Bookkeeping vs. Accounting: What’s the Difference?

You might wonder how bookkeeping vs. accounting differs when managing a business’s accounting. While they are overlapping disciplines, there are some key differences. Bookkeepers are chiefly responsible for accurately recording and organizing transactions, while accountants add value by synthesizing that information into actionable insights and financial projections. 

In other words, bookkeepers are tacticians, and accountants are strategists. 

This article will help you decide when and if you need to bring one of these professionals on board in your business. 

As you scale your business, indinero’s online bookkeeping and accounting services are here to support you. We’ll handle the financial details at a fraction of the cost of a full-time employee so you can focus on growing your operation.

What Does a Bookkeeper Do? 

Bookkeepers track and organize business transactions. You’re probably familiar with the duties; most small business owners have acted as their own bookkeepers at some point.

After a business chooses a legal entity, such as an LLC or sole proprietorship, bookkeepers segregate personal and business financials and implement a method for tracking business expenses. Since every expense is a potential business tax deduction, bookkeepers have strong attention to detail and aim to record and categorize every transaction accurately. 

Entrepreneurs may choose the DIY route at first, perhaps beginning with a simple spreadsheet. As a business grows, a professional bookkeeper will use software that automatically records and organizes cash flowing in and out of business accounts.