A bookkeeper is an individual who doesn’t have an accountancy college degree but deals with data entry tasks such as processing payroll data, ensuring statements are mailed to the customer, making ready the sales invoice, ensuring payment of bills, and entering bills made by vendors. On the other hand, an accountant has acquired a professional accounting degree and will carry on with the operations done by the bookkeeper. A few examples include:
– Preparing the company’s financial statement such as cash flow statement, balance sheet, and income statement.
– Adjusting entries in order to record the expenses that the bookkeeper failed to enter. These could include employees’ earned wages that require to be processed the following week and bank loans’ interests since the previous bank payment.
– They also help the management to comprehend the financial impact made by its past and future choices.
Bookkeeper vs Accountant: Key Differences
This list contains the detailed differences between the two careers:
1. Bookkeepers are needed for evaluating, quantifying, recording and later classification of financial transactions. Accountants, on the other hand, are needed to summarize, explain and convey the latest financial transactions as filed in the ledger account.
2. Bookkeepers are never tasked to come up with financial statements. However, accountants are paid to come up with financial statements.
3. When it comes down to the exclusiveness of financial decisions, it is usually impossible to rely on book-keeping records but considered with accountant records.
4. Bookkeepers mostly use tools like Ledgers and Journals while that of accountants are Income statements, Balance Sheet, Cash Flow Statement, etc.
5. Generally, the senior management doesn’t get involved with the bookkeepers, but when it comes to accountants, they could be interested in their functioning since they need the information so as to make better future management decisions.
6. With bookkeepers, no special skills are required since a lot of the activities are usually mechanical in nature. Accountants, on the other hand, need specialized analytical skills since there’s a high complexity level involved in keeping the books of accounts safe. To be an accountant, you’ll need a professional accounting degree as well as some past work experience in accounting.
Making sure the financial records are properly organized and the finances correctly balanced out by the bookkeeper, together with smart financial planning and timely tax filing by the accountant, directly accounts to the long-term success that each business needs.