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What is the Difference Between Bookkeeping and Accounting?

Image: difference between bookkeeping and accounting

Have you wondered whether it's worth the time and effort to pursue an accounting degree, or whether you should instead work as a bookkeeper, a job that doesn't typically require a college degree? On first glance, the difference between bookkeeping and accounting seems small, but a closer examination of duties and salary demonstrate that earning a degree can indeed pay off in the end.

While both bookkeepers and accountants are essential in that they help analyze and manage the finances for an organization, there are big differences in the responsibilities of each profession. A bookkeeper is responsible for accurately recording an organization's financial transactions, while an accountant is tasked with handling the entire accounting process, from maintaining the bookkeeper's records to interpreting and analyzing that financial data for top management.

Let's start with more details about their standard job responsibilities.

What Bookkeepers Do

Bookkeepers (also called accounting clerks or auditing clerks) record an organization's financial transactions, update statements and check financial records for accuracy.

A bookkeeper's job duties typically include:

  • Operating computers programmed with accounting software to record, store and analyze information.
  • Checking figures, postings and documents for correct entry, mathematical accuracy and proper codes.
  • Classifying, recording and summarizing numerical and financial data to compile and keep financial records, using journals and ledgers or computers.
  • Receiving, recording and banking cash, checks and vouchers.
  • Reconciling and reporting discrepancies found in records.1

What Accountants Do

An accountant or auditor is expected to interpret and analyze data as well as ensure that the organization's financial records are accurate and that taxes are paid properly and on time. They also are asked to assess financial operations to find efficiencies.

An accountant's job duties typically include:

  • Preparing and analyzing financial reports to assess accuracy, completeness and conformance to reporting and procedural standards.
  • Reporting to management regarding the finances of establishment.
  • Developing and implementing record keeping and accounting systems
  • Computing taxes owed and preparing tax returns, ensuring compliance with payment, reporting or other tax requirements.
  • Advising clients in areas such as compensation, employee health care benefits, the design of accounting or data processing systems, or long-range tax or estate plans.
  • Analyzing business operations, trends, costs, revenues, financial commitments and obligations to project future revenues and expenses or to provide advice.2

Both professions are growing at similar rates, according to the United States Bureau of Labor Statistics (BLS): Employment of accountants and auditors is projected to growth 13 percent from 2012-20223, while the number of bookkeeping, accounting and auditing clerks is projected to grow 11 percent over the same period.4

Salary for Accountants and Bookkeepers

You will find a dramatic difference between bookkeeping and accounting at the level of pay. Bookkeepers earned a median salary of $35,170 in 2012,5 according to the BLS, while accountants earned a median salary of $63,550 as of 2012.6

Besides the higher level of responsibility accountants have in their roles, also likely contributing to that difference is the education expected from employees in each profession. A bookkeeper's entry-level education is typically a high school diploma or equivalent7, while an accountant's entry-level education is typically a bachelor's degree8. A quality degree program can provide students with the knowledge and skills to pursue opportunities in the accounting field, covering topics ranging from micro and macro economics to cost accounting, managerial accounting and accounting in finance and taxation. So do the math, and figure out whether an accounting degree is the right choice for you!

Interested in learning more? Explore AIU's accounting degree programs.

1O*Net, Summary Report for Bookkeeping, Accounting and Auditing Clerks, on the Internet at http://www.onetonline.org/link/summary/43-3031.00 (visited 2/04/2015)

2O*NET, Summary report for Accountants, on the Internet at http://www.onetonline.org/link/summary/13-2011.01 (visited 2/4/2015)

3Bureau of Labor Statistics, U.S. Department of Labor, Occupational Outlook Handbook, 2014-15 Edition, Accountants and Auditors, on the Internet at http://www.bls.gov/ooh/business-and-financial/accountants-and-auditors.htm (visited February 04, 2015).

4Bureau of Labor Statistics, U.S. Department of Labor, Occupational Outlook Handbook, 2014-15 Edition, Bookkeeping, Accounting, and Auditing Clerks, on the Internet at http://www.bls.gov/ooh/office-and-administrative-support/bookkeeping-accounting-and-auditing-clerks.htm (visited 2/4/2015).

5Bureau of Labor Statistics, U.S. Department of Labor, Occupational Outlook Handbook, 2014-15 Edition, Bookkeeping, Accounting, and Auditing Clerks, on the Internet at http://www.bls.gov/ooh/office-and-administrative-support/bookkeeping-accounting-and-auditing-clerks.htm (visited 2/4/2015).

6Bureau of Labor Statistics, U.S. Department of Labor, Occupational Outlook Handbook, 2014-15 Edition, Accountants and Auditors, on the Internet at http://www.bls.gov/ooh/business-and-financial/accountants-and-auditors.htm (visited February 04, 2015).

7Bureau of Labor Statistics, U.S. Department of Labor, Occupational Outlook Handbook, 2014-15 Edition, Bookkeeping, Accounting, and Auditing Clerks, on the Internet at http://www.bls.gov/ooh/office-and-administrative-support/bookkeeping-accounting-and-auditing-clerks.htm (visited 2/4/2015).

8Bureau of Labor Statistics, U.S. Department of Labor, Occupational Outlook Handbook, 2014-15 Edition, Accountants and Auditors, on the Internet at http://www.bls.gov/ooh/business-and-financial/accountants-and-auditors.htm (visited February 04, 2015).

The presence of specific potential jobs on this list does not guarantee availability of career opportunities. All statistics referenced are national historical averages and the figures in your area and at the time of your job search may be different.

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