Bookkeeping business – StartupSmart

Bookkeeping is a growing profession and, contrary to popular belief, can be exciting and rewarding. Being a bookkeeper is about understanding how a business works and then providing accurate figures in order for the business to know exactly how well it is doing.

 

StartupSmart spoke to the Institute of Certified Bookkeeping to gain more insight into the industry.

 

What is it and who is it suited to?

Bookkeeping involves the recording of financial transactions of a business, whether manually into ledgers or by entering everything onto a computer.

 

If you are well organised and methodical, like working through documents and enjoy seeing a set of figures add up properly, bookkeeping could be the career for you. According to the ICB, people of all ages are becoming bookkeepers.

 

For young people, fresh out of school or university, bookkeeping could be the first step to becoming a qualified accountant.

 

For more mature people, who bring years of experience to their role, bookkeeping can be an ideal way to keep working without having to face the daily grind.

 

Many bookkeepers are mothers wanting to find a well paid career they can run from home whilst bringing up their young family.

 

Rules and regulations

Anyone who is thinking about starting their own bookkeeping business in Australia needs to be aware of the rules regarding BAS Agents, who are eligible to provide Business Activity Statement services for a fee.

 

Any bookkeeper wanting to provide BAS services must be registered as a BAS Agent. To become a registered BAS Agent, a bookkeeper must have 1400 hours of experience and a minimum qualification of a Certificate IV in Bookkeeping or Accounting.

 

Research and competition

ICB executive director Matthew Addison says in addition to the above, bookkeepers should have a sound knowledge of tax law, which changes all the time.

 

“We would therefore recommend that they would need to be keeping in touch with what is happening in their environment, adding to their professionalism through membership of a creditable, relevant, professional association,” Addison says.

 

Costs and earnings

According to Addison, the commencement of a bookkeeping business – from a cost perspective – can happen on several levels.

 

1. According to Addison, anyone who has studied bookkeeping at high school can become a bookkeeper at no cost, although their skills are obviously limited.

 

“It’s possible to obtain work through contacts or word of mouth… If this work is performed at the clients’ premises, then start-up costs could be nil,” Addison says.

 

“Preferably, the person has obtained some software training at least, which – to provide processing skills – would be approximately $400.”

 

2. The most developed and highest level of bookkeeping includes BAS Agent services.

 

“To provide BAS Agent services, a bookkeeper must be registered with the Tax Practitioners Board; a fee of $100 every three years,” Addison says.

 

To be a registered BAS Agent, you must have the following:

• Professional Indemnity Insurance by July 1, with standalone creditable policies starting at $400.
• Qualifications of at least Certificate IV in Bookkeeping or Accounting, which can be obtained for about $1000 to $3,500.
• 15 hours of continuing education every year, costing a minimum of $1,500.

 

To be performing these duties at this level, you are likely to also need the following:

• At least one software company partner program license; $800 to $1400 a year.
• A computer with internet access; $2000 and $50 per month.
• Mobile phone communication; $50 per month.

 

According to Addison, employed bookkeepers at the most basic level earn a minimum of $15 an hour, with most employed bookkeepers earning between $20 and $30 an hour.

 

If you perform reconciliations and/or produce reports, you can expect to earn up to $45 an hour, while BAS Agents and consultant bookkeepers can earn $200 an hour or higher.

 

An average day

According to Addison, an average day as a bookkeeper involves everything from opening envelopes to banking to printing cheques and producing invoices.

 

Useful contacts

Institute of Certified Bookkeepers

1300 856 181

 

Bookkeeping Institute of Australia

1300 729 844

 

Australian Association of Professional Bookkeepers

1300 280 395

 

Australian Bookkeepers Network

07 3290 4914

 

Australian Government Small Business Support Line

1800 777 275