If you own a business of any kind you are most likely earning money (hopefully) and spending money.
A bookkeeper is the one who tracks everything that comes in and out of your business so that you have an idea of the financial position of your company.
So, what does a bookkeeper do? In this guide we will go through what a bookkeeper is, the different types of bookkeepers, as well as why a good bookkeeper is so important for your business.
A bookkeeper is someone who tracks and organizes a business’ financial transactions. Any time you make a sale or incur an expense it is the bookkeeper’s job to record what happened and post the transaction to the correct account in the chart of accounts.
Accounting is known as the oldest profession in modern human history and bookkeeping as a profession is not far behind.
In 1494, Luca Pacioli (the “Father of Accounting”) published a text called “Summa de Arithmetica, Geometrica, Proportioni et Proportionalita (Summa)” effectively creating double-entry accounting, a version of accounting that most businesses still use today.
I want to first start off by saying that bookkeepers and accountants are not the same thing.
Although accountants handle many of the same tasks as a bookkeeper, the difference between bookkeeping and accounting is greater than most people realize.
Put simply, it is the job of the bookkeeper to keep a business’ finances organized for the accountant, management, and the owner.
A bookkeeper’s responsibilities can vary wildly depending on the industry in which they work as well as the size of the company they work for. However, there are many common duties that all bookkeepers take part in completing.
Some of these common bookkeeping duties include:
Essentially a bookkeeper is there to collect financial data and organize that data into easy-to-read reports called financial statements for the accountant to use when analyzing the financial position of a company.
Now that we’ve answered the question “What does a bookkeeper do?”, let’s begin talking about the different types of bookkeeping you may encounter as a business owner.
At the very beginning stages of starting your business you may be short on funds and need to handle most aspects of the business by yourself.
When your company is small and has few transactions occurring each month this is definitely manageable, but as your business begins to grow you may find yourself being pulled into many different directions.
This can lead to some of the more tedious and time consuming tasks, such as keeping the books organized, to fall by the wayside which is a dangerous situation to be in as the owner of a growing business.
Another common problem with DIY bookkeeping is a lack of basic accounting knowledge.
Some business owners will try to save money by handling the books themselves only to realize they don’t really speak the language of accounting which leads to messy books and less-than-accurate financial data.
The next option is to hire a professional to handle all of your bookkeeping in-house which definitely has its perks but can also be the most costly option for business owners.
A full charge bookkeeper is practically the same thing as a “regular” bookkeeper except that since they are “full charge” they are solely responsible for all of the accounting.
When hiring a full charge bookkeeper to handle your bookkeeping you will also have to deal with the stress of hiring, training, and retaining this new employee.
Further, you will need to pay extra taxes in the form of payroll taxes as well as any other expenses associated with bringing on a new employee.
Luckily there is an easier, cheaper option that allows you to enjoy the best of both DIY bookkeeping as well as hiring a full charge bookkeeper.
Outsourced bookkeeping is an excellent option for business owners who do not want to deal with the hassle of recruiting, hiring, and retaining a whole new employee but also do not have the time or know-how to handle the books on their own.
Hiring an outsourced bookkeeping company, such as Noon Bookkeeping, to handle your books is slowly becoming the go-to answer to business owners’ bookkeeping problems as they cost less than hiring a new employee but also allow you the freedom to work on your business, rather than in it.
The typical freelance bookkeeper will charge anywhere from $25-$55 per hour for basic bookkeeping services.
However, when looking to hire a part-time employee to handle your bookkeeping you may be looking at $400-$800 per month plus benefits.
Further, if you wanted to hire a full-time bookkeeper to keep track of your business finances you could be paying anywhere in the range of $3,000-$4,500 per month plus benefits.
That’s where outsourced bookkeeping can be a real life-saver as you get the same dedicated, expert bookkeeping help you desire but at a fraction of the cost.
For example, depending on how many bank accounts and credit cards your business uses, our team at Noon can handle all of your bookkeeping and accounting needs for just $399 per month.
Get started with one free month of bookkeeping services so you can see how we work and we can begin to build a long-term relationship.
By now you should have a better understanding of what a bookkeeper does on a daily basis and how much you can expect to pay for one.
Now it is time to discuss the benefits of hiring a top-notch bookkeeper.
This is just the tip of the iceberg! Hiring a star bookkeeper will pay dividends for your business for many, many years into the future.
When making the decision to bring on a bookkeeper it is crucial to know what to look for as hiring a bad bookkeeper is almost worse than not having one at all.
Here’s what to look for when looking to hire a bookkeeper:
It is important to use your best judgment when hiring a bookkeeper just as you would when engaging with any other help for your business.
Noon Bookkeeping is an outsourced bookkeeping and accounting solution for business owners consisting of a team of CPA’s and certified, expert bookkeepers ready to help you organize the finances of your business.
We can handle all of your bookkeeping in one place so that you can focus on running and growing your unique business knowing that we’ve got your finances handled.
Learn more about how Noon can help you take control of your finances.
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