Bookkeeping vs Accounting
/Bookkeeping and accounting, they’re the same thing right?
Wrong.
They’re linked yes, but they are two different and equally important parts of managing finances.
In our opinion, the two can be defined as follows:
Bookkeeping
The processing and organisation of financial transactions and information.
In it’s most basic form, this includes invoicing, recording receipts and bills and reconciling bank transactions. However, bookkeeping can incorporate other tasks like payroll, credit control and supplier payments.
Accounting
Analysing the data and processing reports using the information collated during the bookkeeping process.
This covers the statutory reporting like annual accounts, VAT returns and Corporation tax, but also incorporates advisory reporting like management accounts, KPI analysis and cashflow forecasting.
Put bluntly, if the bookkeeping is rubbish, or not kept on top of, then the accounting is going to be more difficult, take longer and not produce timely reporting.
With this in mind we promote and carry out real time bookkeeping using cloud software and automation to make the process as slick and smooth as possible.
This makes the statutory processes much more straight forward and the advisory reporting possible.
If you’re not getting this service from your accountant/bookkeeper then you should be!
