Bookkeeping and accounting are two different departments related to the company's accounts. Bookkeeping is the initial stage in which we keep records of income and expenditure, while the accounting department analyzes the financial activity of the company in accountants and prepares the report, both are very important for proper management and financial success of a business.
Bookkeeping
In simple terms, recording the financial transactions of a company or person is a bookkeeping, such as sales, purchases, revenues and expenditures traditionally, it is said to be in the form of bookkeeping since being kept in books; Now there are specific software for this purpose, but the old name is still in use. Generally, bookkeepers are appointed so that the record can be accurately and accurately placed. This activity is very important for the financial health of a company because it informs management about the financial condition of its company. According to the nature of the business, there are commonly used books, day book, account-consumption, cash book and trade check book, many others are also used. A bookmaker enters his related book in a particular financial activity. And also posts as a account holder. Single Entry and Double Entry are two types of bookkeeping methods, as the name suggests, transactions in a single entry are entered either in the debit or credit column in the same account, but in the case of double entry, every transaction Two entries are given to the laser, the other in the debit column, under another credit title.
Accounting
Accounting is related to organizational recordings, reporting and analysis of the company's financial activity. Making statements about property and liabilities also comes under the jurisdiction of accounting. Accountants are also responsible for making monthly financial statements and annual tax returns. Accounting departments also prepare the company's budget and plan for loan proposals. In addition, they analyze the costs of the company's products or services. Now, one day, accounting is called the language of business, because it provides the necessary information to many people, for example, management accounting is a branch that informs the company's managers. Financial accounting tells outsiders companies like banks, vendors and stakeholders about the company's financial activities. The nature of information for external and insiders is different, so big companies need both these branches.
Differences and similarities
Both the Finance Department have different sections, bookkeeping involves having a systematic record of the company's financial activities, where the accounting is the next section, which analyzes these records to prepare various reports and proposals. Bookkeeping in the process, which helps management manage financial activities of the company, while the accounting makes the financial work justified and finds its causes. In large companies, the accounting department is too big to analyze the financial activity of the business department, on the other hand, a person usually keeps on accounting or mostly involved in this activity in two people, even in large companies as well.
Conclusion
It is important to bookkeeping and accounting is essential for any business to run successfully, because it is the primary step of keeping a financial record and analysis is done based on the brick of accounting bookkeeping system.