How to become a successful bookkeeper

Also, just like your business strategy is ever-evolving, so is technology. The Cloud has changed the way businesses run and keep financial records. This being said, your bookkeeper should be up to speed on these advancements to help you make the most of them, saving you time and money. When you determine which accounting software you will use, do not simply consider whether it meets your current bookkeeping needs. You should also evaluate each software system and technology for its ability to scale with your business as it grows and your back office needs expand. We encourage businesses to evaluate their current bookkeeping situation and consider hiring a bookkeeper if any of these signs resonate with their experience.

But you have to determine the applicant’s skill level and proficiency with bookkeeping tasks. Some cities and states have begun enacting pay transparency laws where companies must list a target salary or a salary range in the public job ad. Even if your company doesn’t have an office in one of these locations but you’re open to hiring someone remotely, you’ll need to comply with these laws. However, if you’re hiring a freelance bookkeeper, you may not have to consider such compliance laws—more often than not, these only apply when hiring an employee. Duplicate payments to vendors or past due balances – indicates a lack of good processes, organization, or otherwise inaccurate accounting that could be costing the business money.

If you are interested in becoming an accountant, it may be beneficial to your career to become a certified public accountant , which has its own exam. You must have a minimum of 150 postsecondary education hours, or what amounts to a bachelor’s degree in accounting, and an additional 30 hours of graduate work. Bookkeepers may start working for a small business to gain experience and then go back to school for a degree in accounting or finance. Enrolling in one of the best online bookkeeping classes is a smart way for those interested in this career to bolster their existing financial knowledge. Some of the key tasks for accountants include tax return preparation, conducting routine reviews of various financial statements, and performing account analysis.

Basic Math Skills

It’s a move that shows your clients that you’re at the forefront of the industry and committed to providing them with the best possible bookkeeping service. There are many in-person and online courses to become a certified bookkeeper, making it possible even for those with full-time jobs to complete a course. They don’t manage money directly, but they ensure everything is accounted for properly, so you know what’s going on with your business. Bookkeeping is also one of the most crucial parts of managing your finances.

According to BLS data, bookkeeper salaries range from as low as about $29,000 to over $60,000. Although these are fairly wide ranges, they can be narrowed down based on your industry, the experience of the bookkeeper, the nuances of your business, and your company location. When interviewing applicants, you need to know that candidates have the right skills for the job. Open-ended questions and icebreakers are great ways to start a conversation with an applicant.

A Brief History of Bookkeepers – The Jobs, Skills, Salary & Career Paths of Bookkeepers

Consider contacting your potential bookkeeper’s professional references for additional testimony. Include a real-life scenario in your interview with prospects accompanied with “What would you do?

Companies often throw around titles without thinking about how the job title describes the duties for that role. A bookkeeper is different from an accountant, a comptroller, a financial analyst, and other finance-related positions. While bookkeeping is more than just copying numbers into a spreadsheet, it is a basic finance position, so you don’t need to look for someone with decades of experience.

Problem-solving skills

A multinational corporation performs hundreds of transactions a second, while a small business might perform less than a hundred in a day. Attention to detail – By the nature of the role, a bookkeeper must have a keen attention to detail. They should have an ability to identify errors and balance accounts on the fly. They should be able to generate timely and accurate financial reports that are clear and concise. This typically comes at the end of the financial year, when clients’ books need to be “closed” for tax season. Your bookkeeper may not be able to devote as much attention to your business during this time of year as they normally would.

• However, significant differences exist, like work conducted in each career and needed to be successful.
• Considering HR outsourcing for your business, but wondering why use a PEO?
• We proudly provide all the in-person and virtual services you need to take your business and your life to the next level without stress, overwhelm, or outlandish fees.
• What a bookkeeper does can help you and your business win in the end.
• This lets them avoid the kinds of service gaps that may crop up with an individual freelancer.

For example, if you run a restaurant where employees routinely have tips, minimum wage is frequently an issue. So, make sure your job description is clear about the job history and experience you need. Simply put, a good bookkeeper should be competent in utilizing the accounting software. One of the best ways to test this is ask them to train a staff member on the system. If the bookkeeper doesn’t know the job well enough to teach someone else, it might be a sign that the bookkeeper isn’t as skilled as you might think.

Your bookkeeper should have a respectful attitude during your interactions. But they should also be willing to go above and beyond to help you implement a solid business financial strategy. We’re focused on the five qualities of a good bookkeeper today, but we also cover the five fundamentals of a good financial business strategy here. Your bookkeeper should have a well-oiled system for interpreting data, preparing reports, and storing files.

