What is Bookkeeping? Difference of Accounting and Bookkeeping
Before we start comparing the Accounting and Bookkeeping. We must have to learn more about both Business terms. Because without knowing the background and history of these terms. We will not able to conclude the difference between Accounting and Bookkeeping. First We will learn what is Accounting? and then we will go on Bookkeeping?
What is Accounting?
Basically, Accounting is the process of recording Financial Transactions, storing, sorting, retrieving, summarizing it for financial purpose. Accounting also provides Financial reports to the Business owners to make the decision about the future activities of the business. In other words, we can Account Accounting is the broader term from Bookkeeping.
What is Bookkeeping?
Bookkeeping is just recording of the financial transactions of any company activities. In other words, we can say, bookkeeping is the recording of money that has been spent on expenses and received from customers against the sale of products or services.
If you are going to hire a Bookkeeper for Accounting and Bookkeeping Services. So that you can ask relevant questions about both Financial Terms.
Accounting vs Bookkeeping
|Sr . No||Bookkeeping||Accounting|
|1.||Don't have any formal Business education. He has just a training of few months||Have formal Accounting Degree|
|2.||Usually know the day to day Client Business activities.||He always have broader overview on Clients Financial Reports|
|3.||Recording of Financial Transactions like (Journal, Ledger and Trial Balance)||Analysis and Interpretation of Financial transactions|
|4.||No Subdivision of Bookkeeping||Financial, Cost and Management Accounting|
|5.||Bookkeeping Ends||Accounting Start|
After understanding the difference between Accounting and Bookkeeping. The Business owner has clear thoughts about credentials have to provide the Bookkeeper and Accountant when he is going to assign the task for his books.