The Difference Between Bookkeeping and Accounting

Posted by: Andre Post Date: 1st July 2014

If you’re interested in a career in finance, you’ve probably heard about opportunities in both bookkeeping and accounting. While there is some overlap, they are distinct professions with separate functions. So, what is the difference between bookkeeping and accounting?

What is bookkeeping?

To start with, let’s take a look at the dictionary definition of bookkeeping: Bookkeeping is “the skill or occupation of maintaining accurate records of business transactions”.

The Difference Between Bookkeeping and Accounting

The central responsibility of a bookkeeper is to accurately record financial data, ensuring that entries are correct on a daily basis. They record and calculate income and expenses, undertaking activities in support of this.

For example, many bookkeepers raise invoices, deal with day to day transactions, and file VAT returns. Bookkeepers have the skills and knowledge to explain financial information to business owners, and make clear the meaning of reports based on this information.

What is accounting?

The dictionary defines accounting as “the skill or practice of maintaining and auditing accounts and preparing reports on the assets, liabilities, etc, of a business”.

Accountants are responsible for overseeing accounts, and producing statutory accounts and tax returns in compliance with the law. They must maintain a good knowledge of the financial scene, from current legislation to ethical issues. This is because a part of their role is interpreting data, and providing advice about financial decisions that will affect an organisation.

Accountants usually work with a variety of businesses, sometimes only meeting with a client once each year. This is often true of those working as part of a practice.

However, some accountants go down the management accounting route, where they are able to work from within an organisation, contributing to strategic decisions and having a large impact on business growth.

Bookkeeping vs. accounting

Hopefully, you’re now beginning to recognise the difference between bookkeeping and accounting. While both deal with the finances of a business, bookkeeping is primarily concerned with accurately recording financial data, while accounting involves interpreting and reporting on that data.

Bookkeeping and accounting have considerable overlap because the first can be considered a part of the second. Bookkeepers lay the groundwork for accountants, providing data that is essential to the performance of their role.


Now you know a bit about the difference between bookkeeping and accounting, you might be wondering what qualifications you would need to follow either of these career paths, and there are a variety of options.

Bookkeepers aren’t required to have any formal education, but the right qualifications can certainly help you demonstrate your expertise throughout your career. The Association of Accounting Technicians (AAT) provides a well-regarded bookkeeping course to kick start your career. You can study that AAT bookkeeping course from home, or as part of a class.

Accountants need to prove their ability through qualifications, and which ones you choose depends on previous experience, as well as where your ambitions lie. Take a more in-depth look at how to become an accountant in our recent blog post.

Those just embarking on their accounting education often begin with AAT courses. Slightly more advanced are the ACCA courses, which are internationally recognised. For those with an interest in management accounting, CIMA courses are a popular choice.

If you’re not sure whether to take financial or management accounting qualifications, take a look at our post, ‘CIMA or ACCA?‘.

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