If you’re not sure you understand the difference between a bookkeeper and an accountant, don’t feel stupid. The fact is, many bookkeepers and accountants don’t understand the difference either. Both are educated professionals that deal in business finance and that are well schooled in accounting principles, but each does a uniquely different job. Sometimes, the line between those duties is blurred and highly functional bookkeepers may perform duties more typically ascribed to accountants.
Depending on the size of your company, you may only need a bookkeeper. The good news is that working with an outsourced accounting firm, you can have access to one or both, and you can add or eliminate services as dictated by your company’s specific needs. Here’s a quick primer that will help you determine the differences between a bookkeeper and an accountant, and how to know which of the two your company will need.
Bookkeepers…
· Manage the company ledger and prepare monthly financial statements.
· Perform accounts payable duties by organizing and paying for bills and expenses.
· Perform accounts receivable duties by collecting monies owed through invoicing and the tracking of past due accounts.
· Reconcile bank and company credit card statements.
Accountants…
· Oversee the work performed by bookkeepers.
· Use a keen understanding of accounting principles to interpret monthly financial statements that have been prepared by the bookkeeper.
· Prepare reports to monitor the financial health of a business.
· Offer their expertise and advice to business owners and chief decision makers about the company’s financial health and tax planning.
Once you’ve determined what level of accounting outsourcing you need for your business, you’re ready to move on to the next level. Visit AccountingDepartment.com to review the seven-stepstartup process to getting your own personal remote bookkeeper or accountant.
