What does a good bookkeeper do? 7 Key Characteristics of a Good Bookkeeper
The role of the traditional bookkeeper is changing. Traditionally bookkeepers were employed to do data entry – put in all bills, invoices, payments and receipts, and then produce reports. Nowadays, with automation, the role of a good bookkeeper has changed. A good bookkeeper understands your business, and should be able to recommend systems and procedures to improve your business efficiencies.
- Most businesses are using accounting software – your bookkeeper should know how to use the latest features that reduce the time spent on the accounts.
Some examples of these features are:
- Bank feeds – the details in the bank statements and credit card statements can be brought directly into your software. Rules can be set up so that regular transactions are automatically recorded, customer and supplier payments can be automatically applied to the suggested invoices and bills.
- Time capture – staff can record time sheets that link into payroll
- Awards – some systems allow for payroll to be set up with award interpretation, reducing the risk of paying incorrectly.
- Supplier bills – pdfs can be brought directly into your software and key information scanned and entered automatically
- Supplier relationship – some key suppliers have relationships with the software houses so that bills appear automatically in the software with all details recorded
- Employee portals – employees can access their pay slips and apply for leave and see leave approved
- Employee expense management – submissions of claims and repayments managed
- Mobility – key areas of business managed on the smart phone or tablet eg time tracking, quotes and sales, customer payments
- Your bookkeeper should be able to recommend systems that help your business.
There has been an enormous growth in Addon software that is usually specific to a particular industry vertical. These addons manage the operations or address key problem areas that are outside the scope of accounting software. A good bookkeeper will be aware of the main Addons for your business and should be able to make suggestions to guide you. An excellent bookkeeper will learn the addons that your business uses and help manage them.
- Your bookkeeper should know all the compliance needs of your business and not miss deadlines.
Most businesses have mandatory reporting around GST, PAYG, Superannuation, Payroll tax, Workers Compensation and Fringe Benefits. A good bookkeeper knows what reporting is due and has it prepared, accurate and submitted by the due date.
- A good bookkeeper values accuracy.
There is no point relying on information that is wrong. A good bookkeeper should review the accounts, including balance sheet accounts, and be able to see if the figures look incorrect. They will problem solve and correct errors.
They will value reconciliations – they will reconcile the bank accounts, the credit card accounts, any clearing accounts like superannuation owing, PAYG owing, GST accounts etc. They will liaise with the accountant.
They will manage the payables so that suppliers are paid in a timely manner and not paid twice. They will ensure that debit notes are honoured. They will reconcile the supplier statements against the business records.
They will manage the receivables so that debtors pay and there is a process for reminding overdue debtors and chasing delinquent payers.
- A good bookkeeper loves information
A good bookkeeper will produce reports on business performance. At a minimum they will provide profit and loss statements and balance sheets. There are many important aspects of a business, so the bookkeeper will know which reports are useful for the business owner and managers and make sure that data is recorded in such as way as reports can be produced, and then run the required reports on a regular basis. You shouldn’t have to ask for the reports – they should appear on your desk or in your inbox.
- A good bookkeeper understands the importance of budgets and cashflow
A bookkeeper should be able to project the forthcoming performance of the business, based on the past. They know that budgets are necessary to set financial goals and to motivate staff to achieve these goals. They know how to measure whether the actual figures are meeting the budget or not, and how to report on them. They also believe the old adage “Cash is KING” and know how to project what the cash position will be in the future so that the business can avoid running short and plan future expenditures and the timing of such expenditure.
- A good bookkeeper understands ATO legislation
They know what the ATO requires and ensure that your business is meeting those standards. For example, if you get frustrated by your bookkeeper chasing you for bills and dockets, rest assured it is because you have a good bookkeeper who knows that there must be evidence of business expenditure in order for it to be claimed as an expense. A good bookkeeper will question transactions that look like they are of a personal nature.
If you’re not getting what you need from your current bookkeeper, give us a call. Better still have a look at our bookkeeping plans. We are bookkeeping experts.
Bookkeepers4u (subsidiary of 2 Peas PL) 03 9939 4480
– Pam Pitt