Bookkeeping is an important part of any business. It is important because from it, a business owner can gather information on how the business is doing. A small business owner is not exempted from keeping financial records of the company. She can do it herself. She can hire a complete time bookkeeper. Or in shared practice, one can outsource it to an accounting firm that offers bookkeeping sets.
Bank reconciliation is one of the bookkeeping sets that an outsourced bookkeeper can perform in a small business. It is a document that explains the difference between the cash balance as per the bank’s monthly statement of account and the company’s cash balance as per its books at a particular date, usually the end date of the statement of account. This is an important activity to check for errors in posting in both bank and company’s records.
Trial balance sheets are also one of the bookkeeping sets that the bookkeeper must perform. A trial balance is an accounting worksheet that is used to check for the mathematical correctness of the accounting balances. This document can help the business owner in decision making.
One of the bookkeeping sets the bookkeeper is required to render is the preparation of financial statements. These accounting statements are used only for internal decision making purposes. The business owner can find out about the financial position of his/her business and its financial performance which can be advantageous in making economic business decisions. These financial statements are also useful for other stakeholders of the company like its employees, its creditors, its suppliers, the government and already the general public. If these financial reports are to be shared outside the business then a CPA needs to issue a report on them. For this reason, it would be advisable to have a licensed CPA firm manager your bookkeeping.
The maintenance of the general ledger is also one of the bookkeeping sets the bookkeeper must perform for the business owner. A general ledger is the heart of the company’s accounting records. All raw data are recorded, classified and summarized into the general ledger and used as basis in the preparation of trial balance and financial statements.
Maintenance of Accounts Receivable and Accounts Payable must also be one of the bookkeeping sets. Accounts Receivable is a listing of all unpaid transactions of the company’s customers while Accounts Payable is a listing of all unpaid transactions the company owes to different suppliers. It is important that both accounts are updated because they include cash.
Payroll processing is also one of the bookkeeping sets that a bookkeeper offers to his/her client. Payroll sets must also include correct tax deductions and payment to other agencies. Computations of bonuses and other deductions are also part of this service.
In contracting an outsourced bookkeeper, a small business owner can keep in mind the following tips: decide what bookkeeping sets the company needs; search for a bookkeeper near the location of the business; and have a selection list of all possible bookkeepers who are near the business location. One should have a list of sets they offer and the fees of each bookkeeper. A business owner should make a careful evaluation prior to choosing a bookkeeper because the future of the business is at stake.