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This question is about what an accountant does.
Bookkeeping vs. Accounting
Bookkeeping is a practice that focuses on recording and organizing financial information, while accounting is the interpretation and presentation of that financial information for business owners and investors.
Bookkeeping generally consists of recording financial data that involves payroll, invoices, receipts, and bills, and the recording of business transactions. Bookkeeping is essential to an individual or company's accounting.
Accounting uses the financial data from bookkeeping to organize and prepare certain items for an individual or company. These include financial statements and reports, budgets, tax returns, and analysis of business performance.
Here are the key differences between bookkeeping and accounting:
| Bookkeeping is a practice that focuses on recording and organizing financial data. | Accounting uses the financial data obtained from bookkeeping to execute accounting tasks. |
| Bookkeeping gets its financial data from payrolls, invoices, receipts and bills, and recording business transactions. | Accounting consists of creating financial statements and reports, budgets, tax returns, and analyzing business performance. |
| Bookkeeping is general a micro-view of an individual or company's financial activities. | Accounting is generally a macro-view of an individual or company's financial activities. |
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