What is a Bookkeeper?

First, let’s define what a bookkeeper is. A bookkeeper is responsible for:

• Analyzing

• Classifying

• Summarizing

Financial transactions for your business. Bookkeepers are In charge of making sure your records are correct, accurate, and reliable. So that when it is time for reporting you can clearly see where your business stands and you do not have a panic attack when tax season comes around. They are your go-to person when it comes to recording what is happening in your business. Your business has daily activities like sales, expenses, draws and productions and so much more. Bookkeepers are the ones that decide what of these transactions are to be recorded and how to record them. This is the detailed, mundane, and important job of the bookkeepers. They are the “get your hands dirty” type of people.

CPA vs BOOKKEEPERS

So, you might think why can’t I have a CPA do this for me and have them prepare my tax as well? Well, just like Doctors there are what we call specialties. There are CPA’s that are focused on Forensic Accounting, Financial Planning, and Tax preparation. Most CPA’s don’t necessarily focus on, unless they chose to, the bookkeeping task. They assume you are doing that or have someone do that for you. They come in, look at your books, and go from there. CPA’s are more like your Doctor’s and your Bookkeepers are your nurses.

Now granted there are bookkeeping businesses out there that are owned by CPAs. Like I said earlier…unless they chose to they don’t usually do the everyday recording of your transactions.

TAX PROFESSIONAL vs BOOKKEEPERS

Tax people are like their name suggests professionals in charge of preparing your tax. They do not do the bookkeeping (daily recording of transactions) for you. They get the reports from your bookkeepers and use that information to file your taxes. Now, if you do not have proper bookkeeping then you are at risk of paying too much taxes or at risk of penalties.

So why hire a bookkeeper?

The bookkeeper’s job is detailed, hands-on, and mundane. As a business owner myself, I really do not have time to be with my books and make sure everything is recorded properly. Luckily, I have a system in place and someone working for me lol! Most clients I have that asked me to clean up their books their common line is that “My business grew and I really did not have enough time to work with my books anymore” or “ I really do not know how to handle my books”.

This record-keeping as you already know is very important. Some transactions are complicated and only someone with an accounting or bookkeeping background or experience will know how to handle it. Do you use Journal entry? Or do you create an Adjusting Entry? Is it capital or is it an expense? Is it billable? So many things to think about. To top it off depending on what accounting software you are using…You also have to know how that software works in order to have an accurate record.

Can you do your own bookkeeping? Absolutely! with support and training, I am positive you can do your bookkeeping too! I know most start-up businesses really can’t hire a bookkeeper yet. So in the meantime, I suggest get your training or coaching.

WHAT TO LOOK FOR IN A BOOKKEEPER

Here are a few suggestions in hiring or looking for the right bookkeeper for you or your business:

1. Quickbooks Online ProAdvisor Certification - If you are using Quickbooks it is important to hire someone who knows how to use the system. It does not just stop at record-keeping. If your bookkeeper does not know how to use your accounting software then it is all for naught.

2. Experience for the type of business you have - Experience in the type of business you have is a must because if they are certified and knows how the system work and does not have any idea how real estate bookkeeping should look like then you might be missing on some tax deductions. Or if your business is a Shopify dropshipping and you hired someone who does not have experienced with dropshipping then you might be missing on proper collections of Sales Tax Nexus.

Are you ready to hire a bookkeeper? Let me know! :) I would love to have a chat with you to see If we are a match. Plus you get a FREE Consultation too!