What’s the Difference Between Accounting
& Bookkeeping?

HomeBlogWhat’s the Difference Between Accounting & Bookkeeping?

At Proctor & Assocs., we specialize in accounting & bookkeeping, and we have answered many questions about these practices over the years. Although these two terms are closely related, there are a number of important distinctions between them. In this article, we’ll be going over a few of these differences to hopefully satisfy any curiosity you may have about this topic.

What’s the Difference Between Accounting & Bookkeeping?

  • Interpretation vs. Documentation- One of the main differences between accounting & bookkeeping is that bookkeeping is concerned with documenting financial transactions, while accounting is concerned with analyzing and interpreting that data in order to communicate the most important points to others. Accountants need bookkeepers in order to have solid data to analyze, while having bookkeepers without accountants leads to financial stagnation.
  • Role in Decision Making- As we at Proctor & Assocs. alluded to above, another difference between accounting & bookkeeping is the role that each plays in a company’s decision-making. A bookkeeper’s job is to simply record financial information, and the position does not involve any decision-making authority. Accountants, on the other hand, are expected to consult with the management about this data and what it means, and their input can play a significant role in company decisions.
  • Goal- Another difference between accounting & bookkeeping relates to the above two points, and this difference is that these two practices have different goals. The goal of bookkeeping is to create accurate records of all financial transactions and to organize and maintain them in a logical, accessible way, while the goal of accounting is to use these records to evaluate the company’s financial state and advise the management on what to do about it.

We at Proctor & Assocs. hope that this information helps clarify these two roles and their purposes. If you need reliable accounting & bookkeeping services for your business, we encourage you to reach out to our team.