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.

Bookkeepers usually do not have the same schooling as accountants. Their degrees are often different and they have taken different classes. The actual recording duties for a business are often done by the bookkeepers. Once the figures are recorded in a ledger, they go on to the next. Their job usually does not consist of analysis and planning. That by no means that they are unqualified to perform advanced financial tasks, it is just not often asked of them. Most of the bookkeeping duties are on a monthly cycle, consisting of recording transactions, writing reports, and making minor adjustments.

Accountants are responsible for the analysis and planning stages of record keeping. The bookkeeping processes of large businesses are often created by accountants who then assume monitoring duties. Based on the numbers they enter, the bookkeepers write up reports that the accountants then look at in order to analyze and plan for future financial moves regarding the company. Because they have a bookkeeping background, accountants are usually supervisors to the bookkeepers. Once the figures are placed in the ledgers, accountants look at them and calculate future numbers such as new interest figures and wages owed to the employees. Once these new figures are calculated, the accountants draw up a financial statement.

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.

It may never be completely clear, especially with developing software, who does exactly what. Some bookkeepers end up performing accounting duties and vice versa. If that continues to be the case, some might be completely content in using the terms reciprocally, but those performing the job know the difference.

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