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Bookkeeper and Bookkeeping
Definitions, Meaning Explained, Usage

The bookkeeper's role in the accounting cycle starts when transactions are entered in a journal or daybook. Bookkeepers may also serve as the accounting system interface with employees and customers.

What is a bookkeeper and what is bookkeeping?

Business people with the job title Bookkeeper may perform a very wide range of clerical and administrative tasks, but the central activity associated with bookkeeping is, literally, "keeping the books," especially the journals and ledgers that record all of the organization's financial transactions.


What is the bookkeeper's role in the accounting cycle?

When an employee turns in an expense receipt, when a customer is invoiced, when a vendor is paid, or when any other transaction occurs, it is the bookkeeper's responsibility to enter the transaction first in a journal and then, later to see that journal entries are posted to a ledger. These activities in fact are the initial steps in the accounting cycle . At the end of each accounting period, the cycle is typically completed by accountants, who use the ledger entries to create trial balances, correct errors, and produce the period's financial statements such as the Income statement and Balance sheet.

In addition to recording transactions, bookkeepers often serve as the point of contact between the organization and customers or venders, who actually makes the transaction. Bookkeepers, for instance, may calculate, prepare, and distribute employee paychecks or payments to vendors. They may be responsible for calculating, preparing, and sending invoices to customers. They may be responsible for other activities, such as reconciling the organization's bank statements, determining when customer payments are overdue and starting collection procedures, or determining which level of management approval is required for specific payments.

What are the education and skll requirements for bookkeepers?

Skill requirements for the bookkeeper include a good command of double entry bookkeeping and a thorough familiarity with the organization's chart of accounts. This is because, under the double entry system, every financial event requires two bookkeeping entries, one a debit to one account, and the other an equal, offsetting credit to another account. Moreover, in almost all organizations now, the bookkeeper's "books" are actually software applications, parts of the organization's accounting/bookkeeping system. Thus, fundamental skills required for working as a bookkeeper also include the ability to use bookkeeping software and other office applications such as spreadsheets and word processors.

Bookkeeping normally does not require a four-year college degree, but most positions typically do require a high school diploma and some post-high school training in basic business knowledge and bookkeeping skills.

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