Fall in Love with Bookkeeping: What is Bookkeeping?

Welcome to the doorsteps of February! As people show love to family and friends, we want to give some credit to what we do best here. During this blog, we will break down the definitions of bookkeeping and accounting, how services differ, and how they can each benefit you.

Bookkeeping is defined as the systematic recording and organizing of financial transactions in a business. It ensures that records of individual financial transactions are accurate, up-to-date, and comprehensive. Attention to detail, organization, and a clear understanding of the end goal are required.

What services does a bookkeeper offer? A wide range of tasks! Some of these tasks are to record transactions, reconcile statements, oversee financial statements, maintain accounts receivable and payable, and keep updated records.

So what’s the difference between a bookkeeper and an accountant?

According to Accounting Tools, an accountant is “a person who records business transactions on behalf of an organization, reports on company performance to management, and issues financial statements.” Some of the responsibilities include issuing invoices, settling received invoices, overseeing bank statements, issuing wages to employees, and producing financial reports. 

Forbes further describes accountants as being “largely responsible for the financial health of a business. If they notice expenses are going over budget or under budget, they can look into what’s causing this discrepancy and make recommendations to resolve these problems.”

Bench Company gives us the best distinction between the two. “Simply put, bookkeeping is more transactional and administrative, concerned with recording financial transactions. Accounting is more subjective, giving you insights into your business’s financial health based on bookkeeping information.”

Some companies choose to have both bookkeepers and accountants on staff or handle themselves, while others may realize they aren't able to take on both responsibilities themselves. Feeling convinced to have your numbers in order? Contact me today to help get control of your bookkeeping needs!