7 Tips For Understanding The Bookkeeping Clean-up Process

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Bookkeeping is one of the most important items of any business and you definitely need to invest in it. The job of an accountant brings both worries and responsibility, but it also shows his ability to solve even the most complicated problems and shows imagination in solving them, so that job is also very stimulating.

Bookkeeping is a business function or activity that is part of a broader area – accounting. In addition to bookkeeping, accounting includes some other functions – bookkeeping planning, analysis, and auditing. In practice, bookkeeping and accounting are most often equated, while auditing has stood out as a separate function.

The main job of an accountant is to record the occurred business events, ie to record business documentation. Posting is nothing but recording business changes in a system of tables called business books. Today, posting is done on a computer, and business programs process the entered data for the needs of various users of information.

An accountant is a professional who deals with recording all financial transactions that occur in a business organization. Accountants can be employed in an accounting agency, a large company with internal accounting departments, they can establish an individual practice. Career development and continuing education are accompanied by “professional maturation”.

Professional maturation implies a “feeling” for acting appropriately in certain situations. So, let’s take a look more at their job.

Main responsibilities

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An accountant is a very important link in any business. It is up to him to check the correctness of invoices, payroll calculations, calculations with suppliers and customers, and so on. Thus, everything that a company owns, buys, or sells goes through its records. The number of accountants in a company also depends on the number of employees – sometimes one is enough, and sometimes an accounting department is created. On global-accountant.net you can learn more about it.

Today, posting is done on a computer, and business programs process the entered data for the needs of different users of information. Clients are obliged to submit the documentation for posting to the accountant as soon as possible, which they receive from their business partners and institutions such as incoming accounts, interest calculations, bank statements, and the like, in order to book them as soon as possible. The basis for posting is the original documentation.

Types of accountants

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The Ordinance establishes the following titles in the accounting profession:

  • Certified Accounting Technician
  • Certified Accountant and
  • Certified auditor.

They do a very similar job, but there are also differences. A certified accounting technician is a person who is qualified to provide support in accounting and finance. A certified accountant is a person who can work as a chief accountant, financial controller, or senior accountant in any form of company, and a certified auditor is the highest title in the accounting profession. The person holding this title is only entitled to sign the auditor’s independent opinion on the financial statements.

The accountant’s job is to identify the problem (if any)

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Before conducting a formal examination of the books, it is essential to determine whether a problem exists. There are a few sure signs that something is wrong.

  1. Missing retained earnings
  2. General ledger errors
  3. Cash discrepancies
  4. Unauthorized withdrawals
  5. Excessive business expenses
  6. Bank fees and penalties
  7. Customer and vendor invoice inconsistencies
  8. Asset overestimation
  9. Inconsistent fixed asset depreciation
  10. Negative cash or credit balances
  11. Restricted payment terms from suppliers
  12. Static inventory levels
  13. Unaccounted for interest on cash and credit accounts
  14. Muddled business loan records

What’s next?

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After identifying the problem, the next logical step follows, and that is to approach its solution. This can be a daunting task as it will require you to go through all the previous transactions carefully.

Assistance in cost management

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This is one of the key roles of a person engaged in this responsible business. These experts help the business owner keep an eye on all current and unexpected expenses. The bookkeeper thus saves the owner the time he can invest in the business of the company, acquiring new clients and expanding the business.

Reduces costs

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In addition to managing expenses, the accountant also looks for ways to reduce them. Namely, accountants know all the cakes and know how to use the legal regulations to reduce the costs of the company itself.

Also, the accountant will make the final account correctly and use the tax relief.

Desirable characteristics of an accountant

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Accountants are expected to be precise, accurate, up-to-date, systematic and accountable, in order to avoid errors in data entry and processing. Because they come in contact with confidential business information and trade secrets, accountants should be trusted individuals.

Accountants need basic computer skills to work, especially in word processing and spreadsheet programs (Word and Excel).

Why does every business need a good accountant?

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Many small business owners do not realize that a large number of businesses fail during the first year and a half of business. According to the unwritten rule, one of the most common causes is poor financial management.

This happens because business owners often keep the books themselves, which is completely wrong. Yes, it is your business and you know it best, whether you repair the car yourself because you drive it or leave it in the hands of an experienced mechanic. Well, an accountant is a business mechanic.

Final thoughts

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Paying an accountant to run your business is definitely something you can and must consider a worthwhile investment. Business owners often need to quickly get information about the potential consequences that hiring a new team member and a larger purchase of material resources can bring.

With the accountant on his side, such problems are easily solved, and the costs fit into the current situation. The accountant also provides excellent advice regarding legal issues regarding finances, takes care of duties, and deprives business owners of many other worries and problems. Doesn’t it sound good to have your “right hand” taking care of finances even when you’re not there? Better than yourself, of course.

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