Why do you need a bookkeeper for your business? There are many functions of a bookkeeper and they are vital in keeping your business organized. From recording financial records, producing invoices, preparing for tax, to managing day-to-day activities, a bookkeeper is someone you can rely on.
Below is a list of the roles of a bookkeeper:
1. Tracking and Managing Daily Transactions
The primary task of a bookkeeper is to manage daily financial transactions and keep an eye of the company’s cash flow. Utilizing an accounting software can streamline the records faster and easier; saving time on data entry.
Bookkeepers are responsible for balancing and updating bank accounts, reporting payments and deposits, verifying receipts and checks, and recording them accurately in the financial ledger.
2. Monitoring Cash Flow
A business cannot operate without cash. It’s a bookkeeper’s task to ensure that the company will not run out of day-to-day money. This involves keeping an eye on the revenues and expenses and tracking the financial health of the company. They offer advice and take action and make the business ready for present and future spending.
3. Reconciling bank accounts
Transactions can easily get duplicated, lost, or have some inaccuracies. To avoid messing up financial accounts and cause confusion, it is a bookkeeper’s role to reconcile all transactions to bank accounts and double-check if they match with actual balances in your financial accounts. Securing that every entry is correct gives an overview where all the money goes.
4. Sending out Invoices
A bookkeeper checks and manages the accounts receivable ledger daily. It is the bookkeeper’s responsibility to prepare and send sales invoices to customers at the billing date or by the end of the monthly cycle. Monitoring customer’s payments, making cheques/check deposits, and preparing monthly receivables reports, as well as debt collection and chasing late payments are done by the bookkeeper.
5. Processing Payroll
A bookkeeper runs your monthly payroll and makes sure that employees’ timesheets are all received. Using software to streamline the process, the bookkeeper calculates net payments, print reports and payslips, and pay salaries and wages to the employees upon authorization by the manager. They also ensure that the payroll system complies with the laws set by the government.
6. Preparing Key Financial Statements
Financial statements reflect the value and performance of the company. This is crucial in attracting potential investors or in making important financial decisions. A bookkeeper prepares significant financial statements reporting profit and loss, cash flow statements, balance sheets, and operating expenses. These will give you accurate and complete information that will help you determine where your business is at, and help you create a business strategy.
Bookkeeper plays an essential role in business. With someone handling your finances and helping in facilitating business operations, you are saving time and making work easier and more efficient. Hiring a bookkeeper is a great investment that every business owner should make. The insightful data and information help you focus on building and growing your business.