What Does a Bookkeeper Actually Do? (Explained Simply)

In the world of business, bookkeeping is a vital function that ensures financial accuracy and compliance. Bookkeeping is a core function that keeps your financials accurate, organised, and compliant with the ATO. But what does a bookkeeper actually do day to day? Let’s break it down in simple terms.

Key Responsibilities of a Bookkeeper

Here are some of the primary tasks that bookkeepers handle:

  • Recording Transactions - Bookkeepers meticulously record all financial transactions in the appropriate ledgers, ensuring that every dollar is accounted for.
  • Managing Accounts Payable and Receivable - They track what the business owes to suppliers and what customers owe to the business, ensuring timely payments and collections.
  • Reconciling Bank Statements - Bookkeepers regularly compare the company’s financial records with bank statements to identify discrepancies and ensure accuracy.
  • Preparing Financial Reports - They generate reports such as profit and loss statements, balance sheets, and cash flow statements, which provide insights into the business's financial performance.
  • Assisting with Tax Preparation - Bookkeepers help prepare the necessary documentation for tax filings, ensuring that all financial information is accurate and up-to-date.

In addition to these tasks, bookkeepers often play a crucial role in budgeting and forecasting, helping businesses plan for the future by analyzing past financial data.

Bookkeeper vs. Accountant: What’s the Difference?

Many business owners often mix these two roles up. While both work together closely, they focus on different parts of your financial world.

Bookkeeper

  • Handles daily financial record keeping
  • Manages invoices, payments, and reconciliations
  • Prepares regular financial reports
  • Supports BAS and GST requirements
  • Maintains accurate and organised accounts

Accountant

  • Analyses financial data and provides advice
  • Lodges tax returns and offers tax planning
  • Advises on business structure and compliance
    Performs audits
  • Helps with long term financial strategy

In simple terms: A bookkeeper organises your financial information while an accountant uses that information to provide advice and make decisions.

Signs You Need a Bookkeeper

Not sure if you need one? Here are common indicators:

  • You’re behind on BAS or GST lodgements
  • Your bank accounts don’t match what’s in your software
  • You’re spending hours each week on admin
  • Cash flow feels unpredictable
  • You’re unsure whether you’re making a profit
  • You avoid looking at your financials because they feel overwhelming

If any of these feel familiar, bringing in a bookkeeper can save you time, stress, and money.

Final Thought

Bookkeeping gives business owners the clarity, control, and confidence they need to make smart financial decisions and stay focused on growth. When your books are accurate and up to date, planning ahead, managing cash flow, and understanding your financial position becomes significantly easier.

If you’d like to deepen your understanding of bookkeeping, we’ve created a free checklist covering the key tasks every business should stay on top of each month. To get your copy just send us a message through our Contact page and mention “Free Bookkeeping Checklist.”