Bookkeepers vs Professional Accountants
Many bookkeepers in our world today define themselves as accountants, but what is the difference between a Professional Accountant and a Bookkeeper? This essay aims discuss and examine the relationship between each of the occupations, examine the differences that sets the two occupations apart and then explore what makes an accountant a professional in today’s world. Comments made by third parties will be looked at in depth in order to reach a fair conclusion.
Bookkeepers today have an important but restricted role in the business world. Their main role is to record the financial transactions of a business. As a bookkeeper, you will be employed to sustain all the ledger accounts, and maintain all the other documents up to the trial balance. The dictionary of Economics & Business by Christine Ammer & Dean S Ammer defines bookkeeping as, “keeping the financial records (books) of a business or other economic unit, recording all transactions in which it engages”. This evidence clearly states that a bookkeeper is subjected to only recording the transactions until the accounting period has finished and the trial balance produced, and is then subsequently handed over to a more qualified member of staff to produce reports or statements.
In the present time, accountants have a more complex role in the business world. As an accountant, you must posses all the skills of a bookkeeper, but in addition to that, an accountant must be able to use the information provided by the bookkeeper to produce and communicate clear statements and reports. The Oxford Dictionary of Business & Management states that “wherever accountants work, their responsibilities centre on the collating, recording and communicating of financial information and the preparation of analysis for decision making purposes”. By this comment, we are able to see the complexity of an accountants role in business and understand the services they provide.
You may be thinking that an accountant is just a more advanced bookkeeper, but there are many other differences. In order to become an accountant, you require formal qualifications. The typical entry route into being an accountant is to study a relevant subject for 4 years at university and then undertake a training vacancy with an accounting firm. On the other hand, bookkeepers require no formal qualifications in order to begin training. This is because accountants provide a range of services whereas bookkeepers provide only one service and there is a mechanical-like nature to the way they do their job. As an accountant, one skill that is compulsory is communication; whether it be researching what the clients business does before providing services to them, finding out about the client’s needs or presenting the financial reports of an accounting period, a high percentage of your role would involve communicating with others. Communication in bookkeeping is not required as it is an office based job where producing the ledgers and other documents such as the cashbook and trial balance are the only tasks that are carried out. The difficulty of the each occupation is reflected in each jobs average salary. The average chartered accountant earns £70,000 per year, whereas the average pay of a bookkeeper is £20,000 per year. This provides a clear comparison of the relationship between each of the occupations and each salary emulates the difficulty of the role entailed.
Accounting is a very important aspect of any business organisation, but there are many different roles in which accountants are engaged in. Among the most common financial services accounting firms offer are accounting, taxation and investment. Due to what they offer are professional services, it is essential for accounting firms to identify all factors and issues that would significantly impact their profitability and their reputation. The Times states that the main role within accounting is “the...
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