bookkeeping vs accounting | what is the difference
Many people believe the at bookkeeping and accounting are interchangeable. Although they share some tasks and responsibilities, they are distinctively different. Accounting and Bookkeeping both work to aid business finance but there is some vital dissimilarity between the tasks of a bookkeeper and an accountant.
Prior to getting into what the role and responsibilities are involved in bookkeeping and accounting. It is worth mentioning for those that are interested, we have an online bookkeeping course and an online accounting course via the Edna online platform. there are also other courses online available
From the start, it is important to understand that bookkeeping and accounting are both fundamental for business to work. In some cases, their functions can sometimes intersect but there are definitely certain areas of one’s business that will be directly assigned to an Accountant and others given to a Bookkeeper.
The dissimilarity between an Accountant and a Bookkeeper keeps unfolding as accounting software advances. Bookkeepers are in charge of recording financial transactions in sequential order. Accountants, on the other hand, are in charge of interpreting, categorizing, analyzing and summarizing financial data.
What is bookkeeping?
the what Bookkeeping is the process of recording daily business transactions in a consistent way; A bookkeeper’s fundamental role is to support financial records for an organization. In order to do this job meritoriously, a bookkeeper must focus on detail meticulously. This skill allows the Bookkeeper to keep up with company expenditures, income, and payroll.
The functions of a bookkeeper are as follows:
Documenting financial transactions and Preparing first financial statements
Posting debits and credits.
Generating and processing invoices, receipts, payments, and other financial transactions.
Preserving and balancing subsidiaries, general ledgers, and historical accounts.
Completing, Processing and supporting the payroll system.
Merging accounts and preparing reconciliation reports.
Managing amounts owed by debtors, and amounts owed to creditors.
Computing goods and service tax.
Preparing and lodging business activity statements
What is Accounting?
Accounting is a sophisticated process that utilizes financial facts collected by a bookkeeper or business owner. The process of accounting is more particular than bookkeeping. Therefore an accountant is a qualified person who carries out accounting functions such as audit or financial statement analysis. Accountants are usually employed by a large accounting firm, with an internal accounting department; they are also self-employed having their own personal firm.
Accountants play an important role in any business that he or she works for, whether it is a large conglomerate or a medium to small firm. They are in charge of recording and overseeing the flow of funds through an organization.
What does an Accountant do?
Examines revenue and advocate the right budget levels and ensures expenditure control.
Ascertain and processes monthly payrolls requirements.
Handles financial data and reports for the firms’ automated financial systems.
An accountant resolves accounting issues
Set up, support, organize and implements accounting and accounting control processes.
Despite the organizational differences, financial records and accurately balanced finances produced by the bookkeeper joined with the flawless accounting functions such as auditing or financial statement analysis give directly to the durable success of every business.