When it comes to starting a bookkeeping business, it’s important to know the difference between a bookkeeper and an accountant. Both positions are integral to the financial health of any company, but they do different jobs and have different qualifications.
What is a Bookkeeper?
A bookkeeper is responsible for recording and organizing a company’s financial transactions. This includes everything from sales and purchases to incoming and outgoing payments. Bookkeepers use accounting software to track this data, and they make sure that all the information is accurate and up-to-date.
Bookkeeping is important because it provides a clear financial picture of a business. This information can be used to make important decisions about where to allocate resources and how to grow the company.
Most bookkeepers have at least a high school diploma, although some bookkeepers may have an associate’s degree or certificate in bookkeeping or accounting. Many bookkeepers also become certified through professional organizations such as the American Institute of Professional Bookkeepers (AIPB) or the National Association of Certified Public Bookkeepers (NACPB).
The median annual salary for bookkeepers was $45,000 in May 2022, according to the U.S. Bureau of Labor Statistics (BLS).
What Is an Accountant?
An accountant is responsible for analyzing and interpreting a company’s financial data. This information is used to prepare financial statements, advise on tax compliance, and provide other decision-making support.
Accountants are important because they help businesses make informed decisions about their finances. They can also identify areas where a business is losing money and make recommendations for how to improve the bottom line.
Most accountants have at least a bachelor’s degree in accounting or a related field. Many accountants also become certified through professional organizations such as the American Institute of Certified Public Accountants (AICPA). You must be licensed to practice as a certified public accountant (CPA) in most states.
The median annual salary for accountants was $52,000 to $73,000, according to the U.S. Bureau of Labor Statistics (BLS).
Bookkeepers and accountants both play important roles in the financial health of a company. Bookkeepers are responsible for recording and organizing a company’s financial transactions, while accountants are responsible for analyzing and interpreting this data to provide decision-making support.