Small business bookkeeping
Record management and bookkeeping are crucial to business success. It is highly recommended this task be handled by a professional bookkeeper, but it is beneficial for a small business owner to have some basic knowledge. This document provides small business owners an overview of the responsibilities of a bookkeeper.
We use a small business called “SB Co.” as an example. The following summarizes the tasks performed by the bookkeeper of SB Co.
Accounts receivable (customers)
“An enterprise’s purpose begins on the outside with customer.” When customers need products or service, they send in an order to tell SB Co. what they need. We call it a sales order. SB Co. ships the products or provides the service according to the order. An invoice will then be issued to the customers asking for payment. After customers receive invoices, they make payments to SB Co.
The bookkeeper in SB Co. is responsible for recording the sales orders, preparing invoices to customers, recording the payments from customers, and depositing the payments to bank.
Accounts payable (suppliers)
Now let’s look at the other side. SB Co. needs to buy materials, inventory products, office supplies, equipment, services, and etc. It may start from placing an order to its suppliers. We call it a purchase order. Suppliers ship products or perform services according to orders received from SB Co. They will also send their invoices to SB Co. for the products shipped or service done. We call them bills. It is now SB Co.’s turn to make payments.
The bookkeeper of SB Co. is responsible for preparing the purchase orders, processing bills, and preparing payments to suppliers.
Payroll (employees)
Another important job is paying employees. If there weren’t taxes, the work would be simple. For example, if an employee works 40 hours a week with a rate of $25 per hour, the weekly salary will be $1,000. We will just cut a check for $1,000 and it is end of story. But tax departments require employers withhold payroll taxes, such as ZZZ Pension Plan, Unemployment Insurance, Federal Withholding taxes, and etc. It makes the job much more complicated. So the bookkeeper’s primary responsibility in this area is to calculate the payroll taxes according to regulations and then to issue pay checks.
Tax returns (government)
Now we have deal with customers, suppliers and employees. Who else do we need to deal with? The government! As soon as I say government, I guess taxes pop up in your head. Yes, generally we need to file returns for Payroll and Sales Taxes, etc. Some companies hire accountants to do it. But, for small businesses, it actually should be the job of the bookkeeper.
Bank reconciliation
As you can see payments are the major transactions. And the main tasks for a bookkeeper are to process payments. The bookkeeper of SB Co. has to process payments from customers and prepare payments to suppliers, employees, and the government. So the bank accounts become the center point of the book and need to be reconciled. The purpose of bank reconciliation is to make sure transactions are recorded completely and accurately.
There are some other tasks for a bookkeeper, such as preparing necessary reports, assisting accounts, and etc.
“Remember that time is money”
-Benjamin Franklin
About the Author
Do you every wish there was an easier way to manager your books!
Kathy Eisenhauer owns Small Business Bookkeeping Service.
I have the experience to get your Accounting and Bookkeeping organized as well as special projects. I have used different accounting software, but specializing in QuickBooks accounting software from setup through year end. I can provide all accounting services that your office does not have the time or knowledge to accomplish. Free up your time to do what you do best, make money without having to worry about your office accounting and bookkeeping.Contact me today.
Sunday, May 16, 2010
Tuesday, April 6, 2010
Choosing a Bookkeeper for your Business
Choosing a Bookkeeper for you Business
An important decision every business owner faces in setting up their business is how to ensure their books and records are maintained in accordance with accounting principles.
There is a prevalent notion among business owner’s that the bookkeeper’s role is to that of a data entry person. Some business owners may hire a relative for this job or delegate it to a secretary without careful deliberation of their qualifications. Poor kept books and records lead to costly administrative down time and loss of revenue.
When it comes to the preparation of the monthly bank reconciliations and monthly financial reports, you need a good bookkeeper with above-average analytical skills, as they are often required to identify and rectify discrepancies in the course of their duties.
“Remember that time is money”
-Benjamin Franklin
Choosing a bookkeeper for you business
Bookkeeping is an important decision every business owner faces in setting up their business. How to ensure their books and records are maintained in accordance with accounting principles is very important to their success. Most business owners don’t realize how important bookkeeping is to their bottom line.
There is a prevalent notion among business owner’s that the bookkeeper’s role is to that of a data entry person. Some business owners may hire a relative for this job or delegate it to a secretary without careful deliberation of their qualifications. Poor kept books and records lead to costly administrative down time and loss of revenue. A knowledgeable bookkeeper will help save you lots of money in the long run.
When it comes to the preparation of the monthly bank reconciliations and monthly financial reports, you need a good bookkeeper with above-average analytical skills, as they are often required to identify and rectify discrepancies in the course of their duties. A good bookkeeper will update your accounting from the data you provide and produce monthly financial statements. It is highly recommended this task be handled by a professional bookkeeper, but it is beneficial for a small business owner to have some basic knowledge. Bookkeeping is definitely more than just data entry and balancing a checking account.
Now that you are armed with this knowledge, go out and hire a good bookkeeper.
“Remember that time is money”
-Benjamin Franklin
About the Author
Do you every wish there was an easier way to manager your books!
Kathy Eisenhauer owns Small Business Bookkeeping Service. I have the experience to get your Accounting and Bookkeeping organized as well as special projects. I have used different accounting software, but specializing in QuickBooks accounting software from setup through year end. I can provide all accounting services that your office does not have the time or knowledge to accomplish. Free up your time to do what you do best, make money without having to worry about your office accounting and bookkeeping. Contact me today.
An important decision every business owner faces in setting up their business is how to ensure their books and records are maintained in accordance with accounting principles.
There is a prevalent notion among business owner’s that the bookkeeper’s role is to that of a data entry person. Some business owners may hire a relative for this job or delegate it to a secretary without careful deliberation of their qualifications. Poor kept books and records lead to costly administrative down time and loss of revenue.
When it comes to the preparation of the monthly bank reconciliations and monthly financial reports, you need a good bookkeeper with above-average analytical skills, as they are often required to identify and rectify discrepancies in the course of their duties.
“Remember that time is money”
-Benjamin Franklin
Choosing a bookkeeper for you business
Bookkeeping is an important decision every business owner faces in setting up their business. How to ensure their books and records are maintained in accordance with accounting principles is very important to their success. Most business owners don’t realize how important bookkeeping is to their bottom line.
There is a prevalent notion among business owner’s that the bookkeeper’s role is to that of a data entry person. Some business owners may hire a relative for this job or delegate it to a secretary without careful deliberation of their qualifications. Poor kept books and records lead to costly administrative down time and loss of revenue. A knowledgeable bookkeeper will help save you lots of money in the long run.
When it comes to the preparation of the monthly bank reconciliations and monthly financial reports, you need a good bookkeeper with above-average analytical skills, as they are often required to identify and rectify discrepancies in the course of their duties. A good bookkeeper will update your accounting from the data you provide and produce monthly financial statements. It is highly recommended this task be handled by a professional bookkeeper, but it is beneficial for a small business owner to have some basic knowledge. Bookkeeping is definitely more than just data entry and balancing a checking account.
Now that you are armed with this knowledge, go out and hire a good bookkeeper.
“Remember that time is money”
-Benjamin Franklin
About the Author
Do you every wish there was an easier way to manager your books!
Kathy Eisenhauer owns Small Business Bookkeeping Service. I have the experience to get your Accounting and Bookkeeping organized as well as special projects. I have used different accounting software, but specializing in QuickBooks accounting software from setup through year end. I can provide all accounting services that your office does not have the time or knowledge to accomplish. Free up your time to do what you do best, make money without having to worry about your office accounting and bookkeeping. Contact me today.
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