Bookkeeping is Not Accounting and Vice Versa

By October 5, 2016Bookkeeping

Many individuals consider bookkeeping and accounting to be the same thing and use the two interchangeably. This is understandable because the accounting process includes the bookkeeping function, but is just one part of the process.

Primarily, the bookkeeper records the day-to-day financial transactions of the business. For example, accounts payable, sales and accounts receivable transactions. Bookkeepers are expected to be accurate, efficient and knowledgable. The role of the bookkeeper will differ with the type and size of the business.

The accountant takes it one step further by analyzing the transactions and presenting that information in a more useful format (financial report). The accountant prepares and interprets the financial reports. Recommendations can be made to the business owner as he/she prepares for the future of their business.

Whether you are just starting out or have been in business for a while, it is important to keep accurate financial records and to know the financial health of your business. From keeping accurate records, creating useful reports and going over the numbers with you, the business owner, an accountant can free up your time to focus on the business of running your business!