How a bookkeeper can help with your business

Difference between accountants and bookkeepers

When setting up a new business, it can be confusing trying to work out everything you need to get started. Most small businesses arrange to do their own bookkeeping as they think it will be easier, but this can prove difficult when it comes to self-assessment, tax or VAT returns. Having a bookkeeper from the beginning, can help you get to grips with other aspects of your business, save you time and money in the long run and get you off to the right start straightaway.

What does a bookkeeper do?

It can be easy to get a bookkeeper and accountant mixed up – they are both working with your accounts but in very different ways. A bookkeeper will help run the day-to-day of your business, they’ll look at all the financial transactions, arrange payments and record transactions coming in. These will then all collate into one ledger so the bookkeeper can keep all your accounts up to date. A bookkeeper will then also make sure your accounts are ready for tax returns and work with your accountant to help file them.

Key responsibilities

Recordkeeping – one of the most important things a bookkeeper will do is make sure your financial records are kept up to date and that they match the bank accounts. One way of doing this is having three ledgers that they will use for your business. These are usually a supplier ledger, where anything that is paid to a supplier you use will be recorded. Any receipts or invoices from those suppliers will be lodged here as well for accuracy. A customer ledger, where payments from customer are recorded, invoices or receipts sent to customers are recorded so it’s easy to chase anything outstanding and the bookkeeper can keep an eye on what is due or paid. Finally, there is a general ledger which collates the first two and adds in any general payments that come in and out (refunds, business meetings or expenses).

Budgeting and forecasting – a bookkeeper will also work with you to stay in your budgets for the month, quarter and year and help you work out what is being spent where. They can also help you with your forecasting reports and handle the collation of reports to see what money is being spent where and how budget is affected in certain circumstances.

Tax compliance – bookkeepers are a wealth of knowledge around tax compliance and can work with you to ensure that you have everything you need to stay compliant. They’ll do reports on your finances and work with your accountant to file tax returns, so everything is done correctly. Using a bookkeeper will ensure that you have the right information, that is up to date, correct and in order before you have to file a tax return.

Using a bookkeeper has many benefits that will help your business grow – MCC Accountants can help you with any bookkeeping requirements you have. If you want to know more, give our team a call and they’d be happy to help.

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