Many people see the terms accounting and bookkeeping and think that they're the same thing. And even though they share many similarities, there are clear distinctions between the work of an accountant and the work of a bookkeeper. An accountant can most definitely work as a bookkeeper but it doesn't work vice versa. In smaller companies, it's usually the accountant who works as a bookkeeper – especially if they've taken a course or two on bookkeeping. But, accountancy is much more complex than bookkeeping.
What Does An Accountant Do?
Accountants oversee all of the financial transactions and business reports of the company. They analyse and interpret financial data to report the financial condition and performance of the business and help the management informed business decisions. In a nutshell, accounting is the process by where a company’s financials are recorded, summarized, analyzed, consulted and reported on. They can become certified public accountants (while bookkeepers can't) and are usually paid better.
What Does a Bookkeeper Do?
Typically, bookkeepers aren’t required to have any formal education. To be successful in their work, bookkeepers need to be knowledgeable about key financial topics. Usually, the bookkeeper’s work is overseen by either an accountant or the small business owner whose books they are doing. So a bookkeeper can’t call themselves an accountant. Because accounting software automates many of the daily bookkeeping processes, some bookkeepers in small organizations also classify and summarize financial data in financial reports. These bookkeepers are often referred to as full-charge bookkeepers. They make higher salaries than bookkeepers but lower salaries than accountants.
Now you know what a bookkeeper and what an accountant does, what are the similarities and differences between the two job functions. Do you think your company could benefit from a bookkeeper and/or accountant on demand? Contact us today for more information for our on-demand financial services!