(redirected from bookkeepers)
Also found in: Dictionary, Thesaurus, Legal, Financial.


maintenance of systematic and convenient records of money transactions in order to show the condition of a business enterprise. The essential purpose of bookkeeping is to reveal the amounts and sources of the losses and profits for any given period. Proper bookkeeping should also reveal the nature and value of the assets and liabilities of a firm, as well as its net worth at the close of that period.

Bookkeeping records are kept in columnar form, using separate columns for the date of transaction, an explanation of the nature of the transaction, and its value. Other columns may be added. In general, two sets of columns are used, assets being placed in one set of columns and liabilities in the other set (a money value having been assigned to all assets and all liabilities of the business). Such an arrangement is called double entry. A balance sheet may be compiled at any time by totaling each column and subtracting the smaller total from the greater to give either a surplus or a deficit. The result is called the net worth, and it gives an indication of the financial state of a firm. A detailed balance for a period between two balance sheets is called a profit and loss statement.

The process of deciding whether to enter items into one set of columns or the other, i.e., into the debit side or the credit side, is called journalizing, since the analyzed items are placed in a journal, or daybook, soon after the transactions occur. Separate accounts of persons or sections are kept in a book called a ledger; the ledger is now often a computer file (created in "spreadsheet" software) rather than a physical book. The transfer of items from the journal to the ledger is called posting. In large businesses, the journal is broken into many sections, each concerning a separate function of the business, such as sales, purchases, accounts receivable, accounts payable, sales return, purchases return, and cash on hand. The journal also has sections for invoices, inventory, orders, cash, sales, bills, and checks.

Single-entry bookkeeping enters all debits and credits in a single set of columns in a journal and labels each entry Dr. (debit) or Cr. (credit). Thus in a single entry only one element of a transaction is entered. Single-entry bookkeeping fails to give detailed information as to the sources of gain or loss.

There are two main methods of accounting for money in a business. The cash method reports income in the year it is received and deducts expenses in the year they are paid. The accrual method reports income when it is earned and deducts expenses as they are incurred, regardless of whether the money has actually entered or left the business yet.

Any bookkeeping system must also account for all canceled checks, paid bills, duplicate deposit slips from banks, and other records of transactions. These records act as proof of the posted entries; they are usually organized chronologically or by type and are kept in filing cabinets. Bookkeeping machines, ranging from the simple adding machine to the computercomputer,
device capable of performing a series of arithmetic or logical operations. A computer is distinguished from a calculating machine, such as an electronic calculator, by being able to store a computer program (so that it can repeat its operations and make logical
..... Click the link for more information.
, help in maintaining properly organized books. Computers revolutionized bookkeeping and accounting systems, both for entering ledger items and for such operations as year-end profit-and-loss calculations.

The Babylonians, Egyptians, Greeks, and Romans kept business records. Double entry seems to have been first developed by the people of N Italy during the great commercial expansion of the 14th and 15th cents. and has consequently been called the Italian method. The system then spread to the Netherlands, England, and elsewhere. Single entry developed later.

See also accountingaccounting,
classification, analysis, and interpretation of the financial, or bookkeeping, records of an enterprise. The professional who supplies such services is known as an accountant. Auditing is an important branch of accounting.
..... Click the link for more information.
; auditingauditing,
examination and statement of accounts and of other documents connected with accounts by persons who have had no part in their preparation. Systems of financial inspection have long been used, especially in connection with public accounts.
..... Click the link for more information.

References in periodicals archive ?
Pamela is an IRS Enrolled Agent, Certified Bookkeeper and Quickbooks Pro-Advisor.
To gain registered status, bookkeepers must have achieved a level three IAB qualification or equivalent from another awarding body - the highest available - have at least two years' relevant bookkeeping experience and have either a computerised bookkeeping qualification or can demonstrate at least a year's experience of computerised bookkeeping.
Xero's Head of Accounting Grant Anderson said : "Practice Manager equips accountants and bookkeepers with the tools that free them up from time-consuming administrative tasks, allowing them to focus on the important advisory role and adding real value to their small business clients.
Accountants and bookkeepers constantly provide us with great feedback about the time savings they enjoy and appreciate the convenience of the cloud statutory report lodgement service.
Team Valley-based Access Training is offering a Level 2 Certificate in Bookkeeping after the National Apprenticeship Service reported local firms were finding it difficult to recruit and train suitable bookkeepers.
Report author, Brett Warfield, says: "Most bookkeepers are honest, diligent and perform their work ethically.
Bookkeepers work in both large and small companies, in almost all industries, as well as in government, education and healthcare.
Members receive strong ongoing support from a team of qualified professionals, access to free legal and technical advice, regular opportunities to meet other bookkeepers and to update their skills through continuing professional development seminars.
Before you can verify the accounting data that is presented to you, you must do a thorough background check of the bookkeeper you hire.
Mainstream's founders, John Burgess and Mark McClelland, who started the company on a few hundred incorporation dollars and a copy of QuickBooks, needed a trained bookkeeper to look after their increasingly complex finances.
Again, the work of The Captives' annotator coincides with revisions in the marked-up copy of The Two Merry Milkmaids; each new act in the quarto is marked by the bookkeepers, who have even added anticipatory directions for the act breaks.
After many years in the subscription newsletter industry, award-winning copywriter Steve Sahlein and publishing executive Stan Hartman formed a partnership in 1987 to create The American Institute of Professional Bookkeepers (AIPB).