Learn the Difference Between Bookkeeping and Accounting in Sunnyvale CA
We have a lot of questions about what exactly a job entails. When applying for a job, we must know what the position is, the nature of the job and the expectations of the employer before we fully commit to it. It is better to know what the job you are applying for entails in order to maximize your full potential.
Most companies hire accountants and bookkeepers to maintain financial steadiness. Whether it be internal or outsourced, these two positions are undeniably important. However, some companies do not realize how crucial these positions are to a business. Here are guides as to whether your company needs to hire both.
Accounting And Bookkeeping Defined
To be able to understand fully, we must first look at the jobs of accounting and bookkeeping.
Bookkeeping is a process of gathering, organizing, keeping and accessing the financial records of the company. Bookkeepers are the ones in charge of making sure that all data is gathered and recorded. They make all records and compile them for the accountant to verify. They are the ones who facilitate the transactions of the company on a daily basis and are expected to make daily internal reports and financial statements. Bookkeeping is the financial blueprint for a business. Bookkeepers follow what the accountants tell them to do.
Accounting, on the other hand, manages all finances from assets to expenditures. Accountants maintain the financial stability of a company by ensuring that all finances are well balanced. They analyze the financial functioning of a business and all its statistics maintaining harmony in the cash flow. They are expected to follow legal rules such as the Generally Accepted Principles of Accounting especially when dealing with taxes and other legal matters involving finances. Accounting is a complex term because it is the backbone of all financial transactions. Accountants give instructions to bookkeepers on what kind of accounting and bookkeeping strategies to use.
Can One Survive Without The Other?
One cannot survive without the other as both roles are interconnected. Bookkeeping is an obligatory subcategory of accounting and both are needed to keep a business going. Accountant’s reports rely on the accuracy of the records of the bookkeeper. Without each other, the financial stability of the company can be in jeopardy. These reports involve financial statements, tax revenues and numerous confidential information given to managers and investors. If the bookkeeper fails to do his job properly, then the accountant can also be dragged down and might put the credibility of a company at stake. Both are of equal importance to a business.
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