The Revolution In The Bookkeeping Profession!

The profession of bookkeeping has undergone massive changes during the last few decades. The traditional image of a bookkeeper is someone sitting in a room pouring over figures. It is certainly not the sort of profession one would associate as undergoing a revolution.

The earliest image I remember of a bookkeeper is my mother pouring over massive green ledger books on the table tennis table in our rumpus room back in the 1980’s. Those were the days before every home had a computer and the service offering of bookkeepers was pretty much limited to writing up journals, issuing invoices and paying bills. Anyone could call themselves a bookkeeper whether they were qualified or not and there was no regulation of their activities. One of our neighbours used to do ironing and bookkeeping. Her clients would come around to her house and she would hand over perfectly ironed shirts in one basket and green ledger books in the other!

With the advent of computers came small business accounting packages such as MYOB. This moved the bookkeeper away from the green ledger book and in front of a computer. The advances in technology enabled the bookkeeper to expand their services by providing reports to their clients such as Profit and Loss and Balance Sheets. However the industry still remained largely unregulated. With the advances in technology making bookkeeping a lot simpler this attracted a lot more unqualified people into the industry and that caused massive problems. Many bookkeepers with no bookkeeping knowledge or experience would go out and do a short MYOB course and open up shop. With no regulation in the industry the client had no recourse if their books were left in a mess other than replacing the bookkeeper.

When the GST regime came into force in the early 2000’s the compliance requirements of small business dramatically increased and in turn made the bookkeeper’s job a lot more complex. Bookkeepers were now expected to understand the GST legislation so they could make sure each transaction had the appropriate tax code. This drove many bookkeepers out of the industry.

Accountants were unable to cope with completing quarterly BAS statements on top of their already heavy workload and this created the need for bookkeepers to step up and take on more of the GST compliance load. In response to this the BAS Agent Legislation was introduced in 2009, which resulted in the establishment of the Tax Practitioners Board. Under the new rules all bookkeepers that are doing any sort of GST/BAS work are required to be registered with the Board as a BAS Agent. As most bookkeeping tasks involve GST/BAS work of some description anyone not registered found it very difficult to work as a bookkeeper unless they were supervised by another bookkeeper who is registered.

The Board requirements for membership are quite strict and include having at least a TAFE Certificate in Bookkeeping (which is a 12 month course), 1400 hours of relevant experience during the last 4 years, holding suitable professional indemnity insurance and undertaking continuing professional education. There is also a strict code of conduct that must be followed.

These new developments are great for small business owners as they now can be certain that their bookkeeping will be handled by a skilled professional who is competent to do the work. If something does go wrong the business owner now has recourse. As bookkeepers are more skilled and professional then ever before it means they can take on more value added work such as analysing the numbers and helping business owners to make sense of them. When hiring a bookkeeper it is important to check the Tax Practitioners Board website to make sure your bookkeeper is listed as a Registered BAS Agent.

There is no doubt that the bookkeeping industry has evolved dramatically from being completely unregulated to an industry that is highly professional. In the next few years as cloud technology becomes more prevalent the industry will be completely turned on its head again with more automation of traditional tasks such as data entry and the changing role of bookkeepers to more of an advisory role. The revolution is certainly happening and the bookkeeping industry is an exciting place to be but I suspect this is just the beginning.

What has been your experience of working with bookkeepers over the years? Have your expectations of the role of a bookkeeper changed?

Would love to hear your thoughts!

#bookkeeping #xero #accounting #cloudsoftware #taxpractitionersboard #gst #bookkeeper #accountant

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