What is Bookkeeping?
We get asked this questions a lot. Simply, Bookkeeping is the art of taking all of your business
transactions, and collating them in one space so you can track your business performance and
ensure you are up to date with your financial obligations.
What does a Bookkeeper Do?
A bookkeeper will record all of your business transactions, usually in an accounting software,
throughout the financial year ready for your local accountant to prepare your company or
personal tax returns at the end of the financial year.
Do I need a Bookkeeper?
The answer is most likely Yes! Why? Because outsourcing to the right Bookkeeper can
alleviate a multitude of stressors from your business. The right Bookkeeper will get the
back end of your business running smoothly. They will ensure all of your accounts reconcile, payment obligations, tax and GST lodgement’s are up to date and ensure you are claiming
every taxable expense. A good Bookkeeper will also be able to manage your cash flow, payroll,
as well as some admin tasks.
What are Business Transactions?
Business transactions means all of the transactions related to your business. This could be
invoices, purchases, tax or GST payments, payroll, superannuation payments, bank transactions and transfers, credit card payments and even general journals.
How does a Bookkeeper track Business Transactions?
For most businesses it is essential to use an accounting software, like xero. not all businesses need to use a software and a spreadsheet may do the trick, but in most cases, especially where accounts receivable and accounts payable need to be tracked a software is recommended. A Bookkeeper then uses bank and credit card statements/feeds to record and reconcile all incoming and outgoing transactions. At the end of the week/month/year if these transactions have been entered correctly the balance on the bank account or credit card will be the same as the balance in your software.
How do I know if a Bookkeeper is good?
There are a few questions that you should ask before you decide on a bookkeeper:
1. What qualifications do you have? The answer should always be an accredited certification. This should be backed up with a Tax Practitioners Board accreditation.
2. What are some of the industries/sectors are you familiar with? You want someone who is familiar with your industry. You don’t want a Bookkeeper who is unsure what can and can’t be claimed in your industry.
3. What services do you offer? All bookkeepers will offer different services. Some full package services may include reconciliations, payroll, accounts payable & receivable, cash flow management, GST/BAS reporting, full end of year management and hand over to your accountnant and other bookkeeping firms may only offer basic services like reconciliations and
GST/BAS reporting. You want to establish that the firm you choose is going to be able to service your business needs.
Most importantly you should get a good vibe from your Bookkeeper. You want to make sure that you are going to feel comfortable inviting that person/business to be apart of your business. The bookkeeper you choose could be your local bookkeeper, or could be a virtual bookkeeper offering an online bookkeeper service, either way, you have to