Certified practising accountants and business accountants can perform bookkeeping tasks, if needed, but usually don’t as they undertake many extra years of study and training compared to a bookkeeper. Hence, they normally charge a higher fee than a bookkeeper and are expected to perform advisory and analytical tasks.
An accountant is focused on offering financial projections and advice on the future finances of your business based on their analysis of financial data or business financials, such as the previous year’s performance of your business.
With the advice of an accountant, you can then expect to make better, informed business decisions.
Other specific services an accountant can provide include:
Although this may not be a complete list, the tasks mentioned above indicate the analytical and advisory nature of the accountant role.
At the core of bookkeeping is maintaining the general ledger — a basic document where the bookkeeper records the details of day-to-day financial transactions from the sales and expense receipts. Originally, ledgers were always done on paper, but today, much of this work is computerised, so bookkeepers also do a fair amount of data entry work. Through computerisation using software such as Xero, Quickbooks, MYOB, Netsuite, etc., it is now much easier to perform the tasks needed to update a ledger.
Compared to the role of an accountant, the job of a bookkeeper can be considered simpler, although it’s an essential part of
documenting and safeguarding the financial aspect of your business. The bookkeeper is usually the person who will be assisting you with collating financial records, maintaining general ledgers and recording financial transactions to ensure your business continues to run smoothly.
In general, the bookkeeper is in charge of the following tasks:
There are several other tasks that a bookkeeper can take on for small businesses. As seen in the functions outlined above, a bookkeeper’s roles are usually related to the ongoing maintenance of your financial records.
Knowing the major differences between the roles of bookkeepers and accountants, it’s quite obvious that both are critical to the growth of your business. A bookkeeper essentially collates a large proportion of the data an accountant needs to make analyses.
So, instead of looking at this as an accountant-versus-bookkeeper kind of situation, it’s important to note that both professionals work together to best serve the financial requirements of your business.
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