Accounting can be said to be the translation of regular data about financial transactions in the form of reports and providing certainty about financial information that will help managers, investors, tax authorities, and other decision-makers to make resource allocation decisions within companies, non-profit organizations, and government agencies. The result is a better understanding of actual profitability and awareness of cash flow in the business. While bookkeeping is the process of organizing, classifying, summarizing, and reporting accounting elements such as profit, loss, cash flow, in an orderly and orderly manner against recorded transaction data. Aside from that, if you require a bookkeeper who can work by using XERO excellently, we suggest you call Amanda Mckenzie Xero Expert.
That’s why, bookkeeping is still included within the range of accounting, but it posses dissimilar principles. If the accounting activity will produce a financial report or special report and requires professionals in the accounting field because it requires analysis, while bookkeeping will only produce documentation for internal purposes.
A person who works to compile books is called a bookkeeper, while a person who works to record and prepares accounting reports is called an accountant.
The bookkeeper or bookkeeper who is responsible for recording day-to-day business transactions has at least a diploma in accounting. A bookkeeper is required to be accurate in presenting data because the ledger contains detailed information about transactions per day. A bookkeeper must also know about major financial topics. Their works will be monitored by business owners or accountants who own the book that is being processed.
To qualify, an accountant has at least a bachelor’s degree. Accountants should also obtain additional professional certification by taking the Public Accountant Certification Exam. An accountant is generally capable of performing tasks broad enough to even conduct audits, review reports, and represent clients before the IRS. They are required to be thorough, measured, skeptical, logical, consistent, disciplined, and obeying applicable ethics.
The scope of bookkeeping includes;
– Compile, classify, process and also record employee payroll
– Issue and record sales invoices
– Record changes in company inventory
– Recording petty cash receipts and transactions
– Make payments for purchases