Accounting vs. Bookkeeping
- Bookkeeping- is the tedious part of the financial affairs of a business. It involves the systematic recording of the amounts, dates and sources of each revenue and expense transaction. Bookkeeping is concerned with the systems that enable the financial information to be extracted in the transactions that generate revenue and incur expense in the business.
- Accounting - is the bigger picture. It is the system that keeps track of the data, including people, and records the transaction’s history, as well as taking the information that is obtained through the bookkeeping process and using that information to analyse the results of the business. Accounting is the system that provides the reports and information needed for management to make decisions as to the direction of the business, as well as issues such as taxation, Sales Tax etc.
Some say you should think of accounting as a giant sifter and of bookkeeping as the process of pouring the stuff into the sifter. Things get stirred around and you get the infor...
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