When it comes to financial management for businesses, there are several professionals that can help ensure your finances are in order. Three of the most common are accountants, bookkeepers, and CPAs. While these terms may seem interchangeable, there are distinct differences between them.
Accountants
Accountants are financial professionals who have completed a degree in accounting or a similar field and have obtained certification and licensure. They offer a range of services related to financial analysis and planning, including tax preparation, financial reporting, and financial forecasting. Accountants offer strategic financial advice to help businesses make informed decisions.
Services provided by accountants include:
– Tax preparation and filing
– Financial statement preparation and analysis
– Budgeting and forecasting
– Internal and external audit services
– Financial planning and investment advice
Bookkeepers
Bookkeepers are professionals who focus mainly on recording financial transactions and maintaining accurate financial records. They typically don’t have a degree or certification in accounting but have experience and training in bookkeeping practices. Bookkeepers use software and tools to manage day-to-day financial transactions.
Services provided by bookkeepers include:
– Recording financial transactions
– Generating financial reports
– Managing accounts payable and receivable
– Reconciling bank statements
– Payroll processing
CPAs
Certified Public Accountants (CPAs) are accountants who have passed a rigorous exam and meet other state and education requirements to obtain their certification. CPAs are licensed, which allows them to perform financial audits and a range of other tax and accounting services that non-certified accountants cannot.
Services provided by CPAs include:
– Tax preparation and filing
– Financial statement preparation and analysis
– Budgeting and forecasting
– Financial planning and investment advice
– Audit services for public companies
– Forensic accounting services
Conclusion
Overall, while there is some overlap between accountants, bookkeepers, and CPAs, each serves a different role in managing business finances. Bookkeepers focus on accurate record-keeping, while accountants and CPAs provide higher-level strategic guidance in financial management. CPAs hold the highest level of certification in accounting and can provide additional services such as audit services for public companies. Consider your specific business needs and seek out the professional with the relevant experience to meet those needs.
