For new and starting businesses, the first priority is survival. Most people might think that it is better to focus on making as much profits in the early stage of business but survival is much better for the long run.
While profits will add up to the survivability of the business, costs and expenses should also be kept to a minimum. For a relatively small business, the best way to do this is to do everything yourself including bookkeeping. Even though it is good for the business, more often than not, the need to hire a bookkeeper arises.
First, you should know what a bookkeeper is and what does he do. A bookkeeper is someone who maintains a record of all business transactions and activities with the purpose of keeping track and reporting the financial status and performance of the business.
They record all financial transactions in subsidiary ledgers using databases and spreadsheet programs. Basically, they record all the cash flows of a business. Other responsibilities may also include issuing checks and invoices, creating reports on profit and loss, expenditures, and tax, and preparing a payroll.
Specific roles and work responsibilities of a bookkeeper include:
1. Collect, identify, analyze, and file supporting documents of all business transactions
2. Record all financial transactions of the business, in order of occurrence
3. Ensure accuracy and completeness of all business financial transactions
4. Provide reports of business transactions for preparation of financial statements
5. Provide financial information for preparation and filing of tax returns.
6. In some cases, he is also the one who prepares the financial statements, as well as the tax returns
As a business owner with all of these responsibilities, you may be thinking right now of hiring someone to lessen your work load. An advantage of having a bookkeeper for your business is that it will lessen your responsibilities on the financial aspect of your business.
This means that you will have more time for managerial and other activities for your business. Aside from this, having someone with a professional working knowledge with all your finances may reduce errors and improve the financial position of your business.
Another advantage is that it is better to have someone with knowledge and experience working with a good bookkeeping system as it will probably improve the cash flow of the business. This is usually done by reducing costs like by paying lesser taxes after noting all deductible expenses.
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