Bookkeeping involves the systematic process of recording, analysing and interpreting the financial transactions of a business or individual. Bookkeeping forms a large proportion of the accounting process.
A bookkeeper’s duty is to set up financial statements so that an accountant can easily perform legal and tax management in a timely manner.
A skilled bookkeeper is able to produce financial records that give a business accurate information about its financial activities. These records are critical to the future success of any business. Not only are these records necessary for the business, they are also required by law. Australian legislation states that businesses must have up to date financial records to ensure that they pay all necessary taxes and levies.
Records must be kept that are accurate and true for a period of at least 5 years from the date that the documents were prepared, obtained or the transaction completed, whichever occurs the latest. Some records, such as payroll, must be kept for a minimum of 7 years.
A good contract bookkeeper is able to:
• Set up accounting systems and software properly
• Enter transactions
• Perform checks, reconciliations and end of year processes
• Ensure they are up to speed with legislative requirements and management reports
• Undertake payroll duties and compliance
• Prepare BAS returns, as a registered BAS agent or under the supervision of a registered BAS agent
• Provide general business administrative support
Bookkeeping is something that every business has to do. It doesn’t matter how large or small your business is and it doesn’t matter where you are based – whether in an office or factory, or working from home as a remote contractor.
Getting your bookkeeping done promptly is not only important as part of your compliance requirements for the Australian Taxation Office, but the information you get from this bookkeeping data entry helps you understand how your business is performing and if there is anything that you need to change.
The bookkeeping process begins the moment you start out in business and incur expenses and most of the time spent in bookkeeping is involved in data entry and what accountants call “coding” – ie. putting each expense, income, asset and liability in the correct “account”. A simple example of demonstrating this is that costs for petrol need to go into the Motor Vehicle expenses category in your accounting software, in MYOB these expense categories start with the number 6.
When you are looking for a local bookkeeper you will most likely want to find someone who has the following attributes:
• Bookkeeping and Accounting Qualifications
• Using Accounting Software like MYOB, Xero or QBO to name a few.
• Computer Software skills in programs like Microsoft Excel
At the end of the day you want to find someone to help you do something that you MUST do because it is a legal requirement and as with all matter relating to hiring staff or “human resources” you need to hire based on a persons personality, particularly if your bookkeeper will come to your office and help you with other administration tasks.