The small business owner certainly has a lot of responsibilities, and if you are one, then you know very well that this is true. On top of having to find new clients and take care of your existing customers, you also have to make sure that your financial accounts and records are in order, and this can take up a lot of time. The services of a professional can be a good thing for your business – and your sanity – but if you are thinking of hiring either an accountant or bookkeeper, how do you know which one you really need? Here’s how you can decide.
Know the core differences
First, you have to know the precise differences between the two. Bookkeepers are essentially trained to keep financial books and retain and store documentation for your transactions. Accountants will often be focused on reporting as well as business processes and analyses, and they can offer you advice. Accountants and bookkeepers will require training and should have certification, particularly from professional bodies, and it would be good to ask them for client references.
More on bookkeepers
A bookkeeper can keep your books, and they can manage the day to day documentation and paperwork like the creation and sending out of invoices, the management of your bills from suppliers, the management of receipts, and the recording of your financial records and transactions into a system or software. Many bookkeepers can also help you with your payroll and VAT.
In the United Kingdom, a bookkeeper can acquire a more professional qualification if they pass certain exams, so if you want your bookkeeper to handle more complex tasks such as payroll and VAT, it would be best if they have a certification from either AAT or Association of Accounting Technicians or ICB or Institute of Certified Bookkeepers.
More on accountants
Accountants can perform bookkeeping tasks, but they can certainly do more. They can, for instance, prepare your business accounts every month, and they can also prepare your year-end accounts, as done by the accountants in central London from Griffin, Stone, Moscrop & Co. Your accountant can prepare as well as file your taxes and VAT, and they can offer you practical and expert advice as well. To get a qualified accountant, look for either a fellow or member of the Institute of Chartered Accountants in England & Wales or a member of CIMA (Chartered Institute of Management Accountants) or ACCA (Association of Chartered Certified Accountants).
Do you need an accountant or bookkeeper?
If your enterprise is just starting and you would like to get professional help and advice for VAT and accounting software and your business’ structure, an accountant would be a good choice. If you simply want someone to go over your accounts and let you know if your business is financially healthy, you can turn to either of the two, although accountants may be more adept at pointing out risks or opportunities for your business. Accountants are also better when it comes to filing your tax return, and even if you are doing your own, it’s best to have it checked and verified by an accountant. If you simply need to be more organised, you can rely on a bookkeeper, but it’s always good to have a clear idea of your finances at every turn.
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