What duties do you consider ‘bookkeeping’?

Defining the Scope of Bookkeeping Responsibilities

For the past three years, I’ve been operating as an independent Bookkeeping contractor, and I’ve noticed that companies are increasingly entrusting me with additional tasks. I take this as a positive indication of their confidence in my abilities.

This development has led me to ponder the boundaries between the responsibilities of a bookkeeper and those of a general manager or executive. For instance, when it comes to budgeting, should a bookkeeper be responsible for constructing and managing a client’s entire operational budget? Additionally, what is the extent of involvement in managing accounts payable, such as processing payments and maintaining records? I’m aware that it’s not ideal for the same person to handle both Bookkeeping and payment processing, which is why I’m trying to redefine my role.

I’d love to hear your thoughts on this topic, as there can often be a lot of grey areas in these roles.

By the way, for context, I specialize in the non-profit sector in Canada.
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Being an independent Bookkeeping contractor, especially in the non-profit sector in Canada, presents unique challenges and opportunities. As you’ve observed, your role may start to overlap with tasks typically expected of general managers or executives. Understanding the core duties of Bookkeeping can help delineate where your responsibilities should ideally end. Below are detailed Bookkeeping duties, potential expansions into related roles, and best practices:

Core Bookkeeping Duties

Recording Financial Transactions:
Maintain an accurate record of financial transactions using Accounting Software.
Classify transactions by assigning them to appropriate accounts.
Managing Accounts Receivable and Accounts Payable:
Track invoices and payments for accounts receivable.
Process vendor and supplier invoices, ensuring timely payments as per terms.
Reconcile customer and vendor accounts.
Bank Reconciliations:
Regularly reconcile bank accounts to ensure that records are accurate.
Investigate and resolve discrepancies between bank statements and the company’s financial records.
Maintaining the General Ledger:
Keep the ledger up-to-date with all financial transactions.
Verify and allocate account codes.
Financial Reporting:
Prepare financial statements such as balance sheets, income statements, and cash flow statements.
Generate reports for management or board meetings.
Compliance and Tax Preparation Support:
Ensure compliance with Canadian tax laws and regulations.
Assist in preparing documents for tax filings.

Potential Expanded Duties (Beyond Core Bookkeeping)

Budgeting:
Typical Expectation: Bookkeepers generally track and report budget versus actual figures, but do not typically create an operational budget from scratch.
Possible Extension: Collaborate with management to provide data necessary for building budgets, offering insights from transaction history.
Strategic Financial Management:
Typical Expectation: Bookkeepers provide the data needed for strategic decision-making but do not usually partake in strategic planning or high-level oversight.
Possible Extension: When trusted by the management, you could offer financial analysis or insights based on trends.
Accounts Payable Operations:
Typical Expectation: Manage the AP function to ensure accuracy, but not engage in approving or processing payments beyond recording them.
Best Practice Move: Segregate duties by recommending that payment approvals/processing be handled by a different individual or department.

One response

APAdmin

25 February 2025 at 7:33 PM
Being an independent Bookkeeping contractor, especially in the non-profit sector in Canada, presents unique challenges and opportunities. As you’ve observed, your role may start to overlap with tasks typically expected of general managers or executives. Understanding the core duties of Bookkeeping can help delineate where your responsibilities should ideally end. Below are detailed Bookkeeping duties, potential expansions into related roles, and best practices:

Core Bookkeeping Duties
1. Recording Financial Transactions:
2. Maintain an accurate record of financial transactions using Accounting Software.
3. Classify transactions by assigning them to appropriate accounts.
4. Managing Accounts Receivable and Accounts Payable:
5. Track invoices and payments for accounts receivable.
6. Process vendor and supplier invoices, ensuring timely payments as per terms.
7. Reconcile customer and vendor accounts.
8. Bank Reconciliations:
9. Regularly reconcile bank accounts to ensure that records are accurate.
10. Investigate and resolve discrepancies between bank statements and the company’s financial records.
11. Maintaining the General Ledger:
12. Keep the ledger up-to-date with all financial transactions.
13. Verify and allocate account codes.
14. Financial Reporting:
15. Prepare financial statements such as balance sheets, income statements, and cash flow statements.
16. Generate reports for management or board meetings.
17. Compliance and Tax Preparation Support:
18. Ensure compliance with Canadian tax laws and regulations.
19. Assist in preparing documents for tax filings.
Potential Expanded Duties (Beyond Core Bookkeeping)
1. Budgeting:
2. Typical Expectation: Bookkeepers generally track and report budget versus actual figures, but do not typically create an operational budget from scratch.
3. Possible Extension: Collaborate with management to provide data necessary for building budgets, offering insights from transaction history.
4. Strategic Financial Management:
5. Typical Expectation: Bookkeepers provide the data needed for strategic decision-making but do not usually partake in strategic planning or high-level oversight.
6. Possible Extension: When trusted by the management, you could offer financial analysis or insights based on trends.
7. Accounts Payable Operations:
8. Typical Expectation: Manage the AP function to ensure accuracy, but not engage in approving or processing payments beyond recording them.
9. Best Practice Move: Segregate duties by recommending that payment approvals/processing be handled by a different individual or department.
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Defining the Scope of Bookkeeping Responsibilities

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