People often confuse the roles of bookkeepers, accountants and certified public accountants (CPAs). It's not surprising since many of their duties overlap, but the overall responsibilities of each role and the level of authority held by the positions differ. They all share fiscal responsibility – in degrees – for the company or organization for which they work.
Bookkeepers
Often considered by accountants and CPAs as just technicians or clerks, bookkeepers perform some of the same daily tasks as do accountants and certified public accountants. Many bookkeepers work as freelancers for small businesses in need of financial recordkeeping. Bookkeepers maintain daily accounting records, posting debits and credits, generating invoices for clients and checks for vendors as well as handling payroll. Many small business owners often double as bookkeepers. Bookkeepers typically lack the education of an accountant or CPA, as they gain on-the-job experience. Professional organizations for bookkeepers help to improve professional recognition for bookkeepers by accounting professionals as well as providing certification programs of abilities and skills.
Accountants
Accountants have a four-year college degree. While many accountants have an educational background in accounting, some are more general business majors. Companies that generate more than a million dollar in sales each year might have an accountant on staff or hire the services of a professional accountant from an accounting firm managed by a certified public accountant. As the company grows, the accounting department expands to handle the increased fiscal responsibilities within the organization. Accountants work with accounting clerks and technicians who handle daily financial entries. Accountants oversee or perform billing, make general ledger entries, review accounts payable activity completed by clerks or technicians or handle payroll. A mid-level position in the accounting department, accountants report to accounting managers, company controllers or financial directors, all of whom might be certified public accountants.

What's the Difference Between a Bookkeeper and an Accountant?
Fledgling small-business owners are often told that they should hire a professional to help with the accounting side of their companies. Because both bookkeepers and accountants offer services, understanding which one you need can be puzzling.
Katie Bunschoten (pictured), founder and owner of the bookkeeping and consulting firm KHBOffice, helps new businesses get up and running — and shows owners how to keep on top of accounting. The Intuit Small Business Blog recently asked for her take on bookkeepers vs. accountants and when to hire them.
ISBB: What are the main differences between bookkeepers and accountants? What training do they need to call themselves one or the other?
Bunschoten: The terms “bookkeeper” and “accountant” can be interchanged to a degree, so I’m going to focus on the literal job roles. Many bookkeepers get their start acting as a data-entry clerk or entry-level bookkeeper for a business and grow, through experience and merit, into being a go-to person for the day-to-day financial recording. The term “bookkeeper” is pretty literal: The bookkeeper keeps the books and retains documentation for transactions.
An experienced or certified bookkeeper may eventually move into being an accountant (the terminology and rules on what a bookkeeper may do and call themselves may be dictated by state accounting boards). An accountant may also focus on reporting, business analysis and processes, and possibly advice. Many times a bookkeeper and accountant work in tandem, with the bookkeeper operating as a “feet on the ground” professional, promoting a stronger relationship between an accountant and a business owner.
Both bookkeepers and accountants can obtain certification, if they choose, through a professional organization such as AIPB (American Institute of Professional Bookkeepers) or the AICPA (American Institute of Certified Public Accountants), respectively. The terms “bookkeeper” and “accountant” can be used without certification, so it’s important to know what qualifications people have before hiring them.
How do small-business owners figure out which they need?
Many times it depends on the industry and the level of expertise required. Questions we ask our clients in order to structure our services include: What industry is the company is in? Do they maintain a number of fixed assets or a large amount of inventory? How many employees do they have? The more complex the organization, the more important it is to make sure that the company’s bookkeeper is also supported by a good CPA who can provide advice as and if needed. It’s a great partnership that keeps communication open and data strong.
Also, it’s not a bad idea to ask for client references and proof of purchase of E&O insurance, which is available to both bookkeepers and accountants.
How expensive are bookkeepers and accountants?
Bookkeepers are, generally speaking, less expensive than CPAs, which makes them a great choice for a company that needs day-to-day expertise. A good bookkeeper can also act as the “canary in the tunnel,” bringing attention to something that might need higher levels of advice. Pricing depends on geographic location and industry, as well as experience.
I would recommend calling around to local accounting or CPA firms, other business owners, or even local business-development centers in order to obtain a referral. A bookkeeper is best found through word of mouth, and many times the you have to look hard because, quite frankly, a good bookkeeper gets busy pretty fast.
I also would highly recommend meeting with an accountant or CPA at the onset of a bookkeeper engagement and periodically afterward. Bookkeepers are a great way to manage expenses, but having the periodic support of a CPA ensures that you have more than one set of eyes on the books. This not only helps to provide more accurate data, but also can act as a deterrent to fraud or theft.
