Small business operations rely heavily on bookkeeping, but how much do business owners truly understand about the profession? What exactly do bookkeepers do, and what advantages does bookkeeping offer? Beyond simply maintaining accurate and up-to-date financial records, effective bookkeeping entails comprehending business processes and maximizing efficiency.
Bookkeeping has expanded to encompass a wide range of roles. In addition to traditional bookkeeping duties, bookkeepers now also handle payroll, manage software implementation and integration, provide strategic analysis, and offer business consulting services playing a vital role. A professional bookkeeper possesses the expertise to assist small businesses in ways that can significantly enhance their overall capabilities. Above all, bookkeepers can help business owners implement and maintain optimal business processes, enabling them to gain a better, more up-to-date, and timely understanding of their business's operational and financial health. This, in turn, empowers business owners to make more informed decisions. Recent research by Intuit Quickbooks Back to Business has revealed that bookkeepers have played a crucial role in boosting confidence levels for small businesses in Australia. Key findings from the research indicate that 70% of small business owners credited their accountant or bookkeeper with helping them navigate the challenges posed by the pandemic. So, what distinguishes an exceptional bookkeeper?
1. As a skilled Bookkeeper, it is important to have a clear understanding of a business's industry, processes, and requirements. This enables them to streamline processes and provide comprehensive reports to business owners, while also ensuring that small businesses meet compliance requirements and deadlines. A Professional Bookkeeper should be a member of a professional association and remain committed to ongoing education and skills development.
2. For a bookkeeper, ethics and trustworthiness are of utmost importance. It is crucial to establish a relationship built on trust with the business owner. It is imperative to always be honest and thorough in dealings. The ICB strictly prohibits any form of dishonest activity, even if unaware. Therefore, taking due diligence in taking on clients is crucial. In case of any mishap, the bookkeeper must do the right thing and take corrective measures. Honesty and accuracy are paramount, and everything else follows from working with this fundamental attitude.
3. It's important for bookkeepers to have formal training in bookkeeping or accounting. They should also either be a BAS Agent or work under the supervision of one when preparing BAS for a business. Being a registered BAS Agent assures that the Bookkeeper has the necessary skills, qualifications, and experience to accurately account for GST and prepare BAS in accordance with the law.
4. In today's digital world, it's important for bookkeepers to stay up-to-date with the latest software knowledge. Recent research by Intuit Quickbooks Back to Business has shown that 43% of small businesses are focusing on digitizing their financial processes, making bookkeeping a top priority. According to Accountants Daily, a survey found that one in five SMEs identified accountants and bookkeepers as essential for business survival.
5. Bookkeepers are an essential part of any business community. To be successful, established, and compliant, professional bookkeepers should possess certain fundamental characteristics. One of the most important traits is excellent communication skills. Effective communication helps to ensure a smooth flow of interaction within the business. By maintaining good communication with the business owner, bookkeepers can ensure that deadlines and requirements are met, enabling the business to fulfil its reporting obligations. They should also ask relevant questions and share ideas with the business owner on matters such as financial planning, revenue growth, budgeting, cash flow, and cost-saving strategies that can help to improve the business's performance.
As a business owner, it's important to understand the benefits of having a bookkeeper. Beyond simply keeping accurate records and balancing the books, a skilled bookkeeper can bring numerous advantages to your business.
■ In today's business world, it is highly beneficial to hire a professional bookkeeper, especially with the help of technology. A bookkeeper not only maintains financial records accurately but also integrates business operations with reporting and record-keeping, resulting in increased efficiency and streamlining of processes. With the aid of technology, the job becomes much easier.
■ If you want to ensure accuracy in your financial reports and data, it's a good idea to hire a professional bookkeeper. These experts have the necessary training, resources, support and experience to get the job done right.
■ Bookkeepers are important in freeing up time for business owners to focus on core functions such as business development, refining workflows, and improving outcomes.
■ If the ATO launches an investigation into a business, it is highly advantageous to have well-organized business records that are produced by integrated and streamlined bookkeeping systems. During the investigation process, your records will be reviewed, and having complete and organized records can make all the difference. Incomplete, missing, or disorganized records can make the investigation process much more difficult than it needs to be.
■ Bookkeepers utilize their knowledge of systems, compliance, and software to enhance and refine business systems.
Although a Bookkeeper does not make financial decisions for a business, they play a crucial role in helping the business achieve success. They provide an overall view of the business's financial inflow and outflow. Bookkeeping is an integrated business system management that involves working with the business and employing the best technology-based solutions to improve efficiency. This leads to effective business processes, technology-based efficient solutions, streamlined record-keeping, invoice generation, as well as efficient purchase processing. With a Professional Bookkeeper on the team, a small business gains an expert who allows the business owner to focus on what they do best. This expert support translates to a win for the business!
ICB eBrief, Jan 2022