Bookkeeping is an essential component of doing business these days. Without it, you would find it hard to avoid penalties come tax season. So, if you want to ensure that your business prospers and doesn’t get into trouble with the tax department then you should hire a bookkeeper as soon as possible. There are various tasks that fall under the umbrella of Bookkeeping services. Let’s take a brief look at them.
Recording of Financial Transactions
Bookkeepers deal with the recording and maintenance of all the financial transactions made by the business. This includes preserving receipts for sales and purchases made during a set period of time. It is the job of the bookkeeper to track down all the receipts and record them in a systematic manner. This data collection done by the bookkeeper is going to help in the development of financial statements later on. Moreover, aside from the receipts, there are other transactions that need to be recorded as well. For instance, payments made to vendors, loan repayments, bills and other operational expenses all need to be recorded by the bookkeeper.
Balancing the Books
Balancing the books is another important aspect of bookkeeping. It requires the bookkeeper ensuring that the assets of the company always come out to be equal to the liabilities and the business’s equity. In order to balance the books, the bookkeeper generally has to check and recheck all of the financial transactions multiple times over. They also need to keep an eye on the different cash accounts of the business and make sure that the accounts don’t show any kind of discrepancy.
Creating Financial Statements
Bookkeeping also involves the creation of financial statements. These are created by entering all of the data that has been collected by recording different financial transactions. These financial statements are needed by the accountant for creating financial reports for business management. Each financial statement focuses on a specific aspect of the business’s finances. For instance, there would be separate financial statements for revenue earned, cash flow and expenses. Some bookkeepers use the help of computer software for the preparation of these financial statements.
Shoebox Bookkeeping is a provider of online bookkeeping services in Sydney businesses. If you are looking for a trust-worthy bookkeeping service then we can help you out.