The role of an accountant is crucial to help businesses succeed, and depending on the company’s size, they may be a department of one or part of a larger team. While they account for things, their position offers a variety of tasks in many industries, from government agencies to financial institutions and small businesses to large corporations.
Are you interested in becoming an accountant and wondering what it involves? The first thing to understand is that there are no set tasks that are performed like clockwork in a factory. An accountant balances various jobs, with some tasks lasting several days and some lasting less than an hour. They also work different positions, including contract finance jobs.
Here are some of the daily duties of an accountant.
Duty #1: Documenting Financial Transactions
This is the most common task for an accountant and is vital to a business’s operation. All transactions need to be recorded as journal entries in spreadsheets and then used to produce financial reports at a later date.
This recording of events and activities ensures the accuracy of the transaction and includes the following:
- Invoices
- Purchase orders
- Cancelled checks
- Cash register receipts
- Customer refunds
- Computer-generated receipts
- Deposit slips
Duty #2: Preparing Financial Statements and Reports
Financial statements show a company’s financial position and an accountant prepares them. Because of the complexity of a business and the amount of data, an accountant will generally have reports of several types of statements created, including:
Income Statement
This is a profit and loss statement listing money coming in and going out over a set period and includes revenue, expenses and losses to indicate if a profit has been made.
Balance Sheet
A balance sheet indicates the current value of a business to determine if it can meet its financial obligations and has three key things: assets, liabilities and equity.
Cash Flow Statement
This statement details how money comes into and exits a business and shows the available working capital at a set time. It also measures how well a company can fund operating expenses, investments and debt obligations through its generated cash.
More detailed financial reports will also be produced at year-end, giving a greater insight into a company’s financial health.
Duty #3: Prepare and File Taxes
Tax season is usually the busiest time for an accountant, but they compile records and figures throughout the year to prepare these documents. Beyond filing these returns, they also:
- Create tax projections
- Produce quarterly and annual tax reports
- Identify tax savings and recommend strategies
- Estimate and track tax returns
- Track changes to tax laws
An accountant ensures this filing process follows all regulations and guidelines to help the company avoid any audits.
Duty #4: Give Financial Advice
Accountants are finance experts and can be valuable team member for any company. They can make key recommendations about a company’s procedures and current resources, especially if they have financial problems, and use their knowledge to offer solutions to stay compliant and make operations more efficient.
Duty #5: Regulation Compliance
Businesses must follow the rules and regulations about their financial operations, and an accountant is there to ensure all laws and regulations are complied with. Financial reporting must be accurate, using best practices to be diligent to avoid financial misconduct.
Transactional documentation and reconciliation ensure transparency and traceability of all transactions and reporting.
Duty #6: Payroll
Payroll is an accounting process that relates to employees and focuses on wages and salaries, benefit costs and paid time off. Accountants track and file compensation data, including any benefits and taxes an employee receives and any withheld money.
This needs to be performed weekly, bi-weekly or monthly, depending on the employment set up and will include terminations, new hires and any changes to pay rates. They maintain accurate records to comply with federal and local wage and hours laws.
Other factors also determine an accountant’s daily duties:
Company Size
A small firm will expect its accountant to do everything, while a large firm with an accounting department will have you focused on a specific niche.
Job Title
This is a specialization where you may only do payroll or be a tax accountant.
Experience
Your accounting experience will dictate your daily activities as a junior accountant may be filing and creating balance sheets. At the same time, a senior member will analyze the company’s position and focus on the business end.
Time of Year
If it is tax season, an accountant will be more focused on preparing taxes and other tax-related projects.
Ultimately, an accountant is a strategic partner in any company and will help manage finances to assist them in reaching their goals faster. These daily duties and more make up a typical day for an accountant, but no day is the same and never typical.
