--- title: Comparing Accounting and Bookkeeping | SmartBiz Bank® description: Learn more about the similarities and differences between bookkeeping and accounting, and when it may be time to hire a financial professional for your company. image: https://smartbizbank.com/hubfs/Imported_Blog_Media/bookkeeping-vs-accounting-2-1-2.jpg --- - [Share](https://smartbizbank.com/blog/bookkeeping-vs-accounting-main-differences-similarities#) - - - - [mailto:?subject=Check%20out%20https://smartbizbank.com/blog/bookkeeping-vs-accounting-main-differences-similarities](mailto:?subject=Check%20out%20https://smartbizbank.com/blog/bookkeeping-vs-accounting-main-differences-similarities) # Bookkeeping vs. Accounting: Main Differences & Similarities July 6, 2020 By [Devanny Haley ](https://smartbizbank.com/blog/author/devanny-haley) Every business owner should know that, although accounting and bookkeeping are both important business functions, there are differences. Accountants and bookkeepers support your business in different ways as your business evolves. Here are details to consider. [![See if you pre-qualify](https://no-cache.hubspot.com/cta/default/21458256/a49a0a2c-49ab-48f9-8866-fcdf35383b95.png)](https://cta-redirect.hubspot.com/cta/redirect/21458256/a49a0a2c-49ab-48f9-8866-fcdf35383b95) ## What is bookkeeping? Bookkeeping sets up the foundation for accountants, tracking your finances by recording transactions. This gives you a holistic view of your business so that you may easily see the amount of money coming into and leaving your business. Here are six common bookkeeping tasks: - Recording income from services and expenses like rent, utilities, and office supplies. - Managing payroll. - Depending on your needs, some bookkeepers create invoices and make payments. - Comparing the [balances in your books](https://smartbizbank.com/blog/how-to-get-your-books-in-order-before-january-1) against bank transactions to see if they match, and making adjustments and bank reconciliation statements if they do not. - Tracking accounts payable and accounts receivable. - Maintaining the general ledger that has a record of all financial transactions. The general ledger typically uses the double-entry accounting method, meaning that, for every debit on one account, there is a corresponding credit on another. ## What is accounting? Accountants use the financial data to offer detailed insights and guide smart business decisions. Here are four responsibilities of an [ accountant](https://smartbizbank.com/blog/8-best-free-accounting-software-for-small-business). - Preparing financial statements to help you assess the overall financial health of your business, including: - Analyzing journals and ledger entries, making adjustments, and identifying any incurred expenses that have not yet been recorded - Providing tax advice, completing and filing tax returns - Offering financial advice and helping you understand the consequences of your financial decisions ## Bookkeeper credentials Bookkeepers aren’t required to have specific education, but they should be very accurate and familiar with key financial topics. While not required, some certifications may help you identify the right fit. QuickBooks® ProAdvisor and AIPB certification are popular ones. Choosing someone with these certifications may help ensure that you’re getting a bookkeeper who understands how to use modern tools. ## Accountant credentials Generally, if you want to practice as an accountant, you must have a bachelor’s degree in accounting or another finance degree. Accountants usually are awarded additional professional certifications, like Certified Public Accountant (CPA). Learn more here from the Crush the CPA Exam blog: [Top 5 Best Accounting Certifications](https://crushthecpaexam.com/best-accounting-certifications/). ## What are the differences between bookkeeping and accounting? Accountants are qualified to handle the entire business accounting process, while bookkeepers handle recording financial transactions. For accuracy, accountants often advise bookkeepers and review their work. Bookkeepers take care of financial transactions so accountants may analyze the data. ## Similarities between bookkeeping and accounting Because they both work in the financial sector, bookkeepers and accountants share some similarities. Both of them work with financial data. However, bookkeepers primarily focus on transactions while accountants focus on a company’s large-scale financial data. Both are there to help the business improve its financial decision-making. They also both work to help a business be compliant with [state and federal tax regulations](https://smartbizbank.com/blog/tax-basics-for-small-business). In small businesses, the roles may even overlap. Accountants often have bookkeepers review their work, and in a small company, the two may work closely together to help the business owner get a fuller, clearer picture of the company’s financial status. ## When should a business owner hire bookkeepers or accountants? Small entrepreneurs may be able to outsource accounting or bookkeeping services for quite some time or until their bookkeeping takes five or more hours per week. Some small businesses usually choose to hire a bookkeeper once they start generating more than $100,000 per year in revenue. Until then, most