In the world of business, two of the most useful—and commonly mixed-up—financial services are accounting and bookkeeping. At first glance, it may seem like these fields are much the same—and they do overlap in some areas. However, while bookkeeping primarily focuses on financial management and record-keeping, accounting often consists of analysis, strategy and financial advice. Both of these services can prove incredibly useful to business owners, boosting your success together and apart. As such, it can be difficult to decide which one will best support you and your company.
Luckily, when you work our team at Estess CPA, you don’t have to choose between them. Our experienced professionals can provide financial services including bookkeeping, accounting and Quickbooks training, allowing you to find all the help you need in one place.
What is Accounting?
Accountants are financial professionals who leverage business data in order to take a broad look at your company and steer business owners toward long-term financial success. They assist a variety of organizations, either on a permanent basis or in a freelance capacity, in conducting financial reviews, preparing tax returns, performing audits and more. Like bookkeepers, their work helps business owners make smart, well-informed financial decisions. Unlike bookkeepers, accountants are often able to provide more detailed advice, combining their knowledge of your company’s financial information with their understanding of existing laws and regulations to reduce or prevent errors or complications.
When not considering field specialties, accountants primarily take two basic forms: certified and uncertified. Certified public accountants (CPAs) are required to complete certain education and work requirements, as well as pass a rigorous examination, in order to earn their license from their state’s Board of Accountancy. Your average accountant, on the other hand, likely has at least a bachelor’s degree, though they may have completed a different program or found an alternate path into their field. While both CPAs and accountants may take on many of the same responsibilities, the high standards CPAs are held to due to their licensing means they may have more job opportunities and take on more complicated tasks. For example, CPAs may represent their clients in front of the IRS and perform an external audit of your company. If you’re looking for expert accounting services to help manage your finances, working with a trusted professional is a smart investment.
Other common accounting responsibilities include:
- Preparing financial statements
- Tax planning and identifying applicable tax write-offs
- Creating financial forecasts—that is, examining past financial data in order to make predictions regarding your business’ financial future.
- Ensuring compliance with the financial laws and regulations which govern the area they practice in. Accountants utilize these regularly revised regulations to make sure all company financial statements are truthful and consistent.
- Offering advice and guidance regarding your business and finances, and helping you create strategies to ensure future success
- Conducting financial risk assessments—that is, identifying potential risks, such as changes in the market, and making business decisions based on risk severity, the ability to mitigate the risk, and other factors.
What is Bookkeeping?
While accountants require accurate and comprehensive financial data to do their jobs correctly, bookkeepers are often the ones collecting that data. Professional bookkeepers keep organized records of all financial transactions, including sales, payroll, and other income and expenses. These records ensure that business owners and accountants have the information they need to steer the business in the right direction and avoid poor financial decisions.
Like accountants, bookkeepers may focus on specific areas and have different levels of training. While general bookkeepers complete a variety of standard bookkeeping tasks, full-charge bookkeepers take it one step further, toeing the line between bookkeeping and accounting. This may include supervising junior accountants and assisting with tax return preparation. Then, there are certified accountants and certified public accountants, both of which undergo training programs and complete an exam before gaining their certification. If you’re looking for a reliable bookkeeping service to keep your financial records in order, working with professionals can make all the difference.
Depending on a bookkeeper’s experience, several of their tasks may overlap with the day-to-day roles of accountants. These tasks may include:
- Managing accounts payable (what you owe) and receivable (what you are owed)
- Generating invoices and sending payment reminders
- Handling payroll
- Expense tracking in order to monitor your spending and ensure you are staying within your set budget
- Reconciling bank statements—that is, comparing bank records with company records in order to identify and resolve any discrepancies between the two.
- Monitoring inventory
- Managing the general ledger—that is, a record of financial data divided into categories including assets (things you own), liabilities (things you owe), revenue and expenses.
Should You Work with an Accountant or a Bookkeeper: Benefits of Hiring Both
When it comes to deciding between accounting vs bookkeeping services, you must first understand what your company needs. If what you need is someone to take over your day-to-day financial management, a bookkeeper is the perfect choice. But if you are looking for in-depth assessments and assistance planning your business’ future, you may want to consider an accountant.
It is important to remember that many accountants can do a bookkeeper’s job. However, it is often a waste of their skills, as taking over time-consuming bookkeeping tasks will keep them from focusing on what you really need them for—analysis. If you are looking for the services of both a bookkeeper and an accountant, and if you have the money to do so, it may be prudent to hire both. After all, to do the best job possible, an accountant needs the information a bookkeeper provides. And as an added bonus, you will gain the benefit of comprehensive financial records, insightful financial advice, and tax and regulatory assistance all at the same time.
Get Comprehensive Financial Management Assistance with Estess CPA
As a business owner, it is important to understand the differences between financial professionals before deciding which one to bring onto your team. And where one is good, two may be better, as bookkeepers and accountants can work together to provide you with detailed, accurate data and analyses to help plan for your company’s future.
Thankfully, when you work with Estess CPA, you don’t have to debate between accounting vs bookkeeping services. With over 20 years of experience providing assistance to small- and medium-sized businesses, financial support of all kinds is our bread and butter. Our team offers everything from bookkeeping and accounting to payroll and Quickbooks training, allowing you to step back and know that your finances are in excellent hands. So if you are ready to reap the rewards of bringing a financial professional onto your team, Click Here a call or send us a message today.
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