accounting

When most people think about bookkeeping and accounting, they would be hard-pressed to describe the differences between each process. While bookkeepers and accountants share common goals, they support your business in different stages of the financial cycle.

Accounting is the process of recording financial transactions pertaining to a business. The accounting process includes summarizing, analyzing and reporting these transactions to oversight agencies, regulators and tax collection entities.

Bookkeeping is more transactional and administrative, concerned with recording financial transactions. Accounting is more subjective, giving you business insights based on bookkeeping information.

In this guide, we’ll explain the functional differences between accounting and bookkeeping, as well as the differences between the roles of bookkeepers and accountants.

In the simplest of terms, bookkeeping is responsible for the recording of financial transactions whereas accounting is responsible for interpreting, classifying, analyzing, reporting, and summarizing the financial data. Bookkeeping and accounting may appear to be the same profession to an untrained eye.

Small-business owners are often busy trying to deliver the best-quality service and products, leaving them less time to maintain their finances and accounting. Many of these companies can benefit from business accounting services, and that’s where we come in. BFW provides bookkeeping and accounting services, taxes, financial reporting, budgeting and more…

Below you’ll find a more detailed description of all of our bookkeeping and accounting services for small businesses. You’ll find that our talented staff of online accountants for small-business owners can manage all of your needs, so you can spend more time focusing on other aspects of your business.

The Function Of Accounting – Accounting is a high-level process that uses financial information compiled by a bookkeeper or business owner, and produces financial models using that information.

The process of accounting is more subjective than bookkeeping, which is largely transactional.

Accounting is comprised of:

  • Preparing adjusting entries (recording expenses that have occurred but aren’t yet recorded in the bookkeeping process)
  • Preparing company financial statements
  • Analyzing costs of operations
  • Completing income tax returns
  • Aiding the business owner in understanding the impact of financial decisions

The process of accounting provides reports that bring key financial indicators together. The result is a better understanding of actual profitability, and an awareness of cash flow in the business. Accounting turns the information from the ledger into statements that reveal the bigger picture of the business, and the path the company is progressing on. Business owners will often look to accountants for help with strategic tax planning, financial forecasting, and tax filing.

 

Bookkeeping VS Accounting Summary

Bookkeeping

  1. Recording and categorizing financial transactions

  2. Posting debits and credits

  3. Producing and sending invoices

  4. Maintaining and balancing subsidiaries, general ledgers, and historical accounts

  5. Completing payroll

  6. Recordkeeping

Accounting

  1. Balance Sheet, Profit and loss, Cash Flow 

  2. Completing income tax returns

  3. Financial analysis and Financial Ratios

  4. Tax strategy and tax planning

  5. Financial planning and budgeting

  6. Financial forecasting

Your Holistic Wealth is our Business.

If you find yourself in need of an Accountant, contact us!

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Why Choose Us

Accurate Record Keeping

Always On Time

Time management is very critical to us and we deliver based on your schedule.

Hard Working

We try harder to maximize your returns and we use the tax laws to our advantages.

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