Small businesses often ask, “Do I need an accountant or a bookkeeper?”. The answer is normally, “both”.
Accountants & Bookkeepers have some overlap in what they do… they both might do the payroll, they both might do the VAT returns… but then the accountant does higher level activities than a bookkeeper. I always compare it to a Doctor and a Nurse. A nurse can do a lot of what the doctor does… but a doctor (like an accountant) is more qualified.
But bookkeepers and accountants, essentially do different things and have very different roles to play in helping businesses to manage their finances properly.
Bookkeepers charge far less for their time. Far less. That’s is a principle difference between a bookkeeper and an accountant. Therefore, it makes sense to get a bookkeeper to do as much of your work as they can. Bookkeepers record the financial transactions of a business and present them in a neat and orderly format – which could be on accounting software such as Sage, Quickbooks, MYOB, MyCake or on a spreadsheet. This information is then used to complete the VAT figures.
Bookkeepers tend to work on-site, with their sleeves rolled up and as a result, they’ll spend more time with your business and really get to know how it ticks. They are more down to earth, and tend not to speak in jargon, and so can tell you plainly – what the figures say.
Some will take over the task of credit control - chasing customers for payment. It is always better to have a different person trying to sell a service, from the person collecting money.
Accountants do not normally want to provide an ON SITE bookkeeping service. What they do best is to take the figures from the bookkeeper and then complete the year-end accounts and other formalities. They will advise you on exciting things like ‘succession planning’ and ‘exit routes’ and how to ‘save on tax’.
The best advice, as in most other matters, is to make sure that you use the correct person for the job. Both bookkeeper and accountant should be qualified and be up to date in best practice in their respective professions so that you can rest assured knowing that your business is in safe hands.
Above all, make sure your bookkeeper and accountant talk to each other and get on with each other. They should be in agreement over the best accounting system for your business.
Contact Boogles, for a good bookkeeper.
The responsibilities of a bookkeeper and an accountant are usually interchanged by most. An accountant has a broader scope of tasks and can actually do those of a bookkeeper. But as how the old saying goes… “Two heads are better than one.” The burden of handling the tasks can be lessened if they work with each other. That can, in turn, improve the flow of finances in the company.
ReplyDeleteLenora Morgan
For business owners, it wouldn’t hurt to hire both. It’s best to make good use of their respective specializations to ensure the accuracy of your books and records. Their services will be worth the additional cost. After all, maintaining the constant flow of resources is important in a business.
ReplyDeleteDarcy Grubaugh
For that frequently asked question, I say: Hire an accountant for the accounting, hire a bookkeeper for the bookkeeping. However, a small business owner could just learn bookkeeping functions and do it by himself as this doesn’t necessarily require a degree in accounting. Plus, by entering bills, processing payroll data, preparing invoices and other bookkeeping functions by himself, a business owner could cut his expenses.
ReplyDeleteParris Moretti
That's right, Parris. If you have a small business, hiring a bookkeeper is the best option for you. Their skills and knowledge in handling your financial accounts and transactions will be very helpful for you. On the other hand, if you need someone to audit your taxes and transactions, then, that would be handled by your accountant.
ReplyDeleteJeanie Yearsley
Hey there, if you wish to change your software or confused in choosing the software for accounting, finance management, and bookkeeping, then you can look at our detailed comparison of Quicken vs QuickBooks on our website
ReplyDelete