Date posted: Wednesday, February 18, 2015
We find that all businesses are the same: they want to get on with what they do best: serving their customers and making money. Managing their finances and doing tax is the last thing on their mind.
So while outsourcing these kinds of services is usually necessary, there’s often some confusion about what the business actually needs – Bookkeeping or Accounting? Neither? Both?
Bookkeeping is more about the day-to-day of a business’ financials, keeping records of transactions efficiently and consistently. In a lot of ways, good Bookkeeping prepares relevant documents for an Accountant, and for tax time. Their tasks can include:
- Recording financial transactions
- Posting debits and credits
- Managing accounting software and keeping it up to date
- Maintaining and balancing legers and historical accounts
- Completing payroll
- Sending out, paying and chasing up invoices
On the other hand, Accounting is a higher-level process that uses the compiled information to make financial models and look at the business with a wider, strategic perspective. Within Accounting itself there are additional specialisations but in broad terms Accounting includes:
- Preparing financial statements
- Analysing cost of operations
- Completing tax returns
- Working with the business to help them understand financial decisions
Often, a small to medium-sized business (SME) will actually need services from both professions – but you’d be surprised how few people can help. Bookkeepers, while important, only really do half the work you need done, while Accountants require your financials to be at least somewhat organised before they can get to work.
Luckily, our team at Pakenham Tax + Accounting can do both, all under the one roof. We’re experts at both the nitty gritty of Bookkeeping as well as all Accounting and Tax services you might need.
If you need help with managing your personal or business bookkeeping and accounting, don’t hesitate to get in touch.
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