If you’ve got a knack for numbers, you may have considered a career in accounting or bookkeeping. But what is the difference between the two career paths, and why might you choose one over the other?
The responsibilities of a bookkeeper
Bookkeepers record organisations’ financial transactions, including purchase invoices, bank transactions, and sales invoices. The role also includes keeping a log of all transactions in the day books.
Bookkeepers complete double entry, recording the debits and credits, and ensuring that the accounts balance using a trial balance.
Another key responsibility is providing a range of information in report format, such as day books, nominal analysis reports, and aged debtor reports.
The responsibilities of an accountant
Accountants adjust the entries made by bookkeepers at the end of each financial period, to ensure that they follow the relevant accounting concepts, principles, and rules.
They use the trial balance to create the financial statements, including the profit and loss and balance sheet reports.
Accountants provide complete reports, and analyse the cost of operation. Based on these reports, they assess whether the company is profitable, as well as its individual products and services. They then use this information to help managers and directors make informed business decisions.
Which is for you?
If you love working with figures (or ‘number crunching’, as some call it), then you might enjoy being a bookkeeper.
Bookkeepers support businesses by creating an accurate picture of financial activity, which means that they must be highly organised and efficient, be able to focus on numerical data for long periods of time, and have excellent attention to detail. If this sounds like you, a career in bookkeeping might just be the answer.
Accounting is normally both more analytical and strategic in its focus, and senior accounting roles are often more about making key business decisions based on financial data, than about processing data yourself.
Accounting offers a broader choice of career paths, and a broad split between financial and management accounting, and accountants also have more progression opportunities. If you love choices and variety, a career in accounting could be for you.
While bookkeeping and accounting have distinct responsibilities, they are closely interrelated, and many finance professionals will do both at some point in their careers. For example, some find they are able to begin in a bookkeeping role, and then later progress into accounting roles where they can build on the skills and knowledge they have gained so far.
Whichever route you choose to take, you will need to gain the appropriate qualifications so that you can demonstrate your expertise to employers.