In previous articles on this site we have discussed Better Bookkeeping Tips and What Can An Accountant Do For You but what exactly are the different roles that a bookkeeper and accountant can play within your business?
Bookkeeper. Basically, a bookkeeper records the daily financial transactions within your business. Many small and medium sized businesses will have either a full-time or part-time bookkeeper in-house, although your accountant should also be able to manage your bookkeeping duties if required.
These duties involve things like making detailed and accurate records of the financial transactions the company makes. These records are then available for an accountant to create financial statements relating to the financial position of the company, which can then be used by internal and external stakeholders as well as potential investors in the company.
In addition to recording these processes, the bookkeeper may also be organising staff payroll and employer’s guaranteed superannuation contributions as well as managing accounts payable and receivable – and often the debt collection duties relating to outstanding accounts receivable.
Because smaller businesses are less likely to have a full-time in-house accountant, the accuracy of the bookkeeper’s records can have a significant impact on the overall accuracy of any financial statements created using that information. Detailed auditing of financial records by qualified auditors can be a costly and time-consuming procedure for your business, so choosing an effective bookkeeper is important.
Accountant. As already noted, an accountant uses the historical financial data to generate the financial statements for a business. These statements detail the financial position of the business and can have a huge impact on the likelihood of attracting investors, either through direct investments or through share trading if the company is listed on the stock exchange.
Extensions of this reporting process include determining any income tax and GST expenses, credits or deductions that the company may have, and ideally also providing advice on business development issues and opportunities that may have been brought to light during the reporting process.
In essence, a bookkeeper is recording the financial data of the business and the accountant is reporting on that data in a format that is useful to any parties, both internal and external, that may have an interest in the company.
By Jennifer Lowe
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