How Your Bookkeeper Can Help You Grow
Bookkeeping is the recording and managing of a business’s financial information. Transactions, expense accrual and other financial information is recorded by bookkeepers.
Proper bookkeeping allows the tracking of all the information needed to make sound financing and operating decisions.
Determining Overall Financial Health
With proper accounting, businesses keep their fingers on the pulse of their financial health. This data can be critical when seeking funding, investing and proving profitability.
Help with Making Decisions
With an efficient bookkeeper, a business can ensure accurate and efficient management of assets and liabilities. This can aid in internal decisions, like where to put a revenue surplus, as well as external ones, such as an investor’s choice to help fund the business.
Bookkeeping tracks financial progress toward goals. Your bookkeeper can keep track of sales as well as profit margins, for example, for specific accounting periods to determine which strategies you might use to reach your income goals.
What Bookkeepers Do Exactly
Bookkeeping commonly includes the following tasks:
- Recording transactions such as sales, expenses and cash flow.
- Managing bank feeds: Bookkeeping software is linked to a company’s bank accounts to allow transaction viewing in real time.
- Reconciling bank accounts: This involves reconciling company accounts to ensure information in the accounting software matches that on the company’s bank, credit and income statements.
- Handling accounts receivable and payable: Large organizations may have an account clerk for each department, but small- to mid-sized business bookkeepers are often charged with maintaining incoming and outgoing credit transactions.
- Bookkeepers are responsible for preparing financial statements and reports. For instance, a bookkeeper might organize and prepare a statement for the fiscal year that details gross and net revenue.
Tips for Better Bookkeeping
There are a variety of ways to make bookkeeping less prone to error. When considering improving your financial skills and implementing efficient methods, these tips may prove helpful:
- Set up clearly defined processes, such as when to expect financial reports, what will be included in them and how records will be managed
- Consider using software programs to manage more than one account to optimize project management and workflow
- Consider software for payroll management–or hiring a payroll company so you aren’t doing it yourself– to accurately record this aspect of operations
Good bookkeeping can mean the difference between accurately and efficiently organizing your financial data and making costly errors. If you’d rather not do it yourself, search online for bookkeeping companies nearby.