It is a common misconception that accounting and bookkeeping are the same. The terms are even often interchanged with one another. But although both works to assist you with your finances, there are definite distinctions among the services that bookkeepers and accountants provide. Tax services, for example, are more appropriate for accountants. So if you need tax services in Kearny, NJ, look for an accountant that you can trust. The important thing to remember, though, is that both are crucial for your business to operate smoothly. And while they may have some tasks that overlap, there are aspects of your business that you would entrust to an accountant, and others that you would entrust to a bookkeeper.
So what differentiates them from each other?
Bookkeepers
Simply put, bookkeepers maintain complete records of all the money that has come in and out of your business. It is their job to record daily financial transactions in a consistent and easy-to-read way. Their records are later on used for accounting services. In Kearny, NJ and the rest of the world, bookkeepers work hand in hand with accountants to provide precise financial records for your business.
One of the major tasks of a bookkeeper is maintaining a general ledger. Every single one of your business sales and purchases should be recorded in the ledger.
Here are some of the tasks that bookkeepers do:
- Keeping Financial Transaction Records
- Posting Debits and Credits
- Creating Invoices
- Managing Business Payroll
- Maintaining and Balancing Accounts, Ledgers, and Subsidiaries
Accountants
Accounting is a more complicated process that uses financial information compiled by a business owner or a bookkeeper to produce financial models. Accountants provide crucial business insights and financial advice for business owners based on their financial records. Accounting is a high-level process that produces reports that give you a complete picture of where you stand financially. Using this, your accountant can help you understand what you can and should do about your situation and how you can expect your business to grow soon.
You should also note, however, that an accountant is not the same as a Certified Public Accountant. If you are hiring someone to do your tax returns, it’s better to choose a CPA because they can prepare your tax returns and represent you before the IRS if ever you’re audited. Accountants can only prepare tax returns but cannot represent you. You should also remember that accountants and CPAs can also do bookkeeping. So if you are looking for someone who can provide you the whole set of services, hiring a CPA is your best bet.
Here are some of the tasks that accountants do:
- Preparing Adjusting Entries
- Analyzing Costs of Operations
- Helping Business Owners Understand the Impact of Their Financial Decisions
- Preparing Company Financial Statements
- Completing Income Tax Returns
If you ever need accounting or tax services in Kearny, NJ, hire Nicholas J. Coco, CPA. With him, your business will be in good hands. Call us today or browse through our website to know more about our services.
