What is Bookkeeping?

It is essential for any business to have a bookkeeping system to prevent it from failing. Bookkeeping is accounting for the financial transactions daily to keep the records current. The entries are in a double-entry system, either manually or computerized. Nowadays, a manual system is not used due to the advancement of technology.

Most companies use Microsoft Excel or accounting packages to manage their finances. A professional accounting system is vital for the company’s survival and growth. Bookkeeping is done for financial transactions, and then information is gathered from bookkeeping records to prepare the final accounts.

The tasks of a bookkeeper

An experienced staff member, called a bookkeeper, usually does bookkeeping. A bookkeeper maintains the sales and purchase records in the ledgers, which are called debtors’ and creditors’ control accounts. These accounts are checked and reconciled every month. The bookkeeper also maintains the bank transactions and reconciles the bank accounts every month.

Bookkeeping entries for every truncation have two parts. Therefore, they affect two ledger accounts. To control every transaction in every account, each account must be balanced. The debit entry on one account and the credit entry on another report must be balanced. If they do not adjust, it is evident that there are some errors.

Using Accounting packages.

The advancement of technology has helped us have fully computerized accounting systems today. There are so many accounting packages out there that it is a matter of purchasing and uploading them to the computer. If you use accounting packages to perform accounting functions, you will experience many advantages. You can produce the action fast and without errors, unless errors were made initially.