If you are using (or looking to use) someone to record your transactions, you are working with a bookkeeper. If you want someone to provide business insights based on your recorded transactions, you are looking for an accountant.
Bookkeepers are the detail-minded, organized support staff that lay the foundation of information for your business. They produce your invoices, record and pay your bills, manage inventory, maintain and balance your journals and ledgers. They will even enter, track and produce your payroll. They do not necessarily have a college degree but they have inquiring minds and enjoy working with numbers. A Bookkeeper is not to be taken lightly!
Accountants are the ones that take the information that a Bookkeeper has painstakingly gathered and produces models and insights of where your business has been, where it is, and where it can go. They will prepare your financial statements, analyze your costs, and help with strategic planning. They usually hold a degree, have inquiring minds and enjoy working with numbers. They may also acquire additional certification such as becoming a CPA (Certified Public Accountant) or an Enrolled Agent. Accountants are ever so useful!
While the difference between the two may seem small and interchangeable, each are no less important than the other. Together they create a great team that will help make your business grow.
Why do you need a Bookkeeper? Short answer: To save your sanity. Saving your pocket is the cherry on top.
Longer answer: Because trying to do everything yourself is the quickest way to crash and burn by being overwhelmed with details alongside the pressures of creating and running your own business. On top of that, without the knowledge that an experienced bookkeeper has or simply not having the time to spend thinking about your books, it is easy to make the mistakes that will undercut your plans and resources. Which ends up costing you more.
Here is what a good Bookkeeper will do for you:
They will save you time. Time to think about how to build your business or overcome a certain challenge. They will also create time for you to rest and recharge when you are supposed to.
They will save you money. No more late fees, unnecessary bank charges, avoidable tax penalties. They will be more efficient and more knowledgeable. They will get things done quicker and reliably.
They will keep your debits and credits straight and in all the right places. While QuickBooks and other similar accounting packages have made bookkeeping easier for someone who has never studied bookkeeping or accounting, they do not let you know if you are following GAAP or IFRS correctly. For example: When does a payment go on the Balance Sheet and not the Income Statement? When is an expense not an expense?
They will also create financial and management reports for you. Reports that provide cashflow forecasts, job costs, and selling trends. You will not run your business “blind” but you will be able to make sound business decisions with the trustworthy information presented to you.
Finally, they will be your cheerleader. They want you to succeed and will do everything they can to help you do just that.
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