The difference between Bookkeeping & Accounting

The difference between Bookkeeping & Accounting

When a business is set up and running, two types of staff will perform accounting functions. The one doing the day-to-day transactions and posting to the ledgers will be a bookkeeper. A business cannot run accounting functions only with a bookkeeper and needs an accountant.

Nowadays, particular kinds of accountants do different jobs as part of a given company. Some controllers monitor spending and resource use; these are called ‘audit’ accountants. Then other professionals use accounting information to guide procedures and to facilitate decision-making, and these are referred to as ‘management’ analysts.

Types of accounting work

One could say that while audit accountants are involved in book-keeping history. Management accounting looks to foresee events and plan for these regarding a company’s resources. ‘Ledgers’ and excellent accounting ideas belong more to audit accounting, while management accounting deals directly with the machinery of a firm. Both positions require people and analytical skills; accountants must know how to use computers. Spreadsheet software like Microsoft Excel is famous for keeping accounting information in a flexible format.

The main task of an accountant

It is usual for small businesses to hire an in-house bookkeeper and then outsource the accounting function. The bookkeeper will work throughout the year performing functions posting and balancing books and the payroll. At the end of the year, an accountant will take over the rest of the work. The activities include preparing financial reports; Then, the accountant will work with the auditors to produce the final and approved accounts.

Some small companies have exempted audits as their turnover is within the required limit. The accountant will provide the final reports and meet with the directors to discuss accounts. The accountant will advise the directors about the areas of concern. For example, the company’s profit and loss, the budget’s monetarization, and cash flow. Then again, about the contingency plan and father investments in an emergency.
There is no limit to the work an accountant can do for a company; the vital factor is maintaining a proper accounting system for the company’s survival.