Term: Bookkeeping vs accounting
What is the difference between bookkeeping and accounting?
Bookkeeping and accounting are both important parts of managing your finances. At first glance, the two can seem quite similar, but there are a few main differences. Bookkeeping focuses on recording and organising financial data. Accounting is the interpretation and presentation of that data to business owners and investors.
Bookkeeping typically consists of:
receipts and bills
recording business transactions
Accounting typically consists of:
financial statements and reports
analysing business performance
The tasks that bookkeepers and accountants do vary between businesses. Bookkeepers working for smaller businesses might do some basic accounting duties. There’s often overlap, and the duties may change a lot from one business to another.