Running and maintaining all the financial records of a business can be challenging for many business owners. That’s why they reach out to small business bookkeepers to handle all finance management tasks. Many business owners mistakenly think that bookkeeping and payroll are the same, however, this is not true. This raises the question: can bookkeepers manage payroll tasks? In this blog post, we’ll outline both functions and answer your questions, helping you hire a suitable professional for your business.
What are bookkeeping services?
Bookkeeping is the process of managing various financial transactions of a business, from monitoring cash flow and reconciling bank accounts to updating business books and producing financial reports. Although bookkeepers are not the same as payroll professionals or accountants, a bookkeeper may perform some accounting or payroll tasks.
What is included in bookkeeping services?
Bookkeepers ensure the maintenance of a company’s financial position by accurately recording and maintaining financial transactions. Bookkeeping services include several tasks to uphold your financial data. The following are some common bookkeeping services for small businesses:
- Record keeping
- General ledger maintenance
- Financial reports and analysis
- Tax preparation
- Forecasting and budgeting
- Accounts payable and receivable
- Cash flow management
- Bank reconciliation
- Payroll processing
What is payroll processing?
Payroll involves verifying and distributing employee payments at agreed-upon rates and in line with specified award rates. While it may seem simple and suitable for automation, payroll can be quite complex, often requiring the expertise of financial professionals and Human Resources to ensure accurate completion. Payroll processing tasks include:
- Employee onboarding
- Calculating wages
- Filing payroll records
- Distributing paychecks
- Reporting
- Reviewing timesheet
- Superannuation
- Maintain payroll information
- Payroll calculation
- Employee pay slips generation
Does a bookkeeper manage payroll processing?
Yes, many small business bookkeepers handle payroll. Although bookkeeping and payroll are two distinct functions, most bookkeepers also manage payroll operations. Payroll data is a part of the information that bookkeepers use to perform various tasks. It can be beneficial to hire a bookkeeper for both bookkeeping and payroll processing. A professional bookkeeper with a deep understanding of both areas can handle these tasks efficiently. Here are some benefits of letting a bookkeeper manage your payroll:
- For small businesses, seeking help from a bookkeeper for managing payroll can be cost-effective.
- A professional bookkeeper who understands the business finances can ensure accurate record-keeping and financial management, including payroll.
- Furthermore, it streamlines communication when there is a single point of contact for both payroll and bookkeeping queries within the business.
What is the difference between bookkeeping and payroll processing?
While a bookkeeper may handle some payroll tasks, the two roles are different. After discussing each role in depth, let’s examine their differences.
At their core, payroll and bookkeeping differ because they oversee different functions within a company. Bookkeeping involves the day-to-day management of the company’s finances. On the other hand, payroll is the process of managing and paying award rates to employees.
Accounting is also sometimes used interchangeably with payroll and bookkeeping. It is key to understand these differences as well, especially if you are considering hiring an expert to help you with your business finances. Bookkeepers can also work with your accountants in Melbourne when it’s tax time.
Which is the best bookkeeping and payroll software in Australia?
Xero, MYOB, and QuickBooks are among the best software options for bookkeeping and payroll processing. For more information about software suitable for your company, consult your bookkeeper. They understand each feature and functionality of the software and can use it to streamline the bookkeeping and payroll processes. Many bookkeeping software solutions offer integrated payroll services, simplifying both payroll and bookkeeping tasks.
Conclusion
Whether you are an international company or a growing business, handling payroll and bookkeeping yourself can feel overwhelming. Our team of professional bookkeepers understands the distinctions between payroll and bookkeeping and can assist you in determining your business’s needs. Choose our Reliable Bookkeeping Services for accurate payroll and financial management.