When the majority of people consider accounting and bookkeeping, they’d be hard-pressed to explain the differences between each and every process. Even though bookkeepers and accounting firms share common goals, they support your company in various stages of the financial cycle. Bookkeeping is much more translational and administrative, concerned with documenting financial transactions. Accounting is a lot more subjective, providing your business ideas based upon bookkeeping details. In this particular guideline, we will make clear the important differences between accounting and bookkeeping, along with the differences regarding the roles of bookkeepers and accounting firms.

The function of bookkeeping

Bookkeeping is the method of recording everyday transactions in a consistent way, and it is an essential component to developing a financially profitable business.

Bookkeeping is composed of:

• Recording financial transactions
• Posting debits and credits
• Producing invoices
• Maintaining and balancing subsidiaries, general ledgers, and historical financial records
• Completing pay-roll

Maintaining a general ledger is among the main ingredients of bookkeeping. The general ledger is actually a standard document in which a bookkeeper records the amounts from sales and expense invoices. This is known as posting and the more sales that are completed, the more often the balance sheet is published. A ledger can be produced with specialized software, a computer spread sheet, as well as a lined piece of paper. The complexity of a bookkeeping process frequently depends upon how big the company and the amount of transactions which are concluded every day, weekly, and per month. All sales and purchases created by your company must be documented inside the ledger, and particular items require supporting documents. The Internal Revenue Service explains which company transactions require supporting documents on their site.

The functionality of accounting

Accounting is really a high-level method that uses financial info created by a bookkeeper or company owner, and creates financial models by using their info. The means of accounting is much more subjective than bookkeeping, which can be largely translational.

Accounting is composed of:

• Preparing adjusting entries (documenting expenditures that have occurred but are not yet documented inside the bookkeeping process)
• Preparing business financial statements
• Analyzing expenses of businesses
• Filling out income tax returns
• Aiding the company owner to understand the effect of financial choices

The entire process of accounting delivers reports that bring crucial financial indicators together. The outcome is a much better knowledge of actual earnings, as well as an understanding of cashflow in the company. Accounting transforms the data from the balance sheet into statements that expose the bigger picture of your company, and also the course the business is progressing on. Companies will most likely turn to an accounting firm for assistance with organizing tax preparation, financial projecting, and tax filing.

BBS provides expert payroll services to fit your needs. We have experience in  handling complicated deductions including union and non-union employees.  In the current fast paced world, business isn’t just about effectiveness but accuracy and reliability as well. That is why your pay-roll needs to be exact, quick and easy to use. That’s who we are.

We know your payroll methods ought to be simple and easy, accurate, but that is so frequently not the situation with many payroll businesses. This may lead to substantial issues in turnover, increased labor expenses, time lost and significant liabilities for the company. It does not need to be that difficult.

No matter if you have 5 employees to 100 or higher, we can provide you with a method that simplifies your payroll as well as your life.

There is a lot to do on the operations side of business.  Let us manage the operations while you manage growing your business.

BBS knows that every business is different and has different needs.  We are here to tailor our services to meet your needs.  Contact us today to see how we can help you!