What Does a Bookkeeper Do?

Bookkeeping is a way of business and life and it requires a bookkeeper. A bookkeeper is a person who collects the information on day to day business transactions. Without this individual, all heck would break loose on the financials of a business! Employees would wear paper pirate hats and joust with their office chairs. Okay. So maybe that wouldn’t happen, but understanding the importance of this position can add valuable skills to a position you could pursue. Pursuing to be bookkeeper can be the beginning of a new career step, but what does a bookkeeper do?

What does a bookkeeper do?

Using accounting software for modern bookkeeping is a whole lot easier now that computers have advanced and taken over every facet of office life. Computers are now entrusted with running accounting software that takes each accounting record or transaction and compiles it into an easy to read format. The format of invoices, payments, and debts allows a business to accurately and effectively structure their finances. Posting these financial records is the key aspect of the role. Records or “postings” keep track of the debit and credits of a business. An understanding of basic accounting is required as well as basic math skills. Fortunately, there is software that often handles those calculations for you.

Some software includes:

 

A large corporation may maintain and house their own accounting software application. Companies know that many candidates will not have the skills to work with their software and provide on the job training.

Creates and Maintains Spreadsheets

Spreadsheets provide another way of keeping records for the company. Spreadsheets allow a company to calculate things manually and can provide redundancy or duplicate records for later auditing and review. A bookkeeper knows to maintain and update these spreadsheets for accuracy. Being detail oriented is a quality of bookkeepers that comes with practice.

Record Keeping

Keeping an accurate and updated record of cash, check, and invoices make being a bookkeeper on high alert every day. That “Spidey-sense” used to find errors is something that young bookkeepers are envious of. Additional skills with computers allow bookkeepers to take on other tasks such as billing, payroll, buying of goods, and can keep track of debts. The record of a company’s accounts is called a general ledger. The general ledger is updated with the posting of debits and credits of transactions. Transactions are constantly checked and analyzed for accuracy.

Information Checking and Auditing

Many duties of a bookkeeper vary depending on years of experience and level of skill. Skills such as checking and auditing are highly valuable. Keeping tabs on receipts, postings, and drastic changes creates a sense of awareness that comes with experience. Internal auditing is often done regularly to identify irregularities and resolve them quickly. Luckily electronic billing and record keeping has made this much easier. This is especially important when preparing documents during tax season. Tax documents are prepared, by the bookkeeper, at the end of each fiscal year.

Reconciliation of Transactions

Reconciliation of Transactions bring everything together at the end of the year. Bookkeepers close accounts, post balances, and triple check for any mistakes missed over the course of the year. This is done by looking at the original records prepared and seeing if your records match with the originals. This can catch cases of fraud, but are often caught during in-house auditing. In-house auditing is done by other bookkeepers on staff. Shedding light on what the bookkeeper did and resolving any issues that come up will lead to less of a headache at the end of the year.