Bookkeepers and accountants share common goals and support business in different financial life stages but are undoubtedly different from each other, especially when it comes to executing organizational roles and tasks.
Bookkeeping and accounting top the list of most important aspects of running a business, and regardless of the size and scale of the company, it requires close tracking of expenses and cash flow. Business owners need to ensure their finances and data are recorded, assessed, and processed correctly. They base their financial decisions on the company’s financial status. While this all may seem easy at first glance, but the reality is, it is time-consuming and more complicated than you realize. Hiring a bookkeeper or accountant to do specific business tasks such as bookkeeping and accounting is ideal in every sense. Specialized expertise allows you to focus more on core business operations. This focus means that the books’ successful management gets you one step closer to claiming the top spot in the industry.
There is often a misconception that accountants and bookkeepers have similar tasks and duties, which they need to ensure collectively. However, this is not the case. They both are undoubtedly different from each other and have different roles to play in the organization. It is true that both bookkeepers and accountants support your business in various areas of business and stages of the financial cycle and share common goals. Still, they are undoubtedly different from each other. Bookkeeping involves admin related tasks such as transactional and administrative when it comes to recording critical financial transactions. At the same time, accounting is more subjective and requires accounting decisions based on bookkeeping records and information. Both have individual characteristics and help a business achieve its long-term goals and ambitions. So, accountants and bookkeepers are, one way or another, different from each other!
What Is Bookkeeping?
Bookkeeping is a baseline where day-to-day transactions are recorded consistently (without a gap). It is a key that unlocks the doors to a financially successful business. Besides financial transactions, it includes producing and settling vendor invoices, posting debits and credits, completing payroll, calculating GST, designing and reviewing accounting systems, preparing initial financial statements, reconciling accounting and making reports, and more.
What Is Accounting?
It wouldn’t be wrong to say that accountants base their accounting decisions on bookkeeping records. Accounting is instead a high-level process that uses sensitive financial data prepared and processed by a bookkeeper for making crucial business decisions. The big picture involves preparing company financial statements, completing and filing tax returns, analyzing costs of operations, financial management advice, auditing, business establishment assistance, corporate reporting and compliance, and more.
Shifting Landscape
In today’s corporate workplace, most small to mid-sized businesses shift to bookkeeping and accounting software as they lack resources to hire in-house talent. Hiring professional accountants and bookkeepers are costly to companies. That’s the motivation that leads them to incorporate accounting software in their companies. Businesses used to have second thoughts of whether to use such software. Now owners are readily using them in their companies as they have produced fantastic results.
Hiring a Financial Professional
Ensuring the financial accuracy of day-to-day transactions and using the bookkeeping data to make future-proofing decisions require you to hire a financial professional’s expertise. The accounting software can help you out to a certain extent. Businesses that are growing will need to consider hiring accounting specialists.
Since accountants have to make decisions on bookkeeping records, hiring a professional agent seems fair.
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