Isn’t accounting and bookkeeping the same thing?
No, they are not. Generally, bookkeepers control and organize source documents, classifies and handles data entries and performs account reconciliations.
Bookkeepers with the Certified Professional Bookkeeper designation (CPB) can
a. review and analyze the General Ledger for accuracy,
b. prepares adjustment entries to fix inaccuracies,
c. performs year-end procedures to ensure the data is ready for the accountant to produce Notice to Reader Financials or conduct a review engagement or audit, and
d. acquires a “big picture” understanding of the bookkeeping process and are familiar with Generally Accepted Accounting Principles (GAAP).
Accountants, on the other hand
a. have an accounting degree as well as the Certified Professional Accountant (CPA) designation,
b. generally contract or hire a bookkeeper,
c. determine the best setup and internal controls for a business owner’s bookkeeping system,
d. monitor the system and interpret the results,
e. provide strategic tax planning, and
f. has an in-depth knowledge of GAAP as well as the Income Tax Act.