Accounting is the process of keeping financial records. Accurate financial accounting helps an organization keep track of its revenues and expenses and ensure that it is on budget. The bookkeeper role can perform a variety of tasks depending on the needs of the business. However, most accountants now work with accounting software. In addition, there are several things that almost any accountant can do for your business. While the role of an accountant varies considerably, accountants have a basic idea of what an accountant does.
Top essential things about the bookkeeper role
You may be wondering what an accountant does and whether you need one. We’ll tell you what a bookkeeper role can do,
1. Give you back your valuable time.
Do you really want to spend your evenings and weekends doing accounting? Even if you know what you’re doing, unfortunately, many business owners don’t. Did you know? You may think you should do it yourself to save money, but it’s best to leave the critical tasks, like bookkeeping, to a professional. In the long run, it’s an easy way to save money. A good bookkeeper role can save you time and allow you to spend your valuable time developing your business. Even if you know what you’re doing and really want to spend your evenings and weekends on accounting, many business owners, unfortunately, don’t. Did you know that?
When you start a business, it’s easy to get caught up in all the things you need to do, like cleaning the office or workspace, making tea, organizing staff, ordering stationery, buying stamps, collecting work, buying tools and equipment, going to the bank, and of course updating records and accounting!!! This may save you money initially, but all of these things keep you from making the money you were supposed to make when you started the business.
2. Bank Account Reconciliation
An accountant’s most vital task is to reconcile your financial statements. Accounting software transaction details must match transaction details on your bank account, credit card account, or other financial accounts when reconciling accounts.
To prevent overdraft penalties, illegal payments, and unlawful transactions, it’s critical to reconcile accounts regularly. Accounting software makes reconciliation relatively simple, but the manual effort is still required to ensure that all records are kept correctly.
3. Bank Transfer Management
Essentially, the accounting department or accountant must manage transactions that go through the banking channel of the accounting system. The banking channel connects the accounting software to the company’s bank accounts and provides real-time visibility of all transactions.
Depending on the functionality of the accounting software, it should be possible to categorize certain transactions automatically. For example, airline credit card payments could be automatically classified as travel expenses. Accountants having bookkeeper roles can monitor these transactions and verify that they are correctly classified.
The bookkeeper role may also need to manually add transactions that are not included in the bank tape. The transactions that need to be added may be those that occur outside the accounting system, such as cash payments or handwritten checks. They may also need to reconcile customer payments to their accounts for accounts receivable management or vendor invoice payments to their disbursement accounts.
4. Present detailed management accounts
In addition to the standard monthly reports, accountants should also prepare detailed management accounts that provide more detailed information. For example, if you sell products, you may want to get information about your top sellers and the products that bring in the most money. You may also want to compare your numbers with the previous month or year. So it would be beneficial to have reports showing month by month throughout the year.
You can also determine your break-even point, which is the amount of revenue you need to cover your overhead costs.
5. Managing Inventory Reports
For small businesses, accountants can also prepare an inventory report by taking an inventory. If there are any discrepancies, they are reported to the company so they can resolve them quickly.
In most cases, the inventory is taken at the end of the fiscal year, and the results are part of the income statement and other reports.
6. Dealing with Accounts Receivable
- Accounts receivable management can take many forms. As mentioned above, small business employees can enter their own quotes and invoices and receive payment for them.
- However, there is another option. The customer calculates the costs using standard estimating procedures and reports the total to their accountant. The estimate is then posted to the Tax King service account, and invoices are prepared and issued as the project progresses.
- Invoice preparation, mailing to clients, statement preparation, and collection assistance are all part of the billing service provided to clients.
- The client tells the accountant when payment will receive, and we enter the payment into Tax King Service and make a deposit for the amount the client has brought to the bank.
7. Accounts Payable Processing
In addition to accounts receivable, many accountants also handle their clients’ accounts payable. This means that the accountant processes all supplier invoices received by the company. The accountant records the due date of each vendor. Whether or not a discount is expected, and makes payment to the vendor. As the business grows, the accountant may delegate the approval of payments to another person. Good accounts payable management is essential for maintaining supplier relationships and good trade credit terms.
8. Working with Accountants
- One service that many accountants fail to mention is that, by default, they act as a sort of interpreter between you and your accountant or registered representative.
- Accountants have a thorough knowledge of accounting, and it can be easier for an accountant to work with a tax accountant when it comes to filing a tax return for a small business.
9. Preparation of Financial Statements
The income statement, balance sheet, and cash flow statement are the three primary financial statements most accountants prepare. Companies’ financial statements must revise monthly and at the end of the year. The income statement reflects the company’s overall profit and operating expenses. The balance sheet depicts the assets and liabilities of the business, and the cash flow statement illustrates how much money the company has coming in and going out. Accounting software enables accountants to create and distribute financial statements to other accountants and tax consultants.
10. Salary processing
- Accountants can also handle payroll and human resources. Accounting role providers can provide payroll services or assist with payroll and tax payments and form completion.
- Once the payroll service provider has provided the reports. They simply enter the payroll data into the accounting system or import it from the provided files.
- The bookkeeper role can also assist with preparing the worksheets for work and overtime pay.
11. Technology and tips to streamline processes
Accountants are also up to date with the latest technology. It’s not uncommon for a Bookkeeper role to find new applications and solutions specific to their industry, such as accounting software for sole proprietorships, especially if they have many clients in the same industry. In addition, there may be ways to reduce labor costs. Accountants like to find ways to increase their efficiency and make their back office run as smoothly as possible. In doing so, they can become an invaluable partner to your business.
Author Bio
Villie Walters Ramirez is a 32-year-old sales assistant at a tax king who enjoys accounting and bookkeeping services. She has a post-graduate degree in accounting, and she has a severe phobia of cats. She enjoys traveling A lot.