The first difference between a Seattle bookkeeper and an accountant is schooling. Accountants go to school for many years. They have a degree, and they need to get a continuing education every year to keep up their certification. In contrast, bookkeeping is not a regulated field. All you need as a bookkeeper is to make sure that you know your software in and out and you’re able to serve your clients. Because of that, number two is the cost of a bookkeeper versus an accountant.
Cost Matters
An accountant will quickly charge over $100/hour and sometimes as much as $400/hour. The price will depend on their specialties and what you need from them. A bookkeeper, on the other hand, is less than half that. A bookkeeper will cost somewhere in the range of $35 to $80 per hour. The price a bookkeeper charges will depend on how experienced they are and what you need from them.
The next difference between a bookkeeper and an accountant is their job description. There are variations across both these fields. A bookkeeper will be in charge of managing the daily financial tasks of a business owner. Bookkeepers take each of their client’s bank transactions and all of their income and categorize it in QuickBooks. A bookkeeper will then create financial statements each month.
Profit Loss Statements
Bookkeepers also provide their clients with a profit and loss statement. This document has all of their income that they made and all of the expenses that they had. A bookkeeper may also do things like process payroll, pay their bills, and even reconcile bank accounts. Reconciling bank statements ensures that what is in QuickBooks is matching the bank account. If businesses need invoices going out to clients, a bookkeeper can send those and then collect money coming in. In a nutshell, a bookkeeper is usually more of a daily or weekly part of a business. A bookkeeper can do some of the tasks that a business owner might’ve started out doing when they initially launched their company but no longer have time for now.
Accountants, in comparison, are tax experts. A business’s accountant is the one who will do their tax preparation each year. An accountant will be up to date on all the tax laws changes. This person will know everything about how to handle deductions. A bookkeeper will likely view the accountant as their manager. The accountant is leading the way and advising the bookkeeper on how to set up the QuickBooks account. When the accountant advises the bookkeeper, they are going to listen. This is because accountants are the experts and know exactly how they want the small business’s tax return to look.
Hiring A Bookkeeper Is Smart
For you as a small business owner, it’s very advantageous to have a bookkeeper. The bookkeeper can do all of those accounting and bookkeeping duties, but for a fraction of the rate, you would have to pay an honest accountant. Bookkeepers should partner with the accountant, usually quarterly, to sync up on financial information for paying quarterly taxes. They can take a look at the business at that quarterly mark and make sure its earnings are what they expected. If a company is making way more money than expected, the accountant will recommend paying some additional taxes. Or, if the business isn’t doing well, an accountant might recommend lowering the quarterly tax payment to compensate for the lower income.
Aldaris CPA is a Tax Accountant Seattle