careertrend article image
Prapass Pulsub/Moment/GettyImages

How to Get a Bookkeeper's License

Growth Trends for Related Jobs

Bookkeepers record financial transactions as part of an organization's accounting procedures. Although a bookkeeping license is not always necessary to get hired, professional credentials can increase opportunities for employment as well as translate to higher pay.

Job Description

Bookkeepers need basic math and computer skills. They should know how to use spreadsheets and be familiar with bookkeeping software such as QuickBooks and Microsoft Excel. Bookkeepers are typically responsible for such tasks as:

  • Balancing and maintaining accurate ledgers.
  • Coordinating bank deposits.
  • Developing monthly financial statements, including balance sheets, cash flow and profit and loss statements.
  • Matching purchase orders with invoices.
  • Paying vendor invoices and tracking bank account balances.
  • Preparing quarterly and monthly tax returns, including business, operating and payroll taxes.
  • Reporting financial results to management on a regular basis.

Education Requirements

There's typically some learning that happens on the job, but getting a position as a bookkeeper usually requires some post-secondary education. At minimum, employers seek candidates with a certificate or associate's degree in accounting or bookkeeping.

Coursework for a certificate or associate's degree program typically includes accounting principles, spreadsheet applications, computer technology, mathematics and career electives such as business communications, management and marketing. Degree programs require more credit hours and typically include core courses such as English and humanities.

Private, for-profit career schools may offer training or certificate programs for bookkeepers. Before enrolling in one of these programs, find out whether the school is accredited because that will affect your ability to get federal financial aid. Get complete details about the total cost of the program, including tuition, fees and books. Talk to current and former students, and, if possible, get information about employment rates of program graduates.

Cost of Training

Some certificate and associate's degree programs are available in a school setting, while others can be completed 100 percent online. Costs and program duration vary by institution. The tuition and fees for an online program are not necessarily lower than if you attend classes in person, but taking classes online gives you flexibility if you're working and also saves on transportation costs.

As an example, Lone Star College in Harris County, Texas, offers several programs for aspiring bookkeepers, including an associate's degree in accounting, an accounting certificate, an accounting advanced technical certificate, accounting assistant/bookkeeper certificate and payroll assistant certificate. Most are available as online programs. Tuition for the 2018-2019 school year was $96 per credit hour for local residents, $191 per credit hour for out-of-district Texas residents and $252 per credit hour for out-of-state students. Some programs can be completed with as few as 18 credit hours and in as little as four months.

Licensing and Credentialing

You do not need licensing or credentialing to be employed by someone else as a bookkeeper. Depending on where you live, there might be licensing requirements if you have your own business. Check with the Small Business Administration branch in your community to find out what's required if you plan to be self-employed.

The National Association of Certified Public Bookkeepers offers credentialing by exam. Passing the four-part exam validates your knowledge of accounting principles, bookkeeping, payroll and QuickBooks. The CPB license helps you distinguish yourself in the profession by validating your knowledge, experience and professional ethics.

Eligibility for the exam requires an associate's or bachelor's degree in accounting. A combination of education and work experience can be substituted for this requirement. A minimum of one year of full-time work as a bookkeeper is required. In order to maintain your license, you must complete 24 hours of continuing professional education annually.

Certification is also available through the American Institute of Professional Bookkeepers. This certification is primarily designed for individuals who have no formal training in bookkeeping or accounting, but who have gained knowledge by working in the field. Founded in 1987, the AIPB offers preparatory courses for certification and continuing education. The organization has a job board on its website and also offers a free bookkeeping test that employers can use to assess job candidates. For job seekers, the test is a valuable resource for assessing your knowledge and skills when looking for work and applying for open positions.

Work Environment

Bookkeepers work for companies of all sizes, although there are greater opportunities with small businesses. Every small business needs to record financial transactions. Hiring a full-time accountant is expensive, so small organizations often employ bookkeepers for the day-to-day financial details and bring in an accountant for monthly or quarterly reviews.

Bookkeepers typically work in a client's office or in a home-based office. Bookkeepers are part of an organization's financial team, so they must be able to work well independently and also with other team members, which may include clerical, administrative and management staff, as well as accounting professionals.

There are both full- and part-time employment opportunities for bookkeepers, depending on the market in any geographical area. Some bookkeepers are able to establish successful home-based businesses, meeting with clients in a home office, traveling to clients' offices as necessary, or even working with clients virtually.

Starting Your Own Business

Some bookkeepers aspire to start their own businesses when they complete their training or after working for someone else. Self-employment can be the right choice for motivated, organized self-starters who want the freedom and flexibility of being their own boss. To get started with your own business, these steps are recommended:

  • Get a CPB license or bookkeeping license through AIPB.

  • Create a business plan. This step is essential if you're going to try to get funding to establish your business.

  • Incorporate your business. Find out the requirements at local, state and federal levels through a branch of the Small Business Administration.

  • Choose a business name that clearly indicates what you do. Names such as City Bookkeeping Services or Jones Tax Prep make it easy for potential clients to find you.

  • Determine your business structure: sole proprietorship, partnership, limited liability company (LLC) or corporation.

  • Set up business operations to keep your business and personal finances separate. This means opening a business account at your bank, obtaining a business credit card, getting bookkeeper's insurance and possibly leasing office space.

  • Purchase the appropriate software. Most small businesses use QuickBooks. Understand how to use a file sharing program so that you can send documents electronically back and forth with clients. Dropbox is a good, free option that allows you to purchase additional storage space if needed.

  • Set up a home office space if you're not going to lease outside space. Use the home office as workspace. It is generally recommended that you do not invite clients into your home unless you know them well and have a private space in which to work.
     
  • Set up a professional email account. If you opt to use your existing home or cell phone, add a professional message to your voicemail so clients know they've called the right number.

Salary and Job Outlook

The U.S. Bureau of Labor Statistics tracks data and makes projections for all civilian occupations. In 2018, the BLS reported the annual median pay for bookkeeping, accounting and auditing clerks was $40,240. Median pay means that half employed in the profession earned more, while half earned less.

Salaries vary according to a number of factors, including education, experience, employer and geographic location. A certified bookkeeper's salary may be higher than that of a bookkeeper without professional credentials.

Advanced technology, specifically accounting software, has automated some of the processes that bookkeepers once did manually. As a result, the BLS predicts little or no change in job growth for bookkeepers through 2026.