What are the differences between a CPA, a bookkeeper, and an accountant? While all three of these professionals handle the finances for their employer, they each have different scopes of work. Bookkeepers record every company transaction involving money. Accountants provide a more in-depth analysis of financial transactions. CPAs are state-approved accountants who need to pass exams to be able to use that title.
Many people think of CPAs as accountants who work with numbers, but the truth is that they are not just accountants. They are also professionals who give advice to individual taxpayers and businesses on tax matters. You may be wondering what Las Vegas CPA professionals do, or how CPA for medical professionals differs from other types of CPAs. Read this blog post to find out.
1. What is a CPA?
Also known as Certified Public Accountants, a CPA earns 10-15 % more than a bookkeeper or an accountant. The process of becoming a CPA is tough. And in most places, you’ll need a bachelor’s degree. They need to follow certain regulations regarding their experience and continuing education before passing the Certified Public Accountant Examination.
CPA professionals take on more obligations and duties when compared with bookkeepers and accountants. They also audit and oversee the company’s financial information and may work with an organization’s accountants and bookkeepers. The professionals CPA offer a range of tax, financial, and auditing services.
2. What is a bookkeeper
Once upon a time, a bookkeeper was the one who was in charge of keeping accounts in a hard-copy form. Nowadays, bookkeepers are more prone to using software programs and applications, but the end goal is the same – keep track of the money moving in and out of the company.
A bookkeeper focuses more on recording the transactions made by a company, whether they are big or small. Because of this, bookkeepers do not deal with financial analysis and tax-related concerns. Aside from recording purchases and sales, a bookkeeper also adjusts the books, which includes updating accounts and reconciling ledgers.
- Bookkeepers track accounts receivable and accounts payable, so the company is aware of how much it owes and what consumers owe to them.
- They settle the accounts for payable bills.
- They maintain and process the payroll system.
Bookkeepers do not require a college education. Some bookkeepers have only a high-school diploma.
3. What is an accountant
Unlike a bookkeeper or a CPA, an accountant is someone who provides a more in-depth analysis of financial transactions. Bookkeeping is just a section of accountants, accounting is a far more complicated and analytical job role. They evaluate financial data to produce financial forecasts as well as advise on elements that may have an impact on the company’s growth.
Accountants can work for either public or private companies and they may also be referred to as an auditor. An accountant’s main goal is to offer more complex services than bookkeeping for clients, but not so much as CPA professionals who have additional responsibilities such as providing tax-related advice or auditing companies’ financial statements.
4. How are they different?
Only CPAs can produce an audited financial statement, such as a balance sheet or an income statement, whereas any accountant may do so. On the stock market, firms that offer shares must give audited statements to investors so they can evaluate the stock’s value. Small businesses without a public offering may get by with a non-CPA accountant.
The main difference between these two professions comes down to one’s scope of work: while CPAs focus their attention on audits and taxes, accountants provide services like preparing returns for individuals and small business owners.
The key differences between a CPA, bookkeeper, and an accountant are:
- the level of detail in which financial transactions are recorded;
- the type of analysis an accountant provides; and
- the authority to provide a company’s official financial statement.
Bookkeepers keep track of all the money going in and out of a company, accountants go beyond that to analyze what it means financially, and CPAs can give companies an “official” statement of their finances – certified by the state. So if you’re looking for someone to help you manage your business’ money, make sure you know what kind of professional you need!
5. Which one do you need
So, which one do you need? If you just need someone to keep track of what’s going in and out, a bookkeeper is a right person for you. But if you want someone who can give you an in-depth analysis of your company’s financial situation, then you need an accountant. And if you’re looking for someone with the authority to officially say how healthy your company finances are, then you need a CPA!
In conclusion
Picking Las Vegas CPA professionals can be a daunting task, but the three main differences between the professions can help you make the best decision. Don’t forget to analyze your businesses’ needs, and you’ll be one step closer to choosing CPA for medical professionals and other CPA professionals that will help your business.
Story by Joseph J. Hall
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