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Bookkeepers And Accountants – What Is The Difference?
When it comes to keeping the records of a business straight, several different people often look at the books to ensure accuracy. Both bookkeepers and accountants will study the figures in order to form reports, but who does what? Some people use the terms bookkeeper and accountant interchangeably, but that is not technically correct.
Accountants and bookkeepers have not undergone the same schooling. They obtain different degrees and certifications. Bookkeepers are responsible for more of the actual financial recording than the accountants. Once they have recorded the numbers in the ledger, it is time to move on to another. Analysis and planning are not asked of bookkeepers. This is simply an indication of different training, not one of incompetence. Bookkeepers usually do their job in monthly cycles. Usually it requires recording transactions, writing reports, and making whatever minor adjustments are needed.
Accountants are responsible for much more analysis and planning than bookkeepers. In large businesses, they often design the bookkeeping system and then monitor it. Once the reports are provided by the bookkeeping team, the accountants analyze them and decide on the courses of action to take. Because of the bookkeeping knowledge required, it is often the job of the accountant to act as supervisor to the bookkeepers. Once accountants have looked at the ledgers, they will calculate figures such as new interest numbers or pending employee wages. They will then draw up financial statements for the business.
Smaller businesses often employ a single person who performs the duties of bookkeepers and accountants. That is because bookkeeping is one aspect of accounting. If the small business does numbers low enough to be recorded and analyzed by one person, there is no need for a distinction. Some states, however, maintain regulations that are very specific to what financial duties one is allowed to perform. These states will permit only CPA’s to perform accounting tasks and provide businesses with the guidelines. In other areas, the distinction comes down to one of prestige. Because accounting requires more schooling and brings greater responsibility, it may concern some to hear a bookkeeper referred to as an accountant.
The lines between accountants and bookkeepers are becoming less clear with the assistance of computer software. With the help of these programs, accountants and bookkeepers are beginning to do one another’s job. The differentiation may continue to disappear as time goes on.
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