What Is Bookkeeping? Duties, Pay, and How to Become a Bookkeeper

Bookkeepers manage a company’s financial accounts, ensuring they are accurate and easy to review. Their work plays an important role in the operation of a successful business, which can have very many transactions in a single day, let alone a week, month, fiscal quarter, or year.

If you're a detail-oriented individual who enjoys working with numbers, then you might consider a career as a bookkeeper.

In this article, you'll learn more about what bookkeepers do, why they’re important to a business, and how much they earn. You'll also explore how to become one and find suggested cost-effective courses that can help you gain job-relevant skills today.

If you're ready to build job-ready skills in bookkeeping, consider enrolling in the Intuit Academy Bookkeeping Professional Certificate.

What is bookkeeping?

Bookkeeping is the process of keeping track of a business’s financial transactions. These services include recording what money comes into and flows out of a business, such as payments from customers and payments made to vendors. While bookkeepers used to keep track of this information in physical books, much of the process is now done on digital software. 

Bookkeepers are needed in just about every industry and business, both large and small. 

Did you know?

Bookkeeping as a profession dates back to the 15th century when Italian mathematician Frater Luca Pacioli—the father of modern bookkeeping—detailed many accounting systems and tools still used today, including double-entry bookkeeping.

Types of bookkeeping

There are several types of bookkeeping that bookkeepers perform. Two of the most common are single-entry bookkeeping and double-entry bookkeeping.

Single-entry bookkeeping records all transactions in just one row. Typically, single entry bookkeeping is suitable for keeping track of cash, taxable income, and tax deductible expenses.

Double-entry bookkeeping records all transactions twice, usually a debit and a credit entry. Typically, double-entry bookkeeping uses accrual accounting for liabilities, equities, assets, expenses and revenue.

While single-entry bookkeeping is simpler, double-entry is more thorough and less likely to produce errors.

Bookkeeper vs. accountant: What’s the difference?

Both accountants and bookkeepers work to maintain accurate records of finances, and sometimes the terms are used interchangeably. Generally, bookkeepers focus on administrative tasks, such as completing payroll and recording incoming and outgoing finances. Accountants help businesses understand the bigger picture of their financial situation. 

An accountant can certainly perform bookkeeping tasks, but the title generally involves other responsibilities as well. An accountant may interpret the financial records that a bookkeeper compiles, in order to assess a company’s financial health. They may also perform audits and prepare tax returns. Becoming an accountant usually requires more training and education than bookkeeping and can be a good next step in your financial career.

What does a bookkeeper do?

The work of a bookkeeper may vary depending on the needs of the business. You may work at a large company, small business, or as a freelancer. Here are some other tasks you may handle as part of this job:

• Record transactions using accounting software, spreadsheets, and databases

• Collect and organize financial records, cash flow statements, bank documents, and loss statements

• Generate invoices and receive payments from customers

• Track debits and credits for various accounts

• Reconcile financial statements

• Create balance sheets and income statements

• Review reports for accuracy

• Complete payroll

• File business tax returns

Read more: A Guide to Bookkeeping: Skills, Salaries, and Careers

Watch this video for insights into how credits and debits work.

Bookkeeper salary

Bookkeepers make an about average salary. According to the US Bureau of Labor Statistics (BLS), the median salary for bookkeepers in the US is $45,860 per year as of 2021 [1]. You can sometimes choose between full-time and part-time positions, and you may go to work in an office or work from home.

How to become a bookkeeper

If you're organized and enjoy working with numbers, a job as a bookkeeper could be a good fit. Here’s what you can do to gain the skills necessary to get started.

1. Take a bookkeeping course. 

A bookkeeping course can teach you the basic knowledge you’ll need to prepare financial reports, organize data using tools like Microsoft Excel, or understand how to balance books. 

Some courses can also earn you a credential from an industry leader for your resume—like the Intuit Bookkeeping Professional Certificate on Coursera. 

While it’s not always necessary to have a degree, some companies will look for candidates with coursework in accounting.

2. Get a bookkeeping certification. 

Certifications aren’t necessary to become a bookkeeper but can signal to employers that you have the training and knowledge to meet industry standards. After you have a few years of experience, you can earn the Certified Bookkeeper designation from the American Institute of Professional Bookkeepers by passing a series of exams.

3. Build essential bookkeeping skills.

As you take courses and pursue a certification in bookkeeping, be sure to acquire skills that are essential for your bookkeeping career, as explored below:

Technical skills:

• Debits and credits

• Invoicing 

• Billing 

• Vendor relations

• Accounts payable 

• Accounts receivable 

• Data entry

• Spreadsheets

• Payroll 

• Financial statements

• Bank reconciliation

• Accounting software 

Here's an example of how you'd enter a transaction in the Intuit software.

Workplace skills:

• Organization

• Communication

• Time management 

• Attention to detail 

• Error correction 

• Decision making 

• Critical thinking 

• Interpersonal skills 

Read more: What Are Technical Skills?

4. Consider earning a degree. 

Though having a two-year or four-year degree isn’t always required to be hired as a bookkeeper, some companies may prefer candidates who do. 

An associate or bachelor’s degree in bookkeeping or related fields like finance, accounting, or business can teach you about the broader industry, enhance your potential earnings, and boost your competitiveness for jobs. A degree can also help you make the leap from being a bookkeeper to being an accountant or other business-oriented role.

Read more: 10 Ways to Enhance Your Resume

Explore bookkeeping with Coursera

Bookkeepers are integral to ensuring that businesses keep their finances organized. If you're interested in a career as a bookkeeper, consider taking a cost-effective, flexible course through Coursera. In Intuit's Bookkeeping Professional Certificate, you'll learn bookkeeping and accounting fundamentals, including asset types, liability, equity, and financial statement analysis, and gain hands-on practice with real-world scenarios. At the end of the course, you'll receive a professional certificate, which you can put on your resume to demonstrate your skills and accomplishments to potential employers.