Training in Bookkeeping – How to Be Successful
Here, you’ll learn the nine things you need to know about training in bookkeeping that’ll help you succeed in your career and business.
In this article:
- Essential Numerical Skills
- How to Maintain Business Financial Transactions
- Bank Reconciliations
- Single- and Double-Entry Systems
- Manage the Business’ Budget, Cash Flow, and Inventory
- How to Deal with Suppliers, Customers, and Debts
- Sales Tax and Value-Added Tax
- How to Create, Analyze, and Read Financial Reports
- Bookkeeping Courses on Accounting and Bookkeeping Software
Training in Bookkeeping: Skills and Knowledge You Can Gain From Them to Help You Succeed
1. Essential Numerical Skills
As a bookkeeper, you’ll have to deal with financial transactions and numbers. You need the ability and confidence to perform basic math, such as:
- Use of decimals and percentages
Knowing the basics is great, but it’s still essential that you refresh your memory on mathematical skills that’ll come in handy for your role. That’s why you need bookkeeping courses that’ll equip you well in this area.
Aside from re-learning basic math, you also need to enhance your mental calculation. Being able to accurately calculate in your head can save you time in performing your tasks.
How to use a calculator properly is also something you should learn. This way, you can effectively use it for your work and maximize the different functions it offers.
2. How to Maintain Business Financial Transactions
A bookkeeper’s role mainly revolves around keeping accurate records of a business’ financial transactions. The good thing is, you can learn how to do this even through online bookkeeping courses.
It’s essential that you learn how to document and maintain accurate records in two types of journals:
- Cash sales journal — Where you record the business’ revenues
- Cash disbursements journal — Where you record the expenses the business paid for
Keeping the business’ journals up-to-date will allow the management to stay on top of their financial situation. The journal records will tell them if their business is in a healthy state or not.
Knowing their revenue and expenses will also allow the business owner to diversify their assets. It’ll point them to the right investments and ventures where they can be more productive.
3. Bank Reconciliations
Facilitating banking transactions is another task a bookkeeper undertakes. Bookkeeping courses will teach you how to carry out basic banking transactions.
More importantly, you need to learn how to balance the business’ financial books by reconciling them with bank statements. This means aligning journal entries with the bank statements.
4. Single- and Double-Entry Systems
Single-entry system and double-entry system are the two main types of bookkeeping. Learning both will come in handy, as they’re used in different situations.
Sole proprietors and startup companies often use the single-entry system. This is the ideal bookkeeping type for businesses with minimal and uncomplicated financial transactions.
It’s the best system to apply if the business runs on the cash basis of accounting.
What is the cash basis of accounting? This means recording the cash sales and the expenses the business pays for upon incurring them.
Businesses with more complex transactions like accrued expenses use the double-entry system. It’s more flexible than the single-entry system, as you can use it both for the accrual basis and the cash basis of accounting.
What is the accrual basis of accounting? This means recording transactions into the bookkeeping system upon earning or purchasing them, not when the business receives the cash or pays for the expense.
It’s also important to learn how to prepare a trial balance, where you declare all the credits and debits in a double-entry account book.
5. Manage the Business’s Budget, Cash Flow, and Inventory
Aside from maintaining the financial books, bookkeepers also help manage the business’s money and inventory.
This includes the annual budget and even the petty cash fund, as businesses need a dedicated person to oversee how they’re utilized. Bookkeepers also oversee the company’s cash flow as they record all the daily financial transactions it undertakes.
This is why it’s important for bookkeepers to know how to calculate variances in the budget and communicate any issues with the management. This will allow the business owner to see where they’re overspending or underspending.
Bookkeeping courses will get you acquainted with these tasks. Learning even just the basics will help you do your job with more confidence later on.
RELATED: Starting a Bookkeeping Business
6. How to Deal with Suppliers, Customers, and Debts
Numbers aren’t the only things you’ll deal with as a bookkeeper. You will also encounter suppliers and customers, and manage debts.
As mentioned earlier, one of the bookkeeper’s tasks is managing a business’s inventory. For this, you’ll have to deal with suppliers and make sure they’re paid accordingly.
This also includes ensuring that there’s enough supply for the customers’ demand, and that they pay for their purchases accordingly.
Some businesses may also need help in managing debt levels and ensuring that all parties comply with the debt covenant. To keep the business in good shape, they should be able to collect receivables promptly and settle their payables on time.
The thought of handling all these may sound overwhelming, but that’s precisely why it’s important to learn from a bookkeeping course that can teach you all these.
7. Sales Tax
As early as now, you need to be familiar with the processes of the Internal Revenue Service (IRS). Your bookkeeping system, as well as the company’s financial transactions, should always comply with IRS standards.
If your client deals with both customers and suppliers you’ll need to handle:
- Sales Tax — This is what a business collects from the end consumer. Each product has a corresponding sales tax added to its price, which the customers pay.
Businesses remit the sales tax to the state in which they were collected.
8. How to Create, Analyze, and Read Financial Reports
As bookkeepers keep track of the business’s financial transactions, they’re also expected to generate reports with analyses out of it. The most basic ones you need to be familiar with are the Balance Sheet and Income Statement.
Remember that in creating these financial reports, there are two main things you have to follow:
- Standard accounting procedures and policies
- Compliance with the government’s reporting requirements
Through the reports that bookkeepers generate, they can communicate the accurate financial status of the company. This includes both the gains and losses that the management needs to be aware of.
Accountants and auditors also rely on bookkeepers to do their job well so they can give the right recommendations and audit.
Most of the training in bookkeeping we’ve reviewed does a poor job here. Make sure that whichever training provider you go with spends time on how to create, analyze and read financial reports.
9. Training in Bookkeeping: Accounting and Bookkeeping Software
You have the choice to apply either manual or computerized bookkeeping, but they work best when used together. That’s why it’s essential that you take bookkeeping courses on the software of your choice.
Using an accounting or bookkeeping software will help you maintain the accuracy of your financial records. Plus, since it’s automated, you can accomplish your work more efficiently.
Some of the popular software you can opt to learn are Excel, QuickBooks®, Sage Accounting, and Xero. In choosing a software, you have to consider the following:
- What features they offer
- How often you’ll use the software
- How easy or complicated it is to learn
Software training may come with the bookkeeping course you’ll take, but you can also take them separately. If you’ve already invested in a specific bookkeeping or accounting software, check to see if you have free access to their tutorials and training videos.
This way, you can learn directly from the developer and gain insights you may not get from outside sources.
How Bookkeeper Launch Can Help You
Starting your own virtual bookkeeping business may sound daunting, but you can do it with the help of Bookkeeper Launch. It’s the best training in bookkeeping course online that goes beyond just the basics.
With the step-by-step blueprint of Bookkeeper Launch, you’ll learn:
- Up-to-date bookkeeping skills
- Efficient bookkeeping systems
- How to market to attract high-quality clients
It’ll teach you not only how to become a bookkeeper, but also how you can start a virtual bookkeeping business.
With Bookkeeper Launch, you can gain the 3F Lifestyle where you can enjoy your freedom, family, and finances all at the same time.
Bookkeeping is a great career that anyone can learn through the proper training in bookkeeping. Take the first step by taking a bookkeeping course online that’ll equip you in the best way.
By doing this, you’ll learn what you need to succeed in the path you will take. When you know what you want to gain out of a course, you can make the best choice to jump-start your career.
What do you want to learn the most from your training in bookkeeping? We’d love to hear from you in the comments section below.