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Bookkeeping vs. Accounting
Job descriptions aside, we all know that Bookkeeping and Accountancy are integral to every well-functioning and successful business, but what are the main differences between the two professions, and how do you know which you would prefer?
There are a few key differences between bookkeeping and accounting that you should be aware of.
Bookkeeping is an essential skill required by almost every company due to the fact that every business is obliged to record their incomings and outgoings in the form of ‘books’. It is the role of the bookkeeper to ensure that these transactions are collated and recorded in order to ascertain how much money is going in and out of the company’s bank account.
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Common tasks and day-to-day duties of Bookkeepers include:
Receiving and processing sales invoices and receipts for payment
Drafting statements to show income and payments.
Processing the company payroll
Calculating profit and loss
Estimating revenue and expenditures
Managing ledgers, and ensuring that the books ‘balance’
Preparing annual accounts
Providing general administrative support to the accountant
Examples of the various financial records that you will be responsible for maintaining include.
Sales ledgers
Purchase ledgers
Journals
Bank reconciliations
Invoices
Statements
Remittances
From payroll to invoicing, Bookkeepers are responsible for keeping a complete record of every financial transaction within a business; whilst ensuring suppliers, staff members and other third party organisations are all paid on time.
The Bookkeeper’s organisation is integral to the successful day-to-day running of the business, and without the development of their accounting systems, business processes would quickly fall apart.
In contrast, the role of the Accountant is to build on the financial records provided by the Bookkeeper, in order to create a complete financial picture of a business, and analyse its profitability.
From the accurate filing of taxes to implementing cost-saving changes, Accountants are called on by Business Owners to really crunch numbers, and develop a financial strategy that will help the business grow and succeed.
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Accountants frequently find work within the following areas:
Financial reporting
Management accounting
Accounting systems and processes.
Taxation
Forensic accounting
Auditing
Corporate finance
Business recovery and insolvency
Below are a few examples of the day-to-day tasks of an accountant:
Managing a company’s financial systems and budgets
Undertaking financial audits
Providing financial advice to support company decisions
Advising clients on issues relating to tax
Maintaining accounting records for all business activity
Detecting and preventing fraud from taking place
Producing financial reports and recommendations
To become a Bookkeeper you don’t necessarily need a degree in mathematics, but you do need to undertake a Bookkeeping training course or accreditation.
The Institute of Certified Bookkeepers (ICB) is the largest Bookkeeping association worldwide and prides itself on increasing the recognition of bookkeeping as an integral part of the financial profession, whilst maintaining the standards of bookkeeping through consistent training, development and qualifications.
e-Careers has established an excellent working partnership with the ICB and is an accredited training provider of several ICB accredited courses that will aid aspiring Bookkeepers in advancing their career, including:
The ICB is the largest bookkeeping institute in the world and its qualifications are globally recognised and highly regarded among employers.
Again, to become an Accountant you do not necessarily need a degree, but you do need to have a strong interest in numbers with A-Levels or similar in Maths and Economics, for example.
From here, there are many qualifications aspiring Accountants can choose from – but all developing professionals will need an AAT Qualification as a minimum requirement.
The AAT or Association of Accounting Technicians is the UK’s leading qualification and membership body for vocational accountants. The organisation prides itself on providing qualifications that meet the needs of aspiring professionals and business owners, and currently awards 90% of all vocational qualifications in Accountancy.
Examples of the AAT Accounting eLearning courses provided by e-Careers include:
For more information on becoming an accountant check out our article exploring 5 ways to become an accountant.
Studying a bookkeeping or accounting course with a reputable training organisation like e-Careers, where you can gain the knowledge and qualifications required to enter the industry is a highly flexible and cost-effective route into your new career. View the full range of courses currently offered by e-Careers.
In terms of the salary that you can expect as an accountant, this depends on your level of experience and where you are in the UK. The starting salary of an accountant in the UK may be anything from £20,000 to £30,000, depending on your location and the type of firm you are working for.
It can take between three and seven years to become a chartered accountant, for which the average salary is £85,000 per annum, with an average yearly bonus of £17,000. The salary of a bookkeeper usually varies between £16,688 and £33,513 throughout the UK depending on location. If you decide to progress your career by becoming an accountant, you find that your salary will increase. A self-employed bookkeeper can expect to set their own hourly rate.
If you’re interested in carving out a new career in Bookkeeping or Accounting and feel you would benefit from the flexibility of eLearning, please contact one of our dedicated AAT Course Consultants today on +44 (0) 20 3198 7700.
