Ask many people what they think bookkeepers do and, as often as not, the reply will be to enter the business numbers into the books, write a bunch of cheques and make bank deposits. Even many business owners and managers think this way. They’re not wrong but there is so much more.
Simply put, the bookkeeper or bookkeeping department is responsible for tracking and recording all the financial activity of a company. This includes posting of activity into a set of books or, in this day and age, into an accounting program. These books are required by various levels of government and will ultimately supply the numbers that determine the tax obligations of the company. The tax accountant will need these numbers to do the calculations and file the year end taxes. There’s more….
The bookkeeper may also be responsible for payroll if the company has employees. This would include not only the issuing of paycheques or direct deposits but the calculation and remittance of personal taxes, Canada Pension Plan and Employment Insurance. Add to this the issuing of T4s to staff and summaries to Canada Revenue Agency (CRA), as well as Records of Employment to departing staff. Not only does this need to be done but it must be done right.
Speaking of all things tax, there is often a need to track HST or GST owing and make the remittances to CRA for this. Provincial taxes for non-HST participants may also be required. Next there would be Workplace Safety Insurance Board or similar premiums, again, if there are employees. Should the business activity cross international borders, there may be a need to track exchange and manage multiple accounts. How about job costing for companies that have large projects that they want to track? On top of all of that, there is always a need to track ongoing cash flow and receivables.
A good bookkeeper will be able to tailor the books to track the finances of companies whether they are in retail, wholesale, manufacturing, construction, medical, dental, etc., etc., etc. Each of these types of businesses comes with its own unique set of challenges and requirements. Furthermore, each company within each sector will no doubt have a unique way of operating which must also be accommodated.
I think you get the picture. At the end of the day the numbers need to be in and they need to be accurate. Taxes must also be paid – preferably on time. At the end of a given period, statements need to be generated based on the numbers for interested parties like owners, managers, shareholders, the accountant and CRA. All of this falls to the bookkeeper.
Essentially proper bookkeeping involves everything from posting of raw data to the generation of statements during the year and at year end. This is what FULL CYCLE BOOKKEEPING is all about. This is what we do. I hope this gives a bit of insight into the process. By all means connect and we will tailor a bookkeeping package to suit your budget and your unique business requirements.
Until next time,