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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?


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.

Why consider both

Both bookkeepers and CPA's provide strategic financial advice to their clients. A bookkeeper might tell you how to streamline your accounting processes or help you create a budget for your business while a CPA could recommend ways to minimize your tax liability or help you decide whether to incorporate your business. The best explanation I have ever heard for comparing a bookkeeper to a CPA is that it is a lot like a nurse and doctor. Your nurse/bookkeeper is going to tend to your needs and have an eye for the details while your doctor/CPA will have your back by focusing on the bigger picture and legal ramifications. You can have just one or the other but you are better taken care of and have a higher chance of success with both.

CPA's and bookkeepers are accustomed to working hand in hand. If you already have a bookkeeper, they can probably recommend a CPA they have worked with and vice versa.

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