Accounting Vs Bookkeeping: What’s The Difference?

Small business owners have a lot of things on their plate. From making their product or service to marketing it, they have their hands full. Maintaining the books is often an added responsibility that is tacked on to this already long list. So what’s the difference between accounting and bookkeeping?

Bookkeeping is the process of recording financial transactions. This might include tracking sales, noting expenses, and assessing the financial health of a business. Bookkeeping is a critical task for all businesses, but it is especially important for small businesses that may not have the resources to employ a full-time accountant.

Accounting, on the other hand, is the process of analyzing and interpreting financial transactions in order to make strategic decisions about a business. In other words, accounting is the big-picture view of a company’s finances. It is used to make informed decisions about where a business should allocate its resources and how to grow the company.

Many small business owners choose to do their own bookkeeping in order to save on costs. However, it is important to note that bookkeeping is not the same as accounting. While bookkeeping is necessary for all businesses, accounting is only necessary for businesses that want to make smart financial decisions. If you are a small business owner and are not sure whether you need an accountant, consult with a professional to find out.

You may want to hire a bookkeeper if…

There are a lot of reasons why you may want to hire a bookkeeper. Here are some of them:

1) You may not have enough time to keep track of your finances yourself.

2) You may not be very good at bookkeeping or accounting.

3) You may not have enough knowledge about bookkeeping or accounting.

4) You may not want to deal with the hassle of bookkeeping or accounting.

5) You may want to focus on your business and leave the bookkeeping and accounting to someone else.

6) You may want to save money on bookkeeping and accounting services.

7) You may want to have someone else double-check your books for accuracy.

If any of these reasons apply to you, then it may be a good idea to hire a bookkeeper. A good bookkeeper can save you a lot of time and money, and can help you keep your finances in order.

You may want to hire an accountant if…

There are many good reasons to hire an accountant, especially if you’re self-employed. 

1. An accountant can help you track your expenses and income, file your taxes, and provide other important financial advice.

2. If you are self-employed, it’s especially important to keep track of your finances. An accountant can help you do this and can also provide other important services, such as helping you set up a retirement plan or advising you on other financial matters.

3. If you are not self-employed, you may still want to hire an accountant to help you with your taxes. An accountant can make tax season much less stressful and can help you get the most out of your tax return.

Hiring an accountant is a wise decision for anyone, self-employed or not. If you are looking for someone to help you with your finances, an accountant is a great option.

Can a bookkeeper become an accountant?

Yes, bookkeepers can become accountants. Accountants are responsible for preparing and analyzing financial statements, ensuring that taxes are paid correctly and on time, and advising clients on financial matters. In order to become an accountant, a bookkeeper would need to obtain a bachelor’s degree in accounting and pass the Certified Public Accountant (CPA) exam.