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The ultimate guide to what bookkeepers do and how you should select the right one

We asked Lottie Saunders Bookkeeping “what a bookkeeper actually can do for you”. The answers might surprise you.

image of bookkeeper performing bookkeeping services
Lottie Saunders Bookkeeping

What do bookkeepers and bookkeeping services actually do?


According to the UK Government website a bookkeeper is responsible for a range of financial tasks, which include:

  • Managing sales invoices, income, receipts, and payments

  • Preparing statements to show income and payments

  • Completing VAT returns

  • Verifying the accuracy of accounts

  • Preparing wages and managing expense claims

  • Assisting in the preparation of annual accounts

  • Using computerised accounting systems

  • Handling commercially sensitive and valuable information

A full list of services are detailed in the .GOV site here


“However, these are not the only skills required” Lottie smiles. “A proficient bookkeeper must also possess interpersonal skills, investigation, technology and mindless determination.” for instance:


Value and Check (V&C) Figures with Precision:

“Bookkeepers need to meticulously examine financial data and ensure that all figures, whether they are income, expenses, or tax calculations, are accurate. For instance, when reconciling bank statements, even a small discrepancy in a transaction can have significant consequences, potentially leading to financial errors or misreporting”. A good bookkeeper uses value and check to detect mistakes. “Remember the HRMC use V&C when they perform inspections” Lottie was keen to point out.

image of bookkeeper checking numbers for mistakes using value and check

Be a Detective When Discrepancies Arise:

When the books don't balance, a proficient bookkeeper acts like a detective, seeking out the source of discrepancies. This might involve scrutinising expense receipts, investigating irregularities in financial records, or identifying any unaccounted-for transactions.

image of bookkeeper investigating and looking to resolve financial matters

“Often it can be the accounting platform which has presented a gremlin into the works.” Being able to track down and resolve these discrepancies is crucial to maintaining financial integrity.



Manage Multiple Workloads Efficiently:

“If you can’t work hard your unlikely to succeed as a bookkeeper” Lottie warned. Bookkeepers often handle a multitude of financial tasks simultaneously. They might be managing accounts for multiple clients or overseeing various aspects of a company's finances. Efficient workload management ensures that deadlines are met and all financial operations run smoothly, preventing any backlog or delays. The ability to multitask is imperative as a skill.


Demonstrate Determination When Resolving Issues with HMRC:

Dealing with HMRC (Her Majesty's Revenue and Customs) can be a challenging task, especially when navigating tax-related matters or regulatory compliance. A determined bookkeeper will persistently work to resolve issues, whether it's correcting a tax return or addressing discrepancies in reporting. “I typically hang on the line to HRMC for 30 minutes plus. When most of them know your first name by heart you can tell you have become a competent bookkeeper” Lottie laughed. Bookkeepers have unwavering commitment to ensure that their clients remain in compliance with tax regulations.


Handle Clients' Lack of Responses and Lost Authentication Codes/Passwords Effectively:

“I emailed you last month for that information” Lottie reminiscences over previous calls with clients. However, clients may not always respond promptly to requests for information or clarification. In such cases, a proficient bookkeeper demonstrates patience and effective communication skills, making follow-up reminders and maintaining open lines of communication.

They also know how to navigate lost authentication codes or passwords, ensuring that access to crucial financial systems is re-established swiftly without compromising security.




Good bookkeeping skills is more than numbers

“I recruit bookkeepers who In essence, prove to possess skills that enable them to maintain financial accuracy, troubleshoot discrepancies, manage diverse workloads, interact effectively with government agencies, and adeptly handle various and different challenges that may arise during their duties. Just like a police officer would experience. You never know what type of challenges you will be facing that day”


