For Small businesses, capital management is imperative. From shaping an idea into a business model to investing in its growth, every step of the business requires capital. And to keep track of a company’s financial transactions and recording it in the company’s general ledger accounts, businesses need professional bookkeepers.
While many small businesses prefer to do their books by their own, seeking professional help is always a wise option. So what exactly does a bookkeeper do?
Here’s what you need to know about the importance of hiring a professional bookkeeper:
Bookkeeper for a Small Business
A Bookkeeper might have different tasks at his/her hand depending on the size of the business. However, the core responsibility of a bookkeeper includes recording and organizing the company’s financial transactions (income and expenses).
Why should Small Business owners hire a Bookkeeper?
Small Business owners often overlook the importance of seeking professional help when it comes to bookkeeping and prefer doing it themselves. However, it can prove to be a costly mistake at times as well as consumes enough time rather than allowing business owners to focus on core business responsibilities.
Responsibilities of a Bookkeepers at Small Business Firms:
Bookkeepers generally take care of the following for SMEs:
Record financial transactions
Keeping a record of a company’s financial transactions including income and expenses is the core responsibility of a bookkeeper. A bookkeeper records and updates the financial data in the company’s general ledger.
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Reconcile bank accounts
Reconciling financial accounts is another primary task of a bookkeeper which makes sure that the transaction details of your business on your bank account statements are accurate and matches with that on the accounting software. Regularly reconciling your financial statements is very important since it makes sure that there are no data discrepancies or other irregularities.
Billing and following up on Accounts Receivable Accounts Payable
Accounts receivable and Accounts Payable are very crucial to businesses as it defines the financial position at a given point of time. Bookkeepers usually take up this work of recording both AP and AR as they are important financial data and help in determining the debt vs credit owed by a business.
Work closely with the tax preparer
When the tax season arrives, it can get pretty hectic for the tax preparer to get the company books organized within a short span of time. However, bookkeepers keep the books well-organized all throughout the year, they serve as a mediator between your business and certified accountant.
At times, Bookkeepers can also take over payroll responsibilities for your small business or they can assist you in payroll data entry on Accounting software since payroll is a part of business expenses and needs to be tracked and recorded while maintaining company’s books.
Bookkeeping is all about maintaining your books on a regular basis and keep them well-organized for you may need them during the tax season as well as to understand your financial position which will help you in making crucial business decisions.
While it may seem to be an easy job, it requires both precision and expertise and top of that a professional bookkeeper can save your valuable time by overtaking those duties from you and you can take care of other important business aspects.