Top 12 Duties of a Bookkeeper for a Small and Mid Sized Business
In a nutshell, bookkeepers are responsible for providing accurate, up-to-date financial information about a business. In a little more detail, their duties and responsibilities are as follows:
Manage all aspects of the company’s cash receipts and cash disbursements needs Also, they should not sign any checks, nor authorize any wire transfers or ACH's.
Prepare monthly balance sheets, income statement, accounts receivable and accounts payable aging reports and with comparison to last year and last month with explanations for all significant changes resulting from the comparison.
Review and make sure accounts receivable and accounts payable are correct and reconcile to the general ledger.
Understands how to electronically send invoices and provide electronic payment choices to customers.
Make sure that all documentation for accounts receivable and accounts payable is easily accessible and stored in the Cloud.
Set up and update a remote billpaying system, which is ideal for out of office executives and owners that travel or live in another state or country, who want to electronically review the bill and check the box to approve a bill for payment. This is a useful internal control tool for absentee owners.
Reconcile bank statements and credit card statement to the general ledger at least once a month. These reconciliations should be reviewed by the owner or the company's CPA.
Working knowledge and experience with QuickBooks, Microsoft Word, Excel and Outlook
Must be able to meet deadlines
Know how to send purchase orders and maintain an open purchase order listing
Working knowledge of Generally Accepted Accounting Principles as they relate to your business
Prepare and/or submit weekly payrolls to a payroll service bureau(i.e. Intuit, ADP, Paychex, etc.) and review output and all filings. I suggest that payroll is outsourced and have the bookkeeper oversee the payroll process.
If you plan on hiring a bookkeeper, consult with your CPA to confirm your understanding of the bookkeeper's job responsibilities. Checking references for bookkeeping candidates which can be done by you or your CPA. Also, consider bonding your bookkeeper. However, I categorically urge you to have your CPA interview the bookkeeper candidates. I have a simple list of 10-15 accounting type questions, like for example, asking the candidates to explaining the debit and credit record required to record a sale on credit and how to record an accounts payable. These questions are designed to assess if the bookkeeper is critical thinker or if they do things by rote. These examples are for a simple businesses that are noncomplex. For example, a company that transacts in Crypto currencies, hedges, deals in foreign currencies, retail, manufacturers, insurance and construction are just a few examples of complex businesses. There are hundreds of more examples for complex companies. Further, for distributors, and small manufactures, that do not maintain a perpetual inventory nor track the production and sale of inventory. If you want to manage the inventory and production process, I strongly recommend that you either hire an inventory manager or hire another bookkeeper and then train your existing bookkeeper to manage the inventory process.
Your CPA can you help you determine if your business is simple or complex as well as the strengths and weaknesses of your bookkeeper. And moreimportantly, you as the owner, can also determine if your business is simple or complex. No two business are the same.
In summary, the above suggestions are generic and need to be tailored for each business. Anyone using these observations assumes full responsibilities for their use. One last suggestion, some accountants just focus on tax returns or have never taken the time to understand your business process, so ask your CPA to determine if your bookkeeper is doing their job in an effective manner. You maybe pleasantly surprised to learn that your CPA is a valuable resource and can help you.