businesses usually don't have enough work to keep a full-timer busy every day. If you’re constantly calling your accountant, it might be time to hire someone to help manage your finances in-house. It may be a good idea to bring in a full-time bookkeeper when your part-timer is spending two or three full days in the office and still falling behind. Keep in mind that a bookkeeper compiles the financial data, and the accountant makes sense of it and should be able to provide business operation recommendations. An accountant for your small business is also very helpful when you need help with the collection, analysis, and reporting of financial information. If you’re spending valuable time on bookkeeping or numbers aren’t your strong suit, consider bringing a bookkeeper on staff or hiring an outside consultant. ## Helpful accounting software programs AI has impacted virtually every industry, and accounting is no exception. Most of the top accounting programs utilize AI to gather and process data faster. Shoebox accounting (tossing everything together and sorting it out later) may cripple your company. These days, small businesses need an accounting system that’s cost-effective, up-to-date, and should be able to handle all financial tasks you need to run your company. If you’re not happy with your current system or need to establish one, consider one of these free accounting software systems: - [Zoho Books](https://www.zoho.com/) offers a free tier. You may automatically upload documents and use a language-model AI tool to retrieve needed data. ## Investing in your company’s financial health Hiring a bookkeeper, accountant, or even both may significantly improve your business’s financial future. Even if it’s not time to bring someone aboard, investing in modern, quality financial management software may position you to make better decisions going forward. If you need additional funding for these purposes, SmartBiz Bank may be able to help. Find out if you [pre-qualify](https://smartbizbank.com/bank-term-loans) today. ![Q3 Promo E1](https://smartbizbank.com/hubfs/Q3%20Promo%20Email%20Images/Q3%20Promo%20E1.png) ### Access Funds Quickly Apply for a Bank Term Loan from a bank in our trusted network [![See if you pre-qualify](https://no-cache.hubspot.com/cta/default/21458256/08df270b-4561-4437-a5aa-11d47ef08efb.png)](https://cta-redirect.hubspot.com/cta/redirect/21458256/08df270b-4561-4437-a5aa-11d47ef08efb) - [Follow SmartBiz](https://smartbizbank.com/blog/bookkeeping-vs-accounting-main-differences-similarities#) - - - - - ### Access to the right loan for right now We’re connecting small businesses with SBA, bank term loans, lines of credit, and flexible financing options. [![See if you pre-qualify](https://no-cache.hubspot.com/cta/default/21458256/08df270b-4561-4437-a5aa-11d47ef08efb.png)](https://cta-redirect.hubspot.com/cta/redirect/21458256/08df270b-4561-4437-a5aa-11d47ef08efb) ##### Topic - [Business Loans](https://smartbizloans.com/blog/tag/business-loans) - [Business Stories](https://smartbizloans.com/blog/tag/business-stories) - [Marketing](https://smartbizloans.com/blog/tag/marketing) - [Money Management](https://smartbizloans.com/blog/tag/money-management) - [Operations](https://smartbizloans.com/blog/tag/operations) ## Related Posts [ See all blog posts ](https://smartbizbank.com/blog) [Money Management July 01, 2026 ## How to Reforecast Your Budget Based on Summer Trends When you built your company’s budget for this year, you no doubt looked at past data. However, there were probably also some future projections that... Read More ](https://smartbizbank.com/blog/reforecast-your-budget-with-summer-trends-smartbiz-bank) [Money Management June 24, 2026 ## The Counterintuitive Truth About Summer Slowdowns For many small business owners, summer is an uncomfortable time of year. Many consumers travel or spend more time at home, which typically leads to them making fewer... Read More ](https://smartbizbank.com/blog/do-less-this-summer-to-grow-your-business-smartbiz-bank) [Money Management June 22, 2026 ## Small Business Revenue: Determine Where You Stand As a business owner, regularly reviewing your annual revenue gives you a clear picture of your company’s current health and helps you evolve your business strategically so... Read More ](https://smartbizbank.com/blog/small-business-revenue-determine-where-you-stand) ### Smart growth is smart business ## Access to the right loan for right now See if you pre-qualify, without impacting your credit score. 1 [ Apply Now ](https://smartbizbank.com/apply) 1. We conduct a soft credit pull that will not affect your credit score. However, in processing your loan application, SmartBiz Bank and the lenders with whom we work will request your full credit report from one or more consumer reporting agencies, which is considered a hard credit pull and may impact your credit score. The SmartBiz® Small Business Blog and other related communications from SmartBiz BankSM are intended to provide general information on relevant topics for managing small businesses. Be aware that this is not a comprehensive analysis of the subject matter covered and is not intended to provide specific recommendations to you or your business with respect to the matters addressed. 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