The Accountant in Business

Roles in the Accounting Function

The accounting function in a business is organised hierarchically. In larger organisations there is a clearer division of responsibilities.

The Bookkeeper

Bookkeeping is the process of recording the day-to-day financial transactions of an organisation in a complete and systematic manner. The bookkeeper is responsible for:

• Maintaining accounting records
• Entering transactions in the day books (purchase, sales, purchase returns, sales returns, cash book, general journal)
• Posting entries to the relevant ledger accounts
• Preparing the trial balance
• Checking the accuracy of the accounting records

Ledger Clerks

• Sales ledger clerk — manages customer accounts where goods have been sold on a credit basis; sends statements to customers and ensures amounts owed are settled in line with credit terms
• Purchase ledger clerk — manages supplier accounts where goods have been bought on credit; liaises with suppliers to ensure payment is made in accordance with the agreed credit terms and conditions

Both the bookkeeper and ledger clerks report to the accountant.

The Accountant

The accountant builds on the information produced by the bookkeeper. Responsibilities include:

• Preparing the financial statements (income statement, statement of financial position)
• Ensuring accounting concepts are applied correctly to the preparation of financial statements
• Ensuring financial statements show a true and fair view
• Overseeing the work of bookkeepers and ledger clerks
• Interpreting, analysing and communicating financial results to stakeholders

Bookkeeping vs Accounting

Key distinction: Bookkeepers record day-to-day transactions; accountants prepare and interpret the financial statements and oversee the recording function.