Time for Action on Late Payments


“They have not paid, but they are our best client” Lottie recalls a common sentence from clients. “We recognise the challenges posed by late payments and actively work to ensure that our clients' invoices are paid promptly. Sometimes denial is something that needs to be faced into.” Bookkeepers should have experienced approaches to recalling bad debt. Sometimes it needs a debt agency to engage with the clients. “We advise you on how to stop debts mounting in the future and also what is worth pursuing or not.” Lottie says

image of HRMC logo showing requirements the government have for bookkeeping



Bookkeeping HMRC and keeping Customs & Excise Happy


“Bookkeepers are supposed to hold you to account in getting everything in on time and filed with HRMC and avoid those pointless penalties. We don’t allow penalties for our clients. The secret is how you communicate with the type of clients that makes the difference. A plumber might need a Oi you said you would send those receipts, whilst a flower shop might need a gentle nudge via email” Bookkeeping services should manage and submit the following for you: -


VAT Returns


“VAT should be kept as low as possible.


Many bookkeepers and accountants just take the word of the accounting package, but you can do so much more” Bookkeepers ensure that your VAT returns are accurate and filed on time, helping you avoid penalties and maintain compliance with tax regulations. But they should also work with the client to reduce the VAT through advising on the expenses of the company. Should a leased car benefit you more than owning your own for instance. “Commonly we have worked out how company directors can lease electric cars through the business for half the cost of owning one” Lottie spoke with a quiet knowing. “More importantly we monitor carefully whether you should be on the flat rate or the normal rate.”


Making Tax Digital

Staying compliant with the Making Tax Digital initiative is essential for modern businesses. We make the


transition to digital tax reporting seamless.

We are MTD approved and setup with the HRMC already.


Construction Industry Scheme (CIS)


For those in the construction industry, bookkeepers should navigate the complexities of the CIS and make sure your tax return and CIS sync perfectly. “CIS and tax returned should always be done together to get the best efficiencies” Lottie reminded me.


Don’t just do Monthly Reports. A bookkeeper will suggest real actions against them


“A monthly report of just numbers is no surprise to a client.

image of bookkeeping services near me

They often know what’s in the bank accounts


. What really needs to come out is helpful advice like things that are missing. For instance, do you have enough corporation tax put by. Have you been saving enough for VAT. Is your profit enough allowing you to pay dividends. Your expenses claimed from your home are too low” The list is endless.


Confirmation Statements


Bookkeepers assist in the preparation and filing of confirmation statements to ensure your business remains in good standing with Companies House. Don’t let a £18 submission turn into a £100 penalty.


Anti-Money Laundering (AML) Guidance Updated

image of legal laws for bookkeepers to keep to concerning anti money laundering AML

Bookkeepers stay updated with the latest regulations and ensure their clients are fully compliant with anti-money laundering regulations.


Anti-Money Laundering (AML) obligations for bookkeepers involve several key responsibilities to prevent money laundering and the financing of illegal activities. Accountants are required to:


Customer Due Diligence (CDD)

Conduct thorough checks on clients to verify their identities and assess the nature of their business relationships.


Record-Keeping

Maintain detailed records of client transactions and identity verification documents, which must be retained for a specified period.

image of bookkeeping services detailing VAT returns MTD making tax digital CIS construction industry monthly reports

Suspicious Activity Reporting

Actively monitor client accounts for unusual or suspicious transactions and report such activities to the relevant authorities.


Risk Assessment

Evaluate and manage the money laundering and terrorist financing risks associated with clients and business activities.


Employee Training

Ensure that employees are educated about AML regulations and how to recognize and report suspicious activities.


Compliance Program

Establish and maintain an AML compliance program to meet legal requirements.


Regulatory Reporting

Cooperate with regulatory authorities, including providing information and documentation when requested for AML investigations.


Ongoing Monitoring

Continuously monitor client accounts and update risk assessments as necessary.


Types of business requiring booking and booking services

Good Bookkeepers have expert skills to serve a diverse range of clients, including:


Small and Medium Businesses

Running a small or medium-sized business comes with its own set of financial challenges. Our bookkeeping services are tailored to meet the specific needs of your business, ensuring your financial records are accurate and up to date.


Sole Traders

As a sole trader, you need a bookkeeper who understands the intricacies of managing your personal finances alongside your business income. Our services cater to sole traders, providing comprehensive support to help you manage your finances effectively.


