When is it appropriate to engage a bookkeeper?

A bookkeeper's responsibilities

A bookkeeper is someone who keeps track of your company's financial activities. They also include:

• Keeping track of sales, purchases, payments, and receipts is essential.
• work on internal business process design, maintenance, and evaluation
• On a daily basis, organise, collate, and record financial data, and store this information in general ledgers.
• Keep track of your company's financial data in a common manner so that accountants can access it.

We'll look at what a bookkeeper can do for you and when you should get one for your company in this article.

What's the point of having one?

If you founded your own company, you're probably passionate about operating it and focusing on the jobs you enjoy. However, if you're like most business owners, you're not too concerned with meticulously logging every financial transaction.

Consider the following scenario: you are the owner of a hair salon. You could have:

• a straightforward business model
• a high transaction rate with a large number of clients
• dozens, if not hundreds, of sales per day
• bills for hair goods from suppliers
• Cash registers or other POS (point of sale) systems are used to track sales.
• Wages of employees must be recorded and paid.

That's a lot of data to keep track of and document. And you might not enjoy or have the time to learn about bookkeeping.

It would be easy for transactions to go unrecorded and piled up until the conclusion of a financial month if effective bookkeeping was not in place. It's possible that mistakes will be made, and critical details will be overlooked.

This is where bookkeepers may help. They can help the company by reducing the amount of work it has to do. They can eliminate the need to keep track of receipts, invoices, and other transactions on a daily basis.

What exactly do they do?

Bookkeepers are educated to record financial transactions in the same way that accountants do. They do this so that your accountant can process your financial data fast and easily. They'll do the following:

• Take all receipts, invoices, and other transaction information with you.
• Use suitable accounting practices to enter the data into accounting software.
• Assist you in making sense of the figures, such as allocating costs to individual clients.

However, bookkeeping entails more than just recording daily transactions. People that work in this field are usually well knowledgeable about accounting software. They'll be able to help you with:

• POS tools, for example, are add-on solutions that can help you streamline your business workflow.
• Payroll services to make it easier to pay your employees
• Rescue labour in bookkeeping, cleaning up mistakes caused by untrained employees
• Accounting software training for small businesses.

They can also help small business owners on a day-to-day basis. In fact, a professional bookkeeper is your partner in keeping your business running efficiently.

What distinguishes them from accountants?

A crucial service is bookkeeping. But what distinguishes it from accounting? The two services are frequently compared, however they are actually complementary:

Bookkeepers handle the day-to-day tasks and ensure that the accounts are accurate and detailed. They can also give you advice on concerns that may arise in the near future, such as cash flow issues or late invoice payments.

Accountants will review the accounts that have been generated on a quarterly basis, if not more frequently. They'll make any little alterations that are necessary. They will file tax returns and other official reports based on the information in the accounts. They will also offer high-level business consulting.

In order for your company to run properly, you'll need both personnel. To handle the day-to-day task, you'd engage a bookkeeper. You'd also engage an accountant to help you with official reporting and high-level business advise.

An in-depth look at your company

Accountants and bookkeepers deal with the same financial data from your company. They can use cloud-based accounting software to communicate that information. That means they have secure online access to your financial information from anywhere. It allows them to disclose financial statistics regarding your company's health.

As a result, they can both provide you advice on where your company is now – and where it's going.

It's common for your bookkeeper to serve as your company's primary accounting contact. They'll be in the best position to answer questions concerning money's origins and destinations.

When is the best time to hire a bookkeeper?

The sooner you start, the better. You should hire one as quickly as possible if you haven't already. You should hire one as soon as possible after launching your company.

You can end up with several months' worth of receipts and invoices to process if you don't. That will take time and effort, because you will have forgotten which client to bill for a specific expense.

For instance, you might wonder, "What was this railway ticket for?" On July 13th, who did I pay a visit to? “A bookkeeper would be able to tell which client you went to and why. They would then correctly account for the travel expense.