Do you need a Bookkeeper or CPA?
What hat or hats are you wearing today as a small business owner? Researcher, marketer, sales associate, janitor, file clerk, or bookkeeper? The many hats are probably starting to weigh on you and you have been thinking about bringing in a professional. An accounting professional can perform tasks more efficiently, meet compliance requirements, and convert accounting data into useful information. This allows you to refocus your time on growing and managing your business.
But what kind of accounting professional is right for you and your business, a Bookkeeper or CPA?
Bookkeeper
Bookkeepers do just that, keep the books. They will provide structured accounting procedures and maintain the financial records for a business, typically using software like Quickbooks. The main goal of a bookkeeper is to organize financial information in such a way that it can be used by business owners, managers, and accountants. They handle day-to-day accounting transactions or issues and typically can handle the accounts receivable, accounts payable, monitor and report on available cash, perform bank reconciliations, generate management reports, and run payroll. A skilled bookkeeper will understand the day-to-day financial operations of the company and will be able to dig into the details.
CPA - Certified Public Accountant
A CPA will analyze the financial information that a bookkeeper prepares. They advise their clients on a variety of financial issues, and they complete financial reports and tax forms. While some CPA's may provide bookkeeping services, they are also skilled in preparing the financial statements and reports that are required by banks and governmental agencies—like the IRS. CPA's handle more big picture government regulated tasks like preparing tax returns, income tax planning, preparing official financial statements, and provide advice on tax law, entity structure, and key financial decisions.