What are the Essential Qualities of a Bookkeeper?

Are you an accounting enthusiast? Accounting is all about analysing and recording the financial transactions of a business or an organisation. It’s essential to accurately calculate, pay taxes and record financial transactions. Then you must know about Bookkeeper and the responsibilities of a bookkeeper. Even though everything is computerized, bookkeeping has to be done manually. Therefore it is a time-consuming process.

In this session, we are going to discuss bookkeepers, the responsibilities of bookkeepers, and the qualities of a bookkeeper.

Who is a Bookkeeper?

A bookkeeper is the person who keeps record of every financial transaction of an organisation such as purchases, expenses, sales revenue, invoices and payments. They are also involved in the preparation of tax returns, annual financial statements and reports of the company. They extract relevant and up to date information about the business when requested. 

The main two tasks of a bookkeeper is to accurately record the daily transaction of the company and perform bank reconciliation on the daily basis. Also a bookkeeper generates monthly, weekly, and daily reports on the basis of requirements of the company. 

Difference Between Accountant and Bookkeeper

An accounting cycle has eight steps : new transactions, journal entries, posting, trial balances, worksheets, journal entry adjustments, financial statements, and closing the books. The bookkeeper is responsible for the first six steps. Accounting is responsible for the last two steps, which involves preparing the balance sheet, income statement, cash flow statement, and closing the books.

Bookkeeper Qualification

Qualification can vary depending on your organization’s needs. Following are the qualification needed to be a bookkeeper :

• Bachelor’s degree in finance, accounting or related discipline.
• CPA is desirable.
• Previous bookkeeping experience preferred.
• Experience working in a fast-paced environment.

Responsibilities and Job Duties of Bookkeeper

Responsibilities of a bookkeeper can vary from business to business. There are a number of very common bookkeeping responsibilities. 

Some of the most common responsibilities of a bookkeeper are :

• Maintaining records of financial transactions by posting and verifying.
• Defining bookkeeping policies and procedures.
• Establishing different accounts.
• Maintaining balanced ledger.
• Preparing trial balancing for the accountants.
• Preparing financial reports by collecting, analysing, and summarising accounting for information.
• Reconciling entries to balance subsidiary accounts.
• Developing systems to account for financial transactions by establishing a chart of accounts.
• Recording of debits and credits.
• Monitor any variances from the project budget.
• Ensuring compliance with federal, state and local legal requirements.
• Assisting in financial activities such as running payroll and generating invoices
• Use knowledge of local laws to comply with reporting requirements.

Relevant skills and Knowledge 

A bookkeeper must have the basic knowledge on accounting. Because they have to deal with the financial matters of a company. Also they have understanding accounting best practices. A bookkeeper must have data entry skills and proficiency in Microsoft Excel. Have the knowledge of IFRS, U.S GAAP or another accounting framework. Also they need to have the knowledge on applications such as QuickBooks, Zoho, XERO, Fresh Books etc. 

Bookkeeper must produce excellent communication skills and relationship building skills. Producing work with a high level of accuracy and professionalism and organization skills are much needed qualities of a bookkeeper. To be a bookkeeper you must need a degree or at least one year of experience.

Attention to details helps bookkeepers be accurate when handling their company’s financial data.another skill needed by the bookkeeper is that invoicing, it means the process of itemizing a transaction and explaining each charge on a bill. Bookkeepers use critical thinking to solve problems and resolve challenges when working with company records. Bookkeepers have great organization skills to help them to prioratize and plan their tasks. Time management is another skill that is needed to be a bookkeeper. Which allows them to meet deadlines and accomplish all of their responsibilities within the time. 

Since bookkeepers deal with confidential information, it’s important for them to be honest and transparent. Having excellent memory guides bookkeepers when recalling past information. Having good memory makes you better at keeping financial transaction information, answering client questions and noticing errors in your files. 

These bookkeeper skills help to highlight in your resume. Also in cover letters you can expand your skills on bookkeeping that you shared in your resume. In the interview you can highlight your soft skills. 

Benefits Of Bookkeeping

• Detailed recording : A bookkeeper will always keep detailed records up-to-date.
• Always comply with the law : Always comply with the latest legal regulations. Make sure all the accounts and books are up to date with any recent legal changes.
• It is easier to plan : Once you record the company’s accounts it’s easier to plan and predict the future.
• Instant reporting : Always have an updated balance sheet to inquire about the current state of the accounts.
• Better relation with Banks and Investors : Improve business relations with investors and shareholders.
• Better tax prediction : You can keep eye for trends in business and be more confident about taxes.
• Faster business response time : You will be able to react quickly to any changes that happen to the market or to your business.
• Faster financial analysis : It’s less expensive so it helps you to know having detailed records on accounts.
• Easier audits : You will have much easier time conducting an audit than you would if your accounts are messy, disorganised, or outdated.

Strength Of A Bookkeeper

Passion for numbers and solving problems is a strong asset for a prospective bookkeeper. A bookkeeper has the complete knowledge of the best accounting practices, laws and regulations are essential. They will be able to guide your business strategy to grow and succeed. 

When you hire a bookkeeper, you have wider choices. If you want to be a bookkeeper it’s necessary to know about accounting. There are so many courses that provide accounting basics. Finprov is one of the learning institutes for all your queries about accounting and financing.