What are they key differences between accounting and bookkeeping?
What are they key differences between accounting and bookkeeping?
bookkeeping and accounting both fall under the accounting umbrella, the
biggest differentiator is bookkeeping doesn’t involve the analysis of
Accountants form an integral part of any business by ensuring all fiduciary responsibilities are adhered to. Basically, an accountant will analyse all financial transactions
evident in statements and business reports, ensuring that they meet all
necessary accounting standards and principles. Using the financial
analysis, accountants are able to provide a full report on the financial
performance of any business, empowering business owners to make
informed financial decisions.
will have many day-to-day activities to meet all financial needs but
there are four main accounting duties in any organisation:
- Financial analysis and consultation
company’s financial data will be assessed and advice shared on the
correct measures to be taken to ensure financial stability and growth.
- Data management
accountant is responsible for the storage and management of all
financial data, constantly researching new techniques and products for
effective data storage, then updating where necessary. An accountant has
the final say on which accounting system will be used within a business.
- Compiling financial reports
All necessary SARS-related business reports and statements will be compiled by the business’s accountant.
- SARS regulatory compliance
There are constantly new tax regulations and tax procedures
that need to be followed to ensure a business is SARS compliant. An
accountant is responsible for maintaining communications with SARS, and ensuring the business is up-to-date with all tax requirements.
How to qualify to be an accountant
Becoming an accountant requires more than just having a good idea of how everything works. To qualify as an accountant, the minimum requirement is attaining a Bachelor’s Degree in accounting or related field, but there are many more levels beyond this. In South Africa, an accountant will ideally have completed a Bachelor of Commerce followed by a three-year-learnership at a SAIPA-accredited training centre. This is followed by a SAIPA Professional Evaluation exam which is a four-hour competency exam.
Becoming a Chartered Accountant
(CA) requires further qualifications and these positions are generally
found in the commerce, industrial or non-profit sectors. A CA will
undergo more training than an accountant including an academic
post-graduate programme followed by at least three years under a
mentorship. The work’s focus is generally the provision of accurate
records of all financial transactions for an individual or business.
doesn’t require the same level of qualification as an accountant;
however bookkeepers are still responsible for the financial aspects of a
business such as monitoring the chronological order of all financial
transactions, as well as summarising financial data in reports.
Fortunately, there are a number of software options available to assist
with bookkeeping these days.
on the particular company or industry, a bookkeeper’s duties will vary,
but there are certain elements that could be associated with the job
description. These include:
- Maintaining best bookkeeping practices and ensuring compliance with the company and SARS
- Maintaining records and all backup data
- Training staff on all bookkeeping activities
- Developing credit and debit accounts
- Assigning expense categories
- Entering income and expense information into bookkeeping software
- Payments in the form of cash
- Handling of banking activities such as new deposits
- Recommending and managing accounting software, bookkeeping policies and procedures
- Checking the accuracy of information
- Balancing accounts
financial discrepancies and assisting with company auditsProviding
assistance to the accountant for duties such as payroll
How to qualify as a bookkeeper
an accountant, a bookkeeper will not need a tertiary education, rather a
matric or equivalent will suffice for a job in bookkeeping. However,
the best way to succeed as a bookkeeper is by completing a course, of
which there are many available. For entry-level bookkeeping positions,
there is often no previous experience needed, although knowledge of
standard bookkeeping practices and bookkeeping software will be
necessary. Certain organisations might be looking for candidates with
either experience or a relevant Bachelor’s Degree.
What are some of the similarities of bookkeeping and accounting?
the untrained eye, bookkeeping and accounting appear to be the same
profession – or extremely similar at the very least. And while this is
not completely correct, there are some overlaps between accounting and
bookkeeping. Both job descriptions:
What are some of the differences between bookkeeping and accounting?
of the main differences between bookkeeping and accounting is that
accounting involves the analysis and interpretation of financial data
while bookkeeping does not.
- Bookkeeping includes financial
record-keeping, which is the basis of accounting, while pure accounting
includes the use of these financial records for report preparation and
- A basic understanding of accounting is
qualification for a position in bookkeeping while tertiary education and
a higher level of expertise are needed for accounting.
Advantages of bookkeeping for a business
There are many ways that bookkeeping can assist a business. These include:
- Sars compliance
can be assured that they’re meeting all legal obligations by recording
and tracking the income and expenses, as well as paying the correct tax
amounts on time.
- Business accountability
Through the process
of bookkeeping, businesses are able to keep on top of all transactions
as well as pick up any transgressions swiftly. This ensures complete
- Internal control
bookkeeping software, business owners are able to pick up on fraudulent
activity within the company themselves rather than relying on a
- Improved investment opportunities
Bookkeeping allows for improved transparency which makes securing investment from other organisations much more likely.
- Informed decision-making
bookkeeping, business owners have access to hard data on the business’s
financial position. This allows business owners to make informed
decisions for enhanced business growth.
Although there is a
distinction between bookkeeping and accounting, smaller organisations
might require bookkeepers to perform accounting duties and vice versa.
With the support of high-quality bookkeeping and accounting software, the job duties can be administered to with much more ease and efficiency.
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