What’s the difference between a bookkeeper and an accountant?

I often get asked “What is the difference between a bookkeeper and an accountant?”. It can be confusing for clients if they think they need an accountant when they actually need a bookkeeper, and vice versa, so it helps to understand the tasks that each role performs.

As a bookkeeper myself, I can explain the difference between the two, and help business owners understand who they should be calling on to help them with their business finances.

What does a bookkeeper do?

All businesses generate a lot of paperwork, such as purchase invoices, receipts and expense claims. A bookkeeper’s focus is to transform the paperwork of the financial transactions of a business into something more orderly and accurate, maintaining them in a software system such as Xero or QuickBooks. They support the business by paying bills and chasing invoices for payment. Some bookkeepers also prepare VAT returns, run payroll, prepare and file self-assessment tax returns.

Most bookkeepers operate as a stand-alone service. In some ways it’s like having your own part-time finance person, but you are not responsible for their employment (remember that they will need to take holidays and are often juggling their workload for other clients).

What does an accountant do?

An accountant’s focus is related to a higher level compliance, such as filing accounts and tax returns, and to advise the business owner on the strategic management of their business. Good accountants can act as part of the team by being a sounding board for your ideas, or by helping business owners build relationships with other trusted service providers. Accountants’ expertise will mean that they will conduct regular tax planning so that business and personal tax liabilities are minimised, and they can provide advice on cash flow management.

So, what’s the difference?

In essence, a bookkeeper will work on your books weekly, fortnightly or monthly. How often, will depend on the size and complexity of your business, and also how up to date you need and want your financial records to be.

Whereas an accountant will generally work at less frequent intervals, perhaps quarterly to produce VAT returns or yearly to create annual accounts. In addition, they could be involved on more specialist projects at certain times, for example to work on a business plan or cash flow forecast.

To discuss further what challenges you face and what we can do for your business why not have a complimentary 30-minute discovery call.


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