Irrespective of the business scale, type, and industry, every business organization require a finance professional who can keep track of all the financial and monetary transactions of the business on a daily basis. The primary aim of any business is to earn profits and this profit scale can only be determined by analyzing the investments, sales, and other forms of income and expense over a long period of time. Therefore, accounting and bookkeeping in Surrey are essential.
What is bookkeeping?
In simple words, bookkeeping is the process of recording and maintaining all the financial transactions incurred on a daily basis in the financial books of the business. As discussed earlier, in order to evaluate the profit made by a business, one has to assess the daily expenses and income of the organization. This analysis can be easily done if the bookkeeping is diligently done. Bookkeeping in Surrey involves maintaining a record of everyday transactions in chronological order. A bookkeeper is expected to update the financial book every day so that there’s no discrepancy in the evaluation of the company finances.
Role of a bookkeeper
A bookkeeper is responsible for maintaining the everyday transactions incurred by a business organization i.e. both income and expenditure. This daily record thereby helps in preparing the advanced financial statements on a weekly, monthly, or quarterly basis. This is an everyday task that simplifies the tasks concerning company finances, profit and loss statements, revenue evaluation, etc. Some of the day-to-day tasks of bookkeeping in Surrey involves the following:
- Basic journal entries
- Preparing trial balances, bank reconciliations, ledger, cash flow statements, etc.
- Preparing company accounts
- Filing tax
- Depositing and accepting accounts on behalf of organizations
Difference between Accounting & Bookkeeping
People often use the terms accounting and bookkeeping interchangeably which is not entirely correct. Although accounting and bookkeeping are related, there are certain things that distinguish both. While bookkeeping is a part of the accounting process, accounting happens to be a much wider concept. Following listed are the basic differences that will better explain the difference between accounting and bookkeeping.
- As stated earlier, accounting is a broader term that starts when the task of bookkeeping ends. Through bookkeeping, regular transactions are recorded which acts as the first segment of the accounting process.
- Bookkeeping is the primary task of financial accounting that acts as an information source that provides data to continue the further accounting process.
- The purpose of bookkeeping is to maintain a record of all the income and expenses incurred by the organization whereas accounting is performed to make informed business decisions based on the profit scale and performance.
Benefits of Bookkeeping
There a variety of advantages of bookkeeping in Surrey some of which are discussed as follows:
- Detailed financial recording
One of the primary benefits of bookkeeping is a detailed record of all the monetary and other financial transactions made by the business on a daily basis. No matter how big or small your business is, keeping a daily record of all the income and expenses can eliminate the chances of unnecessary or missed transactions. This detailed record also gives a brief idea of the performance of the business.
- Make informed decisions
Another important benefit of bookkeeping is that you can have an overview of the company’s performance by analyzing the difference between expenses and revenues recorded daily. Once you have a clear idea, you can certainly make well-thought decisions to maximize profits or minimize losses. Bookkeeping can help in identifying the necessary changes required to boost performance.
- Ease business accounting
As discussed earlier, bookkeeping is the basic foundation of business accounting that acts as an information source using which further advanced accounting statements are prepared. Without bookkeeping the accounting process will require additional efforts and time. Having a bookkeeper will ease the complex business accounting processes thereby giving more time for strategizing and enhancing performance.