What’s the Difference Between a Bookkeeper and an Accountant

What’s the Difference Between a Bookkeeper and an Accountant
For many small business owners, in fact most laypersons outside of the world of business and finance, the terms bookkeeper and accountant blend into a hazy configuration of people who handle the numbers of business.
It is like a riddle. If a bookkeeper keeps books, and an accountant accounts for accounts, what is the difference between the two?
This is a question we are often asked and on the AIS Solutions website we attempt to address it by offering a detailed explanation of a bookkeeper, along with both the old and the new definitions for bookkeepers.

Bookkeepers then and now

The old definition is that a bookkeeper is a person who records the day-to-day financial transactions of a business. He or she is usually responsible for writing the books, which contains records of purchases, sales, receipts and payments.
But that description no longer fits the role of the modern bookkeeper.
Today, a more accurate definition is: A bookkeeper is a management accounting professional, still responsible for the day-to-day financial transactions, but often specializing in financial compliance, business strategy, technology setup, execution and maintenance.
Just as the bookkeeper’s role has changed in the business environment, so has the accountant’s. As the Canadian Chartered Professional Accountant’s website puts it, today’s accountant is not just a number cruncher.

Changing role of accountants

Accountants are typically responsible for interpreting, classifying, analyzing, reporting and summarizing financial data but they are also tax planners, advisors, business owners and executives.
The CPA group advises that accountants play key roles within diverse segments of the economy including industry, public accounting, government, education and the not-for-profit sector.
“They offer a strong set of accounting and managerial skills required for today’s complex and evolving environment,” the website suggests.
While the roles of bookkeepers and accountants are evolving, they still share common goals and support businesses to maintain excellent records within the various stages of the financial cycle.
If both are growing in their roles to offer business insight and even strategies for such things as tax preparation, what are their differences? Much of it comes down to functions.

Functions of each position

The bookkeeper generally records financial transactions, posts debits and credits, creates invoices, reconciles and balances the general ledgers and historical accounts, and often completes the payroll.
In most companies, the accountant then uses the information that the bookkeeper has compiled doing these tasks to produce financial models to assist the company in making short and long term business decisions.
The accountant also prepares audited or non-audited financial statements including Notice To Reader for the year or for shorter time periods, analyze the costs of operations, and prepare the corporate income tax return.
A good accountant and a good bookkeeper can both offer the business owner insight into what will likely occur if certain financial decisions are taken.

Broader strokes of the professions

The accountant tends to be the painter of the bigger picture in a business, revealing profitability and staying aware of cash flow. They do this using the information from the bookkeeper even though both bookkeeper and accountant may be involved in strategic tax planning and the path the company is taking.
Some of the things that only accountants did in the past, bookkeepers do now, so a task analysis isn’t the only way to determine the difference between the two careers.
Both professions require training and a dedication to detail and knowledge about key financial areas such as business growth and taxation.
In Canada, bookkeeping, unlike accounting, is still an unregulated industry, meaning there is no one set of consistent standards for training which a bookkeeper must possess. However, some companies, such as AIS Solutions, require all the bookkeepers they hire to pass in-house certification examinations. (We also offer our examination to other companies who wish to test their bookkeepers.)
Being certified ensures that the bookkeeper is more than a data entry person. It means they are knowledgeable about payroll, GST and HST, and debits and credits.

Training for accountants

Accountants can also have varying degrees of training. CPA Canada is the national organization established to support unification of Canadian accounting professionals under the Chartered Professional Accountant designation.
They offer a certification program that allows accountants from coast to coast to be recognized as professionals who have the technical knowledge of advanced financial reporting, management accounting, strategy and governance, audit and assurance, finance and taxation.
They also designate “enabling” skills needed to be certified and these include professionalism, ethical behavior, written and oral communication, leadership, problem solving, and decision making.

Figuring out what help you need

How does a small business owner determine if they need a bookkeeper, an accountant, or both?
Generally speaking, a lot depends on the financial expertise of the business owner and the size and complexity of the business. Small firms may need support from a bookkeeper who has knowledge of key areas like GST/HST and payroll and even tax preparation. Sometimes they rely solely on a bookkeeper day-to-day, and bring an accountant in periodically to do an overview of their books and ensure that they are not missing out on important deductions or tax strategies or other financial advice.
There are exceptions, but as a general rule of thumb, if your annual revenue is in the high six figures or more, you will benefit from a solid collaboration of a skilled bookkeeper as well as an accountant who can offer sound financial advice, intricate tax planning strategies and other big picture advice.

Getting the most out of your money

The best bookkeeper is generally less expensive than the accountant, so they are greatly in demand by small businesses who rely on their day-to-day expertise. A good bookkeeper also serves as a look-out for any serious financial issues that may arise, and knows when to recommend calling in additional knowledge from a skilled accountant.
Some very small companies have owners who try to manage their finances on their own but need weekly or monthly help in ensuring all accounts are settled and that everything is filed in the right place.
There is no one size fits all when it comes to bookkeepers and accountants for individual business. Each one is unique and all that is known for sure is that investments made to ensure financial matters are handled properly and professionally is still the best investment a company can make in its long-term success.
The latest industry survey reveals that a small business is 5 times more likely to succeed if they work with a professional bookkeeper and Accountant.
Thanks for reading. Until next time, take care.
This blog is for you and we hope you will enjoy the content.
Please let us know if there are any specific topics you would like us to address in the future.
Copyright: damedeeso / 123RF Stock Photo

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Steve Loates

Steve is the co-owner of AIS Solutions and Co-founder of Kninja Knetwork. In 2017, his firm was named Intuit's Global Firm of the Future, the first time the title has ever been awarded to a firm outside of the United States. He has also has been named as one of the Top 10 Influencers in the Canadian Bookkeeping Industry. He has been a small business owner for over 30 years and has helped to develop a number of businesses including bookkeeping, online training, digital marketing, website development, e-commerce and retail. Steve passion is educating and supporting small business and when he is not creating online courses he is delivering workshops and webinars across North America and the Caribbean including presentations at QB Connect, Connected, IPBC, CPA The One and Scaling New Heights.


  1. Denise Schofield

    I jHi Steve
    I read your post and am very interested in the bookkeeping exam that you have indicated.
    Our firm is in the process of hiring bookkeepers that are qualified and trained and most importantly knowledgeable in regards to the cloud solution for keeping the books using QBO and related apps.
    I look forward to hearing from you.

  2. Denise Schofield

    I must apologize for the extra characters that appeared at the beginning of my message. My phone was not behaving.
    Kindest regards,
    Denise Schofield


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