Bookkeeping and Accountancy! A comparison!

Bookkeeping and accountancy are two professions which overlap a great deal, but they are not precisely the same thing. A bookkeeper is the person who is responsible for recording all the financial transactions of a business. It was originally called bookkeeping because all the numbers and records were written down in books. Nowadays computers are usually used, but the principle remains the same. The bookkeeper gathers and records data but does not necessarily analyze it. Today some bookkeepers may offer more advanced services that involve a certain amount of analysis, but their abilities in this area are limited. Accountants may do the work of a bookkeeper, but they are also able to bring a more advanced level of analysis to the job.

Accountants can produce financial forecasts and tax strategies and offer financial advice. Their job is to communicate the financial details of a company to various groups of people: employees, managers, shareholders and auditors. This is usually done by way of reports which may breakdown and explain various aspects of the overall financial pictures. Bookkeepers and accountants need to work closely together. If a bookkeeper has not done his job properly, then the accountant will have a hard time doing his job. Bookkeeping and accountancy skills may be taught together in school. Small businesses may only be able to hire one accountant who will also be in charge of all bookkeeping duties. They may also simply hire a bookkeeper or money manager, who may be less expensive than an accountant, and bring in accountants once or twice a year to review their records and prepare tax forms. Large businesses may have many bookkeepers and accountants working in various departments. Some accountants specialize in one particular area, such as taxes or management. Personal accountants keep track of the finances of individuals and help them to prepare their taxes each year.