These records were called “wastebooks” because it would eventually be passed onto an official ledger, then the original book would be thrown into the waste (i.e. garbage). When customers don’t pay on time, your business’s cash flow can dry up fast. Pay attention to when your receivables are due and contact late-paying customers right away to nudge them along. Even if a customer is having financial problems, you may be able to set up a payment plan to get at least some of what you’re owed. A certified public accountant is a designation given to those who meet education and experience requirements and pass an exam. A bookkeeper is skilled at keeping documents and tracks a wide net of financial information.

What is a Bookkeeper?

Ebony Howard is a certified public accountant and a QuickBooks ProAdvisor tax expert. She has been in the accounting, audit, and tax profession for more than 13 years, working with individuals and a variety of companies in the health care, banking, and accounting industries. With a reliable bookkeeper, you can focus on your business instead of constantly worrying about cash flow and expenses. Ultimately, a proficient bookkeeper gives you invaluable insight into your company’s finances, allowing you to make better decisions. The annual salary of a full-time bookkeeper, according to the Bureau of Labor Statistics , averaged about $45,000 in 2021.

You could also implement a unified communications system that guarantees efficient business communication with your clients. This means being responsive to clients’ queries, keeping them updated on their account status, and proactively communicating any changes that may affect them. Good communication is essential for building trust and maintaining solid client relationships. The bookkeeping industry has come a long way, thanks mainly to the invention of new technology and software.

Time-tracking and payroll automation by adopting an automated system for capturing project-related costs and employee time, you can easily feed this information into your bookkeeping system. The person who opens the mail should keep track of checks in a physical paper log of what checks were received and when. The checks should be handed over to the bookkeeper or accountant with a copy of the list. This covers both the person who opened the mail, and the bookkeeper or accountant. Not only will this be immensely helpful come tax time, it will also prevent you from accidentally forgetting that the ream of paper you purchased was actually for home use. If you’re going to work in a business, you need to be able to keep your word and do what you say you’re going to do.

These programs usually take one year to complete and give students the foundational skills necessary to work as a bookkeeper. Earning an undergraduate accounting certificate also meets the qualifications for many bookkeeping jobs. Brandon, is a well-seasoned accountant and heads up the team with 25+ years of senior accounting experience. He holds an Accounting degree with a Minor in Business Administration and a Masters in Accounting. He maintains several certifications and holds various industry related licenses in tax preparation and planning. When Brandon isn’t in the office, you’ll find this avid dog and animal lover supporting various Bay Area – and beyond – animal charities.

This diversion of time and resources can hinder the growth of the business and result in missed opportunities. It’s not only data entry, receipt wrangling, labeling expenses, indicating payments of employees and consumers, and keeping records of all the receipts. They do more than making your records in order and make sure your deductions are legal. Today things are handled a bit differently due to technological advances. That’s due to bookkeepers handing the records off to an accountant come tax season . Therefore, those who do not like math, get confused easily when making simple calculations, or are generally opposed to number crunching should not apply.

The data you are given may be very confidential, specifically the ones involving financial transactions. So make sure to keep them that way, and at the same time, provide a transparent approach to your co-workers when needed. Here are the basic concepts you can learn to get started right away to do the books like a pro. Use accounting software to centralize financial information and automate services to increase your efficiency. There are many different programs out there that can help you get started on the right foot.

Also, if you have catch-up bookkeeping for them to complete, that will be an additional, one-time project that they need to handle. On average, freelance bookkeepers charge lower rates than firms do, since they have less overhead. These common problems can be scary, but they can be dealt with if you know what to do and are ready. In this blog post, we’ll explain exactly what a bookkeeper is and look at their average salary expectations, job demand information, and needed skill sets to become employed in the field. In the world of finance, problems and issues will undoubtedly be knocking on your door every once in a while. Hence, you need to possess the calmness to first, spot those issues long before others, and then solve them.

A freelancer may or may not have what is internal control in accounting working directly with CPAs. Ask about this during the consultation process, to determine their capacity for helping an accountant file your taxes on time. Unless your business has roughlythirty or more employees, or over a million dollars annual revenue, you probably don’t need to hire a full-time, in-house bookkeeper. The Bureau of Labor Statistics of the United States says that the median annual salary for a bookkeeper is $45,560. However, the amount of money a bookkeeper makes can range widely depending on factors such as their level of education, where they work, and how much experience they have. The next thing you’ll need to do is decide whether your bookkeeping will use a cash basis or an accrual basis.