Bookkeeping vs Accounting: What's the Difference?

Many business owners confuse bookkeeping with accounting, but they serve different purposes. Bookkeeping involves recording daily financial transactions, categorizing expenses, and reconciling accounts. Accounting, on the other hand, interprets that financial data to create reports, manage tax obligations, and provide strategic business advice.

Think of bookkeeping as keeping your financial house in order, while accounting is about understanding and planning for the future. Both are essential, but bookkeeping lays the groundwork for accurate financial reporting.

Whether you do it yourself or hire a bookkeeper, keeping your records up to date is crucial for business success.