Most people have a moderate understanding of the bookkeeping function. Bookkeepers bring specialized skills that cannot be compared to any latest accounting or bookkeeping application. A Software can only help you to the extent that they are meant to, beyond that, you require specialized help that might only come from a human being.
These professionals offer a range of solutions ranging from cash flow management to tax compliance to business reporting. Even with the range of services they offer, some myths about the profession have been passed down from one generation to the next.
Hopefully, we’ll debunk them today so that you can steer clear of any such misconceptions. With that, below are three of the most common myths about bookkeepers.
This is one of the biggest myths in the bookkeeping profession. Business owners believe that with accounting tools such as QuickBooks Online, Xero, or A2Xaccounting, they can get by without the help of an accountant or bookkeeper.
While that may work in some instances, you may need guidance in setting up your transaction accounts, tax rates, as well as where to post certain transactions. Bookkeepers understand the logic behind everything that goes on in an accounting system, they can easily explain to you why you shouldn’t simply label an income account as “Income” or the expense account as “Expenses”. Incomes may be derived from different sources, and so are expenses. As such, proper categorization is important.
It not unusual to see a business owner hire a bookkeeper to do data entry work as 90% of their role. Far from it, these professionals perform more than clerical tasks.
Experienced bookkeepers have spent a great deal of time in multiple roles including internal auditing, taxation, cash flow management, and payroll processing. So, the next time you hire a bookkeeper, keep an open mind for them to tell you all the services they offer. You’ll be surprised to learn that most of them don’t actually do the clerical work they tend to be associated with.
Listen, the accounting and bookkeeping profession are almost indistinguishable. While an accountant is legally mandated to perform roles such as the preparation of a company’s financial statements as well as auditing, bookkeepers basically provide the raw data for such duties. But that does not mean that bookkeepers are any lesser of professionals.
The bookkeeping function is responsible for information accuracy prior to its use by accountants for the bigger picture. Just so you know, most accountants double up as bookkeepers as a part of their role.
Other myths include:
There you have it:
What other myths about bookkeeping did you grow up hearing?