When you run a business, you need a support team in your corner to help you make a success of it. Drawing on the expertise of others so you can take the time to focus on your key strengths to deliver your product or service, is really important.
Even from the outset of setting up a business you will quickly realise you need some accounting advice and need a way to keep track of your incoming and outgoing money. So, who do you go to for help? An Accountant? A Bookkeeper? Do they do the same thing or offer something different?
We are strong believers that it is all about teamwork. There are only positives to be gained when a business owner, Accountant, and Bookkeeper work closely together. Each can bring specific skills and insights but have the common goal of supporting the business to succeed. The main difference is really when or at what stage in the financial life-cycle that each person contributes.
What does a Bookkeeper do?
Bookkeepers usually have a more transactional and administrative focus and are involved more frequently with a business to record financial transactions.
Business owners rely heavily on their Bookkeeper to support them with a range of activities including:
- setting up accounting software and bookkeeping processes
- invoicing and processing sales receipts
- entering purchases and expenses
- managing Accounts Payables and making payments to suppliers
- setting up and running payroll, plus other associated tasks related to super, long service leave or payroll tax reporting
- bank reconciliations
- preparing and lodging Instalment and Business Activity Statements, plus
- other ATO reporting requirements such as Single Touch Payroll or Taxable Payments Annual Reporting.
Today, however, being a Bookkeeper is more than just processing the above transactions accurately. Working closely with business owners to use this information to evaluate performance and plan is vital. Developing sound business processes, taking advantage of current tools, and having a sound understanding of the current environment is essential.
What does an Accountant do?
While some Accounting practices offer bookkeeping services, the majority do not. Most accounting firms provide the next level of service where they take information prepared by the Bookkeeper and assess, analyse, and interpret the information to provide further strategic advice and undertaken compliance work.
Accountants can provide the following range of support:
- business establishment and structural advice
- preparing company financial statements
- tax advice and planning
- completing income tax returns
- strategic advice around business performance, financial decisions, financial forecasting etc
What are the benefits of working together?
Organised bookkeeping and properly recorded financial information produced by a Bookkeeper, coupled with strategic financial goals and accurate tax compliance work lead by an Accountant, can only lead to improved support and performance for any business owner.
Bookkeepers are well placed to provide regular and detailed services. They understand the details of a business and can efficiently and cost effectively provide feedback, reports and meet BAS and payroll compliance requirements. Bookkeepers are also well placed to quickly provide feedback to Accountants of emerging issues.
Ultimately having information up to date makes it easier for Accountants to provide tax and other services more effectively as well
It is all about teamwork!
When should I hire a professional?
It can be difficult to decide when to engage a Bookkeeper or an Accountant. When starting a business there are often lots of expenses so many owners try to minimise extra costs. Before doing this there are some important things to consider.
When you start a business selecting the right structure to use is especially important. Taking the time to discuss this with an Accountant and weighing up the pros and cons of different structures could save a great deal of stress and money later.
Implementing sound record keeping processes and a way of capturing business income and expenses from the start is also vital. Even if a business owner decides to undertake this work themselves in the beginning it is worthwhile touching base with a professional Bookkeeper for some initial advice and tips. At least with some basic processes in place, or with some support and training, this work can be handed over later in good order.
It is critical to remember that there are minimum compliance requirements that must be met, whether that is lodging Business Activity Statements or preparing tax returns. Engaging professionals to help complete this work accurately is important.
How can Trade Guardian help?
Trade Guardian provides affordable and practical administrative and bookkeeping support to a range of small businesses. We have a growing team of highly qualified and experienced staff based in Canberra who are skilled at working with a range of accounting software products.
We also love working in partnership with you and your Accountant. When all three parties work well together great advice and support can be given to a business owner.
If you need any assistance in getting your bookkeeping processes up to date, or would like us to get in touch with your Accountant to help you out, please Contact Us.