Does your business need an accountant? Or a bookkeeper? Or both?

To make the best decision about where to invest your administration budget for your business, it’s important to understand the difference.

Bookkeepers and accountant's both share some common goals – primarily, they both work to ensure your financial record-keeping is compliant, accurate and secure. But there are some important differences between the roles and understanding them will make the way you approach how to work with them in the most efficient and cost-effective way.

What Does A Bookkeeper Do For My Business?

The fact is, not every business engages a bookkeeper.

Another fact? They probably should.

Unless you come from a financial background, with a clear understanding of numbers and how getting them right helps your business operate more smoothly, making the decision to invest in a bookkeeper for your business can free up your valuable time and allow you to focus on what you actually do best – providing the services/products your business delivers to its clients and customers.

Bookkeeping is the process of recording every financial transaction in a way that is consistent and accurate – a main ingredient in the foundation of a strong business.

Bookkeeping includes:

• Documenting financial transactions
• Logging debits and credits
• Creating invoices
• Doing payroll
• Reconciling accounts

Today, with the convenience of cloud-based accounting software packages putting basic bookkeeping skills into the hands of any business owner with a subscription to a software package, the lines between bookkeeping and accounting have become a little blurry but the basic duties are all to do with clarity of record-keeping and management of the daily financial transactions that keep your business running.

What Does An Accountant Do For My Business?

Accounting is about more than merely documenting the financials – it’s about making sense of them.

While bookkeeping is mostly transactional, the business of accounting is more subjective and includes:

• Preparation of company financial statements
• Analysis of operational costs
• Completion of income tax returns
• Assessment and explanation of the true impact of financial decisions

In the post-GST business world, lodging BAS statements is an important part of professional financial management and compliance. Some bookkeepers are registered BAS agents and can do this task for you each quarter but it’s important to remember that it does require a particular industry accreditation that not all bookkeepers hold. Your accountant can also do this for you.

Make Sure They Talk To Each Other

An honest and open communication between your bookkeeper (even if it is you) and your accountant will help the success of your business in the long-term. Understanding what your accountant needs your business’s booking duties to be will help you deliver the information your accountant needs from you – and can, potentially, save you money on accounting fees too.

Investing In Your Business

If you hire a bookkeeper, it is an investment of your money. If you make a decision to absorb bookkeeping duties into your life as a business owner, it is an investment of your time Make sure you weigh up the real cost of your decision – and choose the option that helps the future growth of your business.