WHAT IS BOOKKEEPING? DEFINITION AND EXPLANATION

Updated: Aug 7



What is bookkeeping?


Like accounting, keeping a company's books and preparing its financial statements and tax reports are all part of bookkeeping.


However, many people see bookkeeping as limited to recording transactions in journals or daybooks, then the accountant will adjust entries and prepare the financial statements and other reports.


At the larger Corporations, “bookkeeping” might be absent. There will be accounting departments staffed with accounting clerks who process accounts payable, accounts receivable, payroll, etc. The accounting clerks will be supervised by one or more accountants.

In small business world, Bookkeeper is the one who is recording, storing and retrieving financial transactions for a company.


There also are Bookkeeper who assists the nonprofit organizations, and individuals for their set of financial records.

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Recording long-term Debts for your business





What does a bookkeeper do?


Small business & Mid-size business Bookkeeper involves many common financial transactions and tasks as below:

  • Billing for goods sold or services provided to clients.

  • Recording receipts from customers.

  • Verifying and recording invoices from suppliers.

  • Processing employees' pay and related governmental reports.

  • Monitoring individual accounts receivable.

  • Recording depreciation.

  • Adjusting entries.

Today bookkeeping is done with the use of computer software. For example, QuickBooks (from Intuit) is a low-cost bookkeeping and accounting software package that is widely used by small businesses and Mid-size businesses in the U.S.

Bookkeeping requires knowledge of GAAP to understand debits and credits, understanding of financial accounting, and capability to prepare the balance sheets and income statements.

Irvine Bookkeeping is a specialized bookkeeping and tax company that has a team of bookkeepers and tax preparers that lead by Bookkeeping Partner, Tammy and Tax Partner, David. We are here to assist you with your bookkeeping and tax matters. As always, we are your local Irvine, CA Bookkeeping and Tax Services Provider.


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