How do you make sure that you hire a qualified bookkeeper or accountant?
Ask for references, and call them. If certified, call the board or organization through which the professional is certified. There are also free screening tests on the marketplace, especially for bookkeepers, who may not always be certified and where the onus is more on experience. A referral means a lot.
What other qualities are important?
Be sure to seek out a bookkeeper and an accountant who can speak to you in plain English. Many financial or accounting professionals struggle with this. Also, never be afraid to stand up and say, “I’m not fully understanding what you are telling me. Can you rephrase?” Accounting can be a lot of gobbledygook and is a language all its own. Professionals can be very good at what they do, but they also need to be able to explain concepts easily.
A professional demeanor, friendly personality, and honesty are also important. You want to be sure that if there is something crucial that needs to be discussed, the discussion is timely — and isn’t put off if it’s unpleasant.
When should you hire a bookkeeper?
The earlier the better. Many owners will try to sort out the information themselves and then have a bumpy ride when it comes time to transition. A good compromise is to consult with an accounting professional when the business is started and then perhaps touch base periodically, such as once a quarter. Ask for a quote or pricing, and fit in some sort of periodic meeting into your budget. Errors tend to continue until caught at year end or the next time a professional sees the books. Books that are set up correctly in the beginning can be a strong tool for measurement and growth. Books measure the pulse of a business, and good bookkeeping expands past basic cash expenses.
Additionally, most accountants and bookkeepers are happy to answer a few questions, and they enjoy being able to see a business grow and for clients to be successful. After all, the basement startup today could be their biggest client tomorrow.
Difference between Bookkeeping and Accounting
Post written by MissCPA
Bookkeeping and accounting are both relevant tool in communicating the financial activity, performance and condition of a business entity.
The important role of bookkeeping and accounting in every business has increased the demand for bookkeeping and accounting job or services worldwide. Because of the high demand, it made bookkeeping and accounting as two of the most profitable and rewarding profession in the world.
If you want to enter this lucrative profession and opportunity, it is a good choice to learn and understand the concept, principles and procedures of both bookkeeping and accounting.
In this article, you will pick up valuable learning on the distinct definition of bookkeeping and accounting, and the difference between them. You will understand the function and process of both bookkeeping and accounting, what separates bookkeeping from accounting, and when bookkeeping or accounting procedures is used. Bookkeeping vs Accounting
It is very common for non-accountants to think that bookkeeping and accounting are of the same thing. Although they both involve the process of recording the financial transactions of a business, bookkeeping and accounting are two different topics. Bookkeeping is the process of recording, in chronological order, the daily transactions of a business entity. It forms part of the accounting information system. On the other hand, accounting is an information system – includes the process of recording, classifying, summarizing, reporting, analyzing and interpreting the financial condition and performance of a business – in order to communicate it to stakeholders for business decision making. Illustration
To provide a clear understanding of the difference between bookkeeping and accounting, take a look at this sample illustration.
Imagine there’s one piece of apple pie divided into 6 slices. Each slice was given a corresponding name as recording, classifying, summarizing, reporting, analyzing, and interpreting. The whole one piece of apple pie is called the accounting information system which represents accounting. On the other hand, bookkeeping represents one slice of the apple pie which is recording. Bookkeeping is an important part of the accounting information system because it serves as the groundwork of accounting. Bookkeeping is a branch of accounting which is responsible in recording the financial transactions of the business. It is the starting point of the whole accounting process. The person responsible on the bookkeeping process is often referred to as bookkeeper or accounting clerk. They are the one who ensures the recording of business transactions in the book of accounts, such as journals and ledgers, in chronological manner.
Bookkeepers are responsible in safeguarding the completeness and accuracy of the book of accounts. They assist accountants in preparing reports, like financial statements or tax returns, by providing summary and supporting documents of the recorded business transactions. Bookkeeping is only limited to the recording process, although in cases of small businesses, bookkeepers may also do the preparation of reports. As such, bookkeeping can be performed by non-accountants who gained relevant trainings and experience in bookkeeping. To learn more about bookkeeping job, read our article entitled, “What is a Bookkeeper?” Accounting, on the other hand, represent the whole accounting process, from recording until interpreting business financial information. Accounting is one of the most diversified professions because professional accountants have different options in which area of accounting they want to focus their career – such as financial accounting, managerial accounting, tax accounting, auditing, etc.
Unlike bookkeeping, accounting jobs are performed by accounting graduates or licensed professional accountants. Accounting involves more technical understanding and procedures compared to bookkeeping. To learn more about accounting job and careers I hope this article has been helpful for you to learn the difference between bookkeeping and accounting. You may share your thoughts, additional information, queries and concerns via comment box below.