CPA Near Me: Difference Between an Accountant and a Bookkeeper
CPA Near Me
CPA Near Me | Accounting and bookkeeping are fundamental functions of any business. The tasks associated with these two functions are often used interchangeably. Hence, many businesses cannot decide between choosing an accountant or a bookkeeper to work with.
Once you have a clear idea of the role of an accountant (CPA Near Me) and a bookkeeper, you’ll be able to work smoothly with both of these professionals. In summary, a bookkeeper sets the foundation for the work of an accountant, which in turn builds the finance function of a business.
What is a bookkeeper?
Bookkeeping is the process of recording every financial transaction of a business. Hence, a bookkeeper maintains the financial records by recording every financial transaction of a business.
The financial records maintained by a bookkeeper include:
- Income and Expense entries
- Account receivables and payables
- Invoices, payments, and cash receipts
- Tax records
Moreover, the list of a bookkeeper’s tasks can be stretched depending on the nature and complexity of the business. In short, a bookkeeper’s tasks include every transaction that affects the financials of a business in any way.
What is an Accountant?
Accounting is the process of organizing, interpreting, and utilization of financial information of a business. Thus, an accountant organizes, interprets, and presents the financial information of a business.
Thus, an accountant, or CPA Near Me, records, classifies, and presents the data into an information form for the business managers. In other words, an accountant turns the financial data provided by a bookkeeper into useful financial information.
Services offered by a Bookkeeper for a Business
As we discussed above, a bookkeeper sets the foundation of the finance function of your business. Thus, it’s important to work with a qualified bookkeeper to take full advantage of the time and money spent. Also, it will create a strong finance function for your business.
Bookkeeping is the process of documentation of all financial transactions of a business. Consequently, these transactions start before launching the business activities and would end after closing the business formally. Thus, a bookkeeper would maintain a comprehensive financial record of your business from start to finish.
Consequently, in most jurisdictions, a double-entry accounting format is used. However, a bookkeeper can use a single-entry accounting method as well. For this reason, and IRS tax compliance, a double-entry accounting method is advised.
Services offered by an Accountant for a Business
An accountant, or CPA Near Me, builds on the work of a bookkeeper. The primary role of an accountant is to turn bookkeeping records into valuable accounting information. Therefore, this information can be in the form of summarized accounts, reports, or documents.
In addition, bookkeeping remains a pivotal part of the accounting function. Thus, an accountant covers the financial function of a business comprehensively including the bookkeeping records.
Some of the top services offered by an accountant include:
- Preparation of trial balances
- Preparation of financial statements
- Close-out reviews and reconciliation
- Payroll management
- Tax preparation and filing returns
- Analysis of accounting records
- Forecasting, budgeting, and cash flow analysis
- Accounting and auditing services for a business
In other words, the services offered by an accountant would also depend on the qualification and experience of the professional. For instance, if you work with a CPA Near Me, you’ll receive comprehensive services including audit representation, financial planning, and business consultation.
What are the Key Differences and Similarities?
In short, many of the basic services offered by an accountant and a bookkeeper are similar. For instance, both professionals offer record-keeping, accounting entries, payroll, cash flow entries, bank reconciliation, and so on.
Lastly, let us summarize the key differences between an accountant and a bookkeeper’s role for you.
|Recording, measuring, and maintaining the financial records
|Classifying, categorizing, and interpreting the accounting records
|Provides data for accounting records
|Builds on the bookkeeping data
|Bookkeeping records are in the form of data
|Accounting records are in the form of summarized financial information
|Assists in accounting records
|Assists in financial decisions making process
|Concerned with the fundamentals of finances for a business
|Concerned with complex financial needs of a business