Bookkeeper, Accountant, or CPA Who Does Your Business Need?

As a business owner, you should invest in a bookkeeper, an accountant, a CPA or an experienced accounting services firm because their work proves crucial when the taxation season arrives. It determines the accuracy of your tax preparation and compliance.

People do use the terms bookkeepers, accountants, and CPAs interchangeably. Yes! They do handle finances and related data of your business. And they assist you in achieving your core goals. However, they are unequal, and their work is not the same.

Here is the elaboration on their work.

• A bookkeeper files your receipts and invoices and updates the daily ledger
• An accountant analyses financial transactions and assists you in cash flow management
• A CPA determines whether you have prepared a business' financial statement as per the accounting principles
• Bookkeeping and accounting services have experts who can streamline your accounting tasks

As you can see, bookkeepers, accountants, and CPAs perform different accounting tasks.

Bookkeeper

Bookkeepers file invoices, receipts, bills, and other financial documents chronologically. They maintain these documents for future reference.

• The bookkeeper's job is to record a business' financial transactions systematically and accurately
• They also do the billing, invoicing, pay vendors, etc
• They process payroll, prepare financial reports, etc
• They use bookkeeping software to maintain a daily ledger
• They also use it to track incoming and outgoing cash

Accountant

An accountant analyses and evaluates the business' records for financial insights. Depending on the insights accounting services,

• Accountants give financial advice to owners
• They pinpoint unnecessary expenses, errors, irregularities in data, etc
• They advise on business areas needing improvements and optimal use of resources
• They calculate tax amounts and provide tax advise
• They also prepare financial reports and projections, income tax returns, etc
• They prepare budgets and work with auditors

Certified Professional Accountants (CPAs)

CPAs from bookkeeping services are certified accountants and command higher accounting skills which they use to assist businesses in achieving financial goals. They help companies in preparing tax returns.

During the day, CPAs may,

• Update records
• Perform in-depth audits
• Help field IRS audits and enquieries
• Help in wealth management

Who you hire depends on the tasks you want them to do for you. Today's trend is to hire an accounting services provider having a team of experts. So, knowing your accounting needs and choosing the right professional is the right way to take care of your business' accounting.