Whether you sell cars, legal services, homemade crafts, or smartphones and computers… there are two things are can guarantee about your business: money comes in and money goes out. Financial experts like Accountants and bookkeepers are the ones who help you manage all of that.
Both can help you manage your finances, prepares tax returns, and may very well help you run the day-to-day aspects of your business. An interesting little bit of history is that accountants and bookkeepers have been around since 2600BC, when records were tracked with a stylus on slabs of clay, making accountancy one of the world's oldest professions.
In colonial America, bookkeepers would record transactions in a “waste book” (so-called because the data would eventually make its way into an official ledger and the original book would be thrown out). Today those initial entries are likely made by a bookkeeper, and then handed off to an accountant come tax time.
So what’s the difference between accountants and bookkeepers?
Well, there are some financial tasks that bookkeepers simply aren’t trained for, and that’s where accountants come in. While bookkeepers record daily transactions, accountants use the information to produce complex financial models to help you predict how your business will grow in the future. Bookkeeping is more straightforward and transactional, while accounting is more subjective and calls for skilled interpreters who can, for instance, help you understand when its time to incorporate your business.
Bookkeepers offer a literal look at where you stand financially at the moment, and accountants help you see the bigger picture, and the path your business is on. You don’t need any specific training to be a bookkeeper or even a degree. Just general attention to detail can help you get the job. Accountants, on the other hand, go through strenuous training and standardized exams to become CPAs.
Though a small business may make financial decisions based on the advice of their bookkeepers, corporations and growing businesses always turn to their accountants. Especially their CPAs, who can analyze financial data to a degree far beyond anything in a simple journal or ledger.
The biggest difference between a bookkeeper and an accountant, for a career seeker, would be growth. Bookkeeping is essential for any business, but there’s not much room for advancement. An accountant, on the other hand, can start in an entry-level position and move in any direction they might want. It’s one of the rare Omni-directional professions. You might become a Manager, Chief Financial Officer, Corporate Controller, or even CEO. And work within organizations as differing as small accounting firms, giant financial firms, the government, and even companies like Google, Apple, and Disney.
CPAs are in every industry, all over the world… running companies, making world-changing decisions, and never hit a career dead end. The sky’s the limit.