The bookkeeping industry has been around for a very long time. In fact, the oldest record of double-entry bookkeeping that has been discovered was in 1340, with it becoming common practice by the end of the 15th century.
So with this very long history, what has changed?
In the latter part of last century, we moved from keeping financial records in actual paper books and ledgers to using computer software. This was an amazing advance which allowed both accounting professionals and business owners to be more efficient and have a range of tools and reporting at their disposal.
And then a few years ago, the law was passed in Australia requiring all paid services relating to BAS preparation could only be done by a registered BAS Agent. This was effectively the majority of work that a bookkeeper does.
This was actually a very good change for our bookkeeping industry. It meant that the quality of work of a bookkeeper was a lot more reliable. Prior to this regulation, anyone could call themselves a “bookkeeper” whether they had a qualification or not and the industry had become riddled with those who were just not up to the task.
I’m sure every bookkeeper and business owner knows of someone who had contracted a sub-standard bookkeeper leaving a big, costly mess that had to be fixed up. The strict requirements of BAS Agent registration meant that those who didn’t have the experience and the skills were no longer able to do the work.
Around the same time, another major change was happening in the industry and also the greater business world. This was “the cloud”.
With the advent of a whole new range of software-as-a-service providers, the game began to change.
Businesses started to see the value of the cloud. There was more ability for collaboration. More transparency. And less cost of infrastructure, not requiring high cost local software and servers. And also savings in resources with personnel being able to work from varied locations globally.
In regards to the bookkeeping, the cloud has really brought massive changes to the industry as a whole.
No longer is there numerous data files going between business, bookkeeper and accountant. Just one set of accounts, real-time and up to date where all those working on the accounts can work as a team and collaborate.
The old-style bookkeeper who jealously guards “their books” is quickly coming to realise that business owners are looking elsewhere. They are looking towards bookkeepers and accounting professionals who take on a trusted advisor role in their business, becoming part of their team rather than simply an expense to their business.
Another advantage that real-time accounting software brings is the shift away from simply compliance (i.e. satisfying the ATO with BAS statements and end of financial year data) to bookkeepers and accounting professionals being able to provide management reporting and advice that is relevant and vital in a business and targets areas that need improvement and areas of growth.
Prior to this, most reporting was done many months after the financial year end which is great for the ATO and compliance, but of very little use to the business owner who needs to know how their business is doing now, not 12 months ago. Working with historical financial data doesn’t allow you to make business decisions that are relevant and important in the now.
So, modern bookkeepers are moving towards providing “more than just the numbers“. We are becoming trusted advisors who emphasise the relationship with our clients and provide a range of value-added services that move bookkeeping into an asset for the business owner and give them real and concrete information, reporting and analysis that they can use to help make their business grow. Because isn’t that why you are in business?