For many people, the term ‘bookkeeper’ can give rise to confusion, especially since many of us use it interchangeably with another similar term, ‘accountant’. But a bookkeeper and an accountant have different tasks and roles in an enterprise, and if you are thinking of using a bookkeeper for your business, it does pay to know what to expect from one. So where does the confusion start, and what can you really expect from a bookkeeper for your business? Let’s find out.
The Difference Between The Two
In essence, an accountant is an expert in finance, while a bookkeeper is a professional in data entry – their role is to maintain your business’ financial records in an accurate way. The data which is collated by the bookkeeper can be used by your accountant and your business in order to make sound financial decisions.
Bookkeeping is actually a subset of the accounting process, and it can be performed by an accountant as well as any individual who has the proper training in bookkeeping. They will often be in charge of preparing your financial reports as well as your tax returns, and they can also provide you with the standard and essential finance infrastructure you need from which you can carry out more complex accounting processes and practices.
What a Bookkeeper Can Really Do For You
The recording and management of financial data can be quite complex, but a bookkeeper is responsible for a range of tasks that don’t just include the inputting of financial data. A good bookkeeper will be well-versed with the proper accounting software, allowing them to create financial records and reports which show your gross profit as well as specific expenses. You can also rely on a bookkeeper for the reconciliation of your data, as they can make sure that your cash expenditures and transactions match with your bank statements.
A bookkeeper’s other tasks and responsibilities include calculating investments and interest rates, managing repayments, maintaining records of the depreciation of your assets, producing and creating invoices, preparing money for your corporation tax, monitoring your orders, contacting your debtors, producing a report of your creditors and debtors, ensuring your customers are paying their debts, and paying off your creditors and suppliers such as HMRC.
Do You Need One?
Bookkeeping services are vital to any business’ operations because, without them, it will be virtually impossible for you to make sound financial decisions. It is often accountants who actually recommend business owners to have a bookkeeper because their services are essential; you can even avoid having an accountant altogether if all you need is for someone to handle and collate your transactions.
And while you may be able to do your own bookkeeping tasks, the experts would always recommend having a qualified and professional bookkeeper by your side so that you can keep the accuracy and quality of your financial records and data. With a proper bookkeeper, you can make sure your time is well spent, and you won’t be tied down with all the paperwork produced by your business – you can manage your records more efficiently and free up your time to focus on other endeavours.
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