Bookkeeping is more focusing on entering and recording transactions where accounting is more about giving the business insight based on the bookkeeping information.
Bookkeeping consists of:
- Recording financial transactions
- Posting debits and credits
- Producing invoices
- Paying vendor bills
- Maintaining and balancing subsidiaries, general ledgers, and historical accounts
- Completing payroll
Accounting consists of:
- Recording expenses that have occurred but aren’t yet recorded in the bookkeeping process
- Preparing company financial statements
- Analyzing costs of operations
- Completing income tax returns
Aiding the business owner in understanding the impact of financial decisions
| Bookkeeper VS Accountant | Bookkeeper | Accountant |
| Role | Required for identification, classification and recording of all financial transactions | Involved in interpreting, summarizing and communicating the financial transactions |
| Tools Used | Journals and Ledgers | Profit & Loss, Balance Sheet and Cash Flow Statement |
| Skills Required | No special skills required | Professional degree in accounting and analytical skills for interpretation |
| Complexity | Level of complexity is low | Comparatively high level of complexity |
| Financial Decisions | Cannot be made based on book-keeping | Decisions can be made on accountant’s records |
| Management Role | · Single Entry· Double Entry· Virtual | · Management· Financial· Payroll compliant· Tax compliant |
