Many people assume that bookkeeping and accounting are one and the same, but the fact of the matter is that the roles of each of these professionals are actually quite different. Understanding what each professional does and what that means for your business is crucial to your success. You can’t manage your business finances entirely on your own, after all, and you will have a place for both a bookkeeper and an accountant on your payroll, even if you only outsource bookkeeping and accounting services when you need them.
A bookkeeper is someone who handles the day-to-day financial records of your business. They assist with recording and performing transactions, as well as balancing accounts and generating payments, along with other daily financial tasks. They may also be responsible for preparing reconciliation reports, managing accounts payable and receivable, and processing invoices and other financial transactions.
In some small businesses, a bookkeeper may also act as the sole individual responsible for maintaining and processing the payroll for all of the employees. They may handle the creation and management of various accounting and financial review systems in your business, as well, in an attempt to streamline things and make their own efforts simpler. Ultimately, their role is in the ongoing management and maintenance of the finances of your business.
The accountant is the one who takes more of a managerial or overarching role in your business finances. They will monitor and analyse the data that was created by your bookkeeper and generate reports for you. Along with those reports, they will be able to provide advice on your financial matters. In addition to this, accountants are the ones best suited to handle all of the matters related to business taxation. From yearly tax preparation to tax duties and requirements throughout the fiscal year, they are your go-to person to make sure that everything is done by the book.
Your accountant can assist with establishing the business, auditing, corporate compliance, financial management advice and assistance, and other related duties. Ultimately, their role is taking a more analytical approach, offering consulting and advisement services in addition to a host of other financial services.
Which Do You Need?
As mentioned previously, there are benefits to be had from employing the services of both bookkeepers and accountants, and each for their own reasons. Rather than looking at it as an “either/or” situation, consider how you can put each to use to help your business grow and find better financial solutions. Figure out how you can employ a team that will work together for the benefit of your business. Sometimes, one of the best options here is to adopt virtual bookkeeping services that can give you a comprehensive solution to your business finance needs.
The benefits of outsourcing are plentiful. You will be able to find all of the bookkeeping and accounting services that you need in one place so that you can keep everything streamlined. Plus, you will trust that your financial matters are handled and be able to put them out of your mind so that you can focus your efforts elsewhere. Perhaps one of the most attractive benefits, of course, of outsourcing, is the financial benefit. Outsourcing costs a lot less than hiring someone and retaining their services or adding a bookkeeper or accountant to your business payroll.
Wrapping Up
Now that you understand more about accounting and bookkeeping services for your business, you’ll be in a better position to make the best decisions for its financial future. Hire a bookkeeper to manage things on a day-to-day basis and an accountant to oversee everything, offer advice, and handle your taxes. Then, your business will be set.