DEFINITION OF A BOOKKEEPER
A bookkeeper is basically the person who keeps track of all the money coming in and going out of a business. They’re like the financial record keepers, making sure every transaction is properly documented and organized.
Their main job is to record all the day-to-day financial transactions that happen in the company. Whenever there’s a sale made, an expense paid, or money received, the bookkeeper enters that data into the books and ledgers. They categorize and sort everything, making sure it’s all accounted for, down to the last penny.
One of the biggest tasks for bookkeepers is maintaining general ledger. This is the master file or book that holds all the financial transaction records for the company. In it is recorded everything from sales and purchases to payroll and inventory info. By keeping this ledger up-to-date and accurate, bookkeepers make it possible to generate all those important financial reports and statements.
Another key duty is reconciling bank statements. The bookkeeper compares the transactions they have recorded with what the bank has on file. This helps catch any mistakes or discrepancies and prevents things like fraud or errors from slipping through the cracks.
A bookkeeper may also handle accounts receivable. They make sure invoices go out properly, keep track of who owes the company money, and monitor incoming payments. Staying on top of this helps monitor the company’s cash flow situation.
In smaller businesses, bookkeepers might prepare basic financial statements like income statements, balance sheets, and cash flow reports. These give a snapshot of how the company is doing financially.
While they don’t usually analyze or interpret the financial data, bookkeepers are crucial for making sure all the numbers are accurate and up-to-date. Their work lays the foundation for accountants to then come in and do more advanced analysis, auditing, and advising. So in a nutshell, bookkeepers get all the financial transactions properly recorded and organized. Without their meticulous record-keeping, the whole accounting process would be a mess!