Different Roles of Bookkeepers
Bookkeepers play a vital role in many businesses. Keeping account of all the transactions is crucial especially when tax season comes, and these professionals also help with planning for the future. And planning can play an important part on the business’ success.
If you are thinking about starting your studies to become a bookkeeper but still want to understand what the daily activities of these professionals are, we are here to help you!
First of all, don’t get too attached to preconceived notions of what bookkeepers do and the idea that bookkeeping is a tedious occupation. Every activity can be incredibly rewarding when you love what you do and feel rewarded by it. And this is not any different for bookkeeping.
As a bookkeeper you will generate financial transactions and create reports. To generate financial transactions, you will post data into accounting journals, books or software from documents such as invoices and receipts. And you will always make sure that all information is accurate. This part is very critical.
It’s important to state the difference between the role of a bookkeeper and that of an accountant. A bookkeeper is in charge of all bookkeeping actions, while an accountant files taxes and crafts annual reports. Many companies merge all the activities into just one role, but the way most companies choose to go – and consider the best – is to have a strong team of professionals across their given areas in order to create a strong accounting service team and avoid errors.
As we said at the beginning of this article, bookkeepers play a vital role in companies, and this role goes beyond keeping the company’s journals in order and accurate. The part bookkeepers play in the success of the company is more extensive. Keep reading for a list of six activities that make bookkeepers so important for companies, which you may not be aware of:
- Making sure business expenses are covered
A bookkeeper will be essential in helping a company cover its expenses. This professional keeps the financial records up to date and makes the company aware of its current assets, income and costs.
With an accurate journal of assets and costs, the company can track its activities, understand where it is spending more than it would like to, and notice unexpected debt. When potential cash flow issues are identified early, companies can fix them more quickly and avoid bigger problems in the future.
- Helping with business growth
Precise bookkeeping can help businesses to grow. When the company’s financial records are in order, it’s easier to ensure that a project will have adequate resources for completion and to plan for what is coming. Also, accurate information about the company’s financial condition and activities can play a decisive part when applying for a loan. Organized records that show correct financial activities will improve the company’s chances of getting any kind of financial assistance. And that can be critical to ignite a new project.
The business’ long-term health depends very strongly on how the company allocates its finances and how it plans for the future. No innovative project can survive without investment, and the investment must align with the company’s financial conditions. A bookkeeper is a great asset to any company because he or she keeps a necessary foot on the ground.
- Getting companies prepared for IRS audits
If a company’s financial record is completely accurate, there’s nothing to fear when audits happen. And the bookkeeper is the one with the power to make the fear of IRS audits disappear.
In case of an audit, if the company has all the financial information up to date and without errors, the audit will resolve quickly and it will be easy to prove that all the tax returns are in order.
- Making the tax season easier
The tax season happens every year; there’s no escape. And when that time of the year arrives, businesses need to be prepared. The bookkeeper can be the business’ best asset when that time comes. As a bookkeeper you will be aware of the exact tax dates and notify your superiors that the tax season is approaching, making the preparation easier, especially if all the books are in order.
Even though bookkeepers are not tax preparers, they play a vital role in tax preparation. Bookkeepers ensure that all the financial information is correct and get the files ready for the accountants so they can do their part of the job.
The IRS requires that businesses keep proof of all the financial information, including income and expenses the business had during the year. The bookkeeper will keep records of all the financial activities and set all back office processes. For that, it’s not necessary to use actual books or shoeboxes anymore; bookkeepers use Dropbox or Google Drive, or they can attach documents to transactions in the accounting system. So if you like computers, bookkeeping can be a good option for you. Your skills would come in handy.
- Keeping it all organized
The bookkeeper is responsible for making sure the company is running smoothly. Bookkeepers make sure that the payroll has no mistakes and keep track of payments and deadlines.
A great number of small businesses suffer from mistakes on the payroll, and the number one piece of advice for those businesses owners is to get a bookkeeper as soon as possible.
- Bookkeepers are also detectives
When the financial records are not adding up, the bookkeeper is the one who goes through all the information and finds the mistake to be corrected. This is crucial when businesses are preparing for the tax season. Accurate financial information is the only way to do taxes without any issues – or headaches.
Now that you’ve read the list, it should be it’s clear that the bookkeeper’s role goes beyond keeping the books in order. The job is very strategic to any organization, especially small businesses that need extra help tracking financial records, since they are usually strongly targeted by the IRS.
Bookkeeping can be a starting point
In a lot of cases these professionals start working as data entry clerk for a company, and later grow into the role of the go-to person for financial recording. They become respected because of the excellent work they are doing, all the experience they have gained and all the knowledge about the company’s inner workings they have acquired.
A bookkeeper can also become an accountant and add more responsibilities to his or her daily activities, such as performing business analyses and advising the company management or business owner. Experience and certifications might be needed for that career movement, but that is nothing that a strong education can’t give you.
How can I become a bookkeeper?
In order to become a bookkeeper, you should complete an associate’s degree in accounting or business administration. At Northwestern College you will find business programs that can give you the preparation you need to find a job placement as a bookkeeper and launch your career in as little as one year.
The Executive Accounting Degree is tailored for candidates who look for a strong education that highlights the fundamental concepts and practices of business and accounting. Some of the classes you will have at Northwestern College include:
Income Taxes for Individuals
The student is introduced to the fundamentals of federal income tax regulations. Emphasis is placed on the preparation of federal returns for individuals and proprietorships.
Income Taxes for Businesses
The student is introduced to the fundamentals of federal income tax implications and various business investments. Emphasis is placed on the preparation of federal returns for partnerships and corporate environments.
Executive Accounting Externship
This course offers students a supervised learning experience outside of the classroom. Students deal with day-to-day accounting assignments and situations, and they perform services of value for a participating employer in order to receive academic credit. There is no remuneration for this externship.
Bookkeepers can obtain certifications through organizations such as American Institute of Professional Bookkeepers (AIPB). Getting a recognized certification can translate to better job opportunities and career growth. Employers usually are interested in experience and the amount of education and certifications candidates have.
In today’s world, bookkeepers are expected to have a number of qualifications, as we mentioned before. Some other challenges for these professionals include keeping up to date with the new technology available, which can improve daily bookkeeping operations. You may also be asked to train staff, which requires strong communication skills.
To learn all the abilities employers are currently looking for in the job market, there’s nothing better than learning from those who are in the market. At Northwestern College you will get your education from instructors with recognized experience in the business world.
It’s time to leave behind preconceived notions and see that the roles of bookkeepers are not only crucial for businesses, but they can also be very exciting. Bookkeeping goes beyond keeping financial records; these professionals must pay attention to disparities and deadlines, and they end up playing a very strategic part in the business operations.
This career can be a great fit for you if you like numbers, are organized, have sharp critical thinking skills and are not afraid of challenges.
Have you decided yet? If not, go to nc.edu and discover more about program options that can help you boost your career opportunities.