Running Your Business With A Bookkeeper
November 20, 2018
Running a business of any size can be difficult without a little professional intervention and guidance, such as what you might expect to receive from an accountant or bookkeeper, and they often play an extremely significant role. If you’re uncertain as to whether your business would benefit from professional help, and are unclear as to whether you need an accountant or a bookkeeper, the following guidance should be of help to you:
Accountants and Bookkeepers have different roles and duties:
For an accountant, the primary focus of their work is based upon preparing and lodging statutory return, giving advice and counsel on legal entity structures and giving general advice related to business and finance. In addition, accountants are more often than not members of a statutory association and may refer to themselves as CCA’s (Chartered Certified Accountants) or CA’s (Chartered Accountants).
For bookkeepers, they manage a variety of responsibilities within small businesses, but their primary focus is upon organising, recording and reporting the financial transactions that make up the operational life of a small business. As technology has progressed along with businesses, many bookkeepers now add the following duties to their role:
- Helping to implement POS (point of sale) systems
- Training clients to use accounting software
- Implementing document management and inventory control processes to help businesses increase their efficiency
- Helping to develop, implement, maintain and review internal business processes
More often, a bookkeeper will have an area that they specialise in, and it’s worth asking them about this when (or before) you hire them.
What exactly does a bookkeeper do?
Among a wide range of duties and responsibilities, here are some of the main tasks that a bookkeeper will perform to help keep a business operating smoothly:
- Track daily transactions – they usually take care of the recording of daily bank transactions; modern software makes this task far more efficient
- Managing accounts receivable and sending invoices – chasing late payments and managing the accounts receivable ledger is an important daily task for a bookkeeper, as is preparing and sending invoices to clients.
- Handling the accounts payable ledger – bookkeepers usually make payments on the business’s behalf, such as paying supplier invoices, expenses and petty cash.
- Watching over cashflow – running out of money is a businesses worst nightmare, so a bookkeeper will keep a check on the revenue balance and act or offer advice, if more cash is needed.
- Getting the books ready for the accountant – valid and up to date accounts are another of the bookkeeper’s responsibilities, and they will prepare them ready for the accountant to use their skills and expertise to make business recommendations, report to the board and complete tax returns for the business.
Put in its’ simplest terms, a bookkeeper handles the day to day running of a business, so that the accountant can focus his efforts on the more strategic side of the financial operations. Bookkeepers play an essential role in most businesses, large or small, and without a good and reliable bookkeeper, an accountant simply cannot do their job as effectively.