A Guide to Bookkeeping: Skills, Salaries, and Careers

The overall best bookkeeping software includes Zoho Books, FreshBooks, Xero, and Intuit QuickBooks. Learn more about the best bookkeeping software for small businesses. Accountants are more specialized, so not every company has an in-house accountant. You can use a firm or work with accounting software for your business needs.

• When you can’t see your finances, you can’t create cash flow formulas to determine how much money is coming in and out of your business.
• Tasks, such as establishing a budget, planning for the next fiscal year and preparing for tax time, are easier when financial records are accurate.
• As an independent business owner, you’ll have to learn how to do your freelancing taxes too.
• If you’re considering becoming a bookkeeper, read our guide to learn how to start a bookkeeping business in 2024.
• When doing the bookkeeping, you’ll generally follow the following four steps to make sure that the books are up to date and accurate.

AIPB also has extra courses for sale, such as mastering double-entry bookkeeping. However, these courses are not required knowledge for the CB exam. A bookkeeping certification not only adds value to your skill set but also helps you stay on top of the latest trends and technological advances in the industry. Read on to learn what you need to know about becoming a certified bookkeeper. As more people move to working from home, freelancing, or starting their own businesses, you may want to learn how to become a virtual bookkeeper. A virtual bookkeeper must meet the same educational requirements as an in-house or in-person bookkeeper.

Small Business Bookkeeping (2024 Guide)

Candidates must meet similar eligibility requirements for the CPB license and the CB credential. It was once common for a high school diploma to serve accounting for subscriptions revenue journal entry as the minimum education for an entry-level bookkeeping job. However, employers today may prefer candidates with a relevant degree or certificate.

Candidates must pay an additional $98 to purchase the two workbooks, which contain the exams for parts three and four. If your goal is to grow your business, you will eventually need to hire professionals to manage your bookkeeping. It will be less time-consuming and expensive to work with a part-time partner now. They can ensure you have the right systems in place as you scale.

There’s good news for business owners who want to simplify doing their books. Business owners who don’t want the burden of data entry can hire an online bookkeeping service. These services are a cost-effective way to tackle the day-to-day bookkeeping so that business owners can focus on what they do best, operating the business. For business owners who don’t mind doing the data entry, accounting software helps to simplify the process. You no longer need to worry about entering the double-entry data into two accounts. You can earn certification from the National Association of Certified Public Bookkeepers (NACPB) and the American Institute of Professional Bookkeepers (AIPB).

But depending on your situation, proper bookkeeping can also come with a steep learning curve. Overall, the labor market for bookkeepers is projected to decline as more complex accounting software platforms automate some of these professionals’ duties. Even so, the BLS projects more than 170,000 bookkeeping job openings per year from 2020 to 2030. Businesses with a significant number of invoices in accounts payable or receivable may employ dedicated bookkeeping clerks for these transactions. Accounts payable bookkeepers help protect companies’ credit standing by ensuring they meet financial obligations on time. Accounts receivable bookkeepers collect money owed to the business and report delinquent accounts.

• Test-takers must complete the first two parts of AIPB’s CB exam in person at a Prometric testing center.
• You also need to keep yourself updated on the latest industry standards to ensure you provide the best service to your clients.
• Paper-based bookkeeping means gathering your physical papers and records and reviewing them in person.
• Since nearly anyone can call themselves a bookkeeper, you’ll want to ask about their background.
• These don’t require you to go to school or gain any special training, but they may be skills you’ll need to develop over time.
• After my role as a staff accountant, I moved to a financial analyst position and then to a controller position, all at larger publicly traded companies.

This can help you keep your own business expenses organized and separate. If you plan to hire employees, such as an administrative assistant, you may also want to seek a small business loan. If you seek funding from a bank or investor, your business plan will be especially important because it is how potential lenders and investors will understand your business. Kelly Main is a Marketing Editor and Writer specializing in digital marketing, online advertising and web design and development. Before joining the team, she was a Content Producer at Fit Small Business where she served as an editor and strategist covering small business marketing content.

How do I start a career in bookkeeping?

The cost to become a CPB includes four courses and their respective exams. If you purchase these materials as a bundle, they cost $1,276 in total for members, and $1,596 for nonmembers. CPB licensure lasts one year, after which you must demonstrate that you completed all necessary continuing education credits and pay an annual membership fee. CPB credentials require 24 hours of continuing education per year of licensure. The amount bookkeepers charge will depend on where they’re located, experience, industry type, and other services needed.

How Do I Know When I Need a Professional Bookkeeper?

The service you decide to use depends on the needs of your business and may include extra features such as payroll or tax documents. Start by deciding on the system you want to use, whether it’s an online program, paid software or a spreadsheet. Next, set aside a dedicated time either weekly or biweekly to review your bookkeeping, reconcile transactions and complete necessary data entry.

Provide financial statements

You may handle payroll functions as a bookkeeper, keep tax withholding records, and issue paychecks or send information to a contracted payroll service. Depending on the organization’s size, keeping track of business expenses and reconciling business statements may be your responsibility. You typically maintain accurate accounting records across all transactions while communicating with others. A bookkeeper’s job comprises maintaining and balancing financial records, including transactions from coworkers. Effective communication is essential for recording those daily transactions. If you’re interested in an analytical, business-minded career, becoming a bookkeeper (especially a virtual bookkeeper) might be the right choice.

How long does it take to train as a bookkeeper?

Intuit provides its employees with supplemental learning materials after training has been completed to assist employees in developing their skills. Bookkeeping is a great place to start if you’re hoping for a way to break into the finance industry. There are many bookkeeping job opportunities and generally fewer education requirements than in other finance and accounting positions.

Companies often outsource the organization of their finances to independent professionals, then hire accountants for more complex issues and tax filing. Unlike certified public accountants, bookkeepers don’t file tax returns or audit financial statements. Unless they are a certified public accountant (CPA), bookkeepers should not prepare tax returns or sign the returns as a paid preparer. In these programs, you can learn accounting principles, accounting software, payroll, how to prepare financial statements, and more. The American Institute of Professional Bookkeepers offers certification for experienced bookkeepers.

(More on that shortly!) They also depend on what level of services you’re looking for. I didn’t go to what felt like the traditional route of going to a Big Four accounting firm. There were a lot of companies that disqualified me based on that. I remember talking to the manager at my first job before they hired me. Accounting programs offer the most direct training for a career in bookkeeping.