchangeably. Both are related but they are different. A bookkeeper is generally an individual who records financial transactions or performs different data entry tasks without having a degree in accounting. Data entry can be on bills payment, payroll data processing, vendor bills, preparing sales invoices, mailing statements to the company’s customers and others.
On the other hand, an accountant usually has a college degree in accounting or any other accounting related course. An accountant takes over the tasks left by the bookkeeper.
An accountant records different occurring expenses from the adjusting entries he prepared. These expenses were not entered by a bookkeeper. For example, the wages of employees to be prepared next week and interest made from bank loans after the last loan was paid, etc.
Other adjustments to accounts are the recording and calculation of depreciation and others. When the adjusting entries are made, the company’s financial transaction statements are prepared by an accountant. Financial transaction statements include the balance sheet, income statement, statement of cash flows. The accountant also helps an organization to know and understand their financial status and impacts now to carry out a befitting financial future decision.
The difference between an accountant and a bookkeeper progressively change as different financial and accounting application evolves.
A bookkeeper is in charge of processing and recording a company’s business financial transactions. It is expected of bookkeepers to be knowledgeable, correct and efficient credits and debits, sales and account receivable, the chart of accounts, payroll and others. Roles and responsibilities of bookkeepers differ from different organizations. Works performed by bookkeepers are overseen by an accountant. The bookkeepers should good understanding of certain accounting software to work effectively.