A Guide to Bookkeeping: Skills, Salaries, and Careers

Read some of our recent reviews and see what it could be like having Bench on your books. In colonial America, bookkeepers would record transactions in a “wastebook”—so called because the data would eventually find its way into an official ledger and the original book would go into the trash. As of 2021, approximately 1.7 million people worked as bookkeeping, accounting, or auditing clerks. The BLS expects the field to have a 5 percent decline in growth from 2021 to 2031. Still, you should see 197,600 job openings each year over the next decade [3].

Check for errors in reports.

While the basics of accounting haven’t changed in over 500 years, the practice of bookkeeping has. Bookkeeping was once done manually using actual books called journals https://www.kelleysbookkeeping.com/ and ledgers. Because bookkeeping is based on double-entry accounting, each transaction affects two accounts — one gets debited and the other is credited.

Consider earning a degree.

She is a former Google Tech Entrepreneur and she holds an MSc in International Marketing from Edinburgh Napier University. For example, note which software you want a candidate to be familiar with–including general programs that your office uses. Check out our helpful guide for deciding when is the right time for your business to invest in hiring a bookkeeper.

What Is Bookkeeping? Everything You Need To Know

1. Bookkeeping is the process of keeping track of a business’s financial transactions.
2. In colonial America, bookkeepers would record transactions in a “wastebook”—so called because the data would eventually find its way into an official ledger and the original book would go into the trash.
3. If you enjoy organization and numbers and have experience with bookkeeping, starting your own business offering this service might be a smart career choice.

Bookkeeping professionals have their own expertise based on the types of businesses and industries they serve. Start by deciding on the system you want to use, whether it’s an online program, paid software or a spreadsheet. Next, set aside a dedicated time either weekly https://www.kelleysbookkeeping.com/how-do-capital-accounts-in-llcs-work/ or biweekly to review your bookkeeping, reconcile transactions and complete necessary data entry. Finally, you’ll want to decide how all receipts and documents will be stored. You can either keep hard copies or opt for electronic files by scanning paperwork.

Best Bookkeeping Services

Bookkeepers might also have degrees in accounting, but most have either technical certifications or on-the-job experience. Your bookkeeper might also prepare other auxiliary reports for your business, like accounts payable and accounts receivable aging reports. You can use these to make business decisions, but they should not be presented as audited, certified or official financial statements. Broadly, a bookkeeper’s job is to manage the books by keeping track of day-to-day business finances.

Having the ability to prepare an accurate financial picture of an enterprise and keep records organized is essential for being a bookkeeper. As a bookkeeper, you will need to learn how to create balance sheets, invoices, cash flow statements, income statements, accounts receivable reports, and more. Although software and calculators do most of the math, basic skills such as addition, subtraction, multiplication, and division are essential to helping you catch errors quickly. A bookkeeper is responsible for maintaining and recording financial transactions for a business or organization.

Bookkeepers also deposit money, cash checks, and ensure correct credit card transactions. Bookkeepers play a vital role in the business accounting cycle by collecting and inputting data. As a detail-oriented professional, you would play a crucial role in the organization and growth of companies from small businesses to major corporations. You know what a bookkeeper does and what their day-to-day responsibilities look like. A bookkeeper can help ensure your business finances are organized and lets you focus on running and growing your small business.

The service you decide to use depends on the needs of your business and may include extra features such as payroll or tax documents. If you opt for bookkeeping software—like Quickbooks—keep in mind the time commitment required to learn how to properly use the program. And at a certain point, your time is better spent building your business than navigating DIY tutorial videos. Depending on the stage of your small business, you may not need to hire a full-time professional bookkeeper.

There are some financial tasks that bookkeepers aren’t equipped for; that’s where accountants come in. While bookkeepers record daily transactions, accountants use the information compiled by a bookkeeper to produce financial reports. A bookkeeper is someone who prepares your accounts, documenting daily financial how to figure shorts and over entries in accounting transactions. Bookkeepers have been around as far back as 2600 BC—when records were tracked with a stylus on slabs of clay—making bookkeeping not the oldest profession, but pretty darn close. Every business step requires capital, from transforming an idea into a model to investing in its expansion.