Accountants

Accountants rely on accurate financial data to provide quality services to their clients. Our bookkeeping services ensure that accountants have access to reliable financial information to make informed decisions.


Franchisees and Franchisors

Franchise businesses often have unique financial requirements. Lottie Bookkeeping specialises in working with franchisees and franchisors to ensure their financial records are in perfect order.




Letting Agents

Managing rental properties involves numerous financial transactions. We assist letting agents in maintaining clear financial records, making their job easier and more efficient.


Online Retailers

The world of e-commerce requires meticulous financial management. Lottie Bookkeeping uses various software’s that makes reporting easy. We are providers of Pixie


UK and international spread businesses

“Businesses spread globally need pulling together in both a technology sense and a standardisation in how expenses and purchases are categorised. You tend to learn how to connect many Xero’s together so a client can have an aggregated reporting method.”


New trend business start-ups

“Cannabis oil start-ups are on the rise during 2023.

bookkeeping for business startups

Keeping them legal and proving they are legal to the FCA is a significant task. You must watch these trends and be ready for them when they arrive” Lottie explains.



What should you look for when selecting a bookkeeper or bookkeeping services?


When selecting a bookkeeper, it's crucial to consider the following factors:


They should be ICB Accredited

Bookkeepers accreditation from the ICB

Ensure your bookkeeper is listed in the ICB (Institute of Certified Bookkeepers) accredited professionals' directory, demonstrating their commitment to industry standards. Several institutes and regulatory boards exist but the ICB is the one that is the best.


Demonstrate accounting software expertise

“Verify that your bookkeeper has the necessary skills to resolve problems

Lottie Saunders Xero bronze partnership accreditation

with your accounting software, making your financial management more efficient. Look for bookkeepers that have partnerships with software’s giving them access to enhanced support. For instance, we have a bronze Xero partner accreditation which gives us speedy support from Xero themselves. “


Bookkeeping should use AI

“You need to be able to pull upon a host of AI accountancy technologies. For instance, Xero has AI product features like Analytics Plus giving us access to deep insights on our clients’ books.” Bookkeeping AI reconciliation predictions can be powered by machine learning and can classify transactions that don't match up to invoices or bank rules. “We also leverage cutting-edge technology and AI to enhance our bookkeeping services.” Lottie boasts. “This allows us to streamline processes, improve accuracy, and provide our clients with the most efficient financial solutions.”


Cost-Effective Solutions


image of bookkeeper supplying cost effective accounting software

Look for bookkeepers who provide cost-effective licensing options for accounting software to help you save money. We provide Xero and Dext at a reduced cost for instance” Lottie explains.


Make sure your bookkeeper is not a criminal.

As per Regulation 26 of the Money Laundering Regulations 2017, external Bookkeepers and Beneficial Owners, Managers and Officers of a Bookkeeping Practice must not have any unspent Schedule 3 criminal convictions relating to fraud and dishonesty. If your bookkeeper has criminal convictions on fraud and dishonesty then any submissions made to HRMC or companies house are invalid


Your bookkeeper must be able to hold secrets

Vital to the role a bookkeeper, must be the ability to handle commercially sensitive and valuable information.


And the most important. Bookkeepers should save you money!

“It just blows me away that accountants and bookkeepers don’t

image of bookkeeper saving a client money

actively work to save the client money. I think it’s just laziness. I’ve always felt that my client should see savings four times more than my fee” Lottie explains.


Why Choose Lottie Bookkeeping for your Bookkeeper and Bookkeeping Services?


Picture of Lottie Saunders bookkeeping logo

When it comes to managing your finances, having a reliable and professional bookkeeper is essential. That's where Lottie Bookkeeping and our expert bookkeeping services come into play. We understand the intricate details of financial management and are committed to helping you achieve better results. Whether you're a small business owner, a sole trader, an accountant, a franchisee, a letting agent, or an online retailer, we have the expertise to assist you and save you money.


Find your nearest Lottie Saunders Bookkeeping office below


Locations for Lottie bookkeeping services


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