Many small businesses are looking for someone to handle their records due to lack of time or experience, but are not sure of the different types of record keepers. There are bookkeepers, accountants and CPAs. Many know about accountants, but what is the difference between a CPA and a bookkeeper? The following information explains the CPA vs. Bookkeeper dilemma, in addition to which one is the best for you to work together with.
First, let’s start with the basics of what a bookkeeper and CPA are. A bookkeeper records the everyday transactions of a business. These include managing payroll, creating invoices and posting debits and credits. Bookkeepers do not possess the education of a CPA, although they generally have 2-4 years of experience or an associates degree.
CPAs, also called Certified Public Accountants, have acquired an education in accounting and have passed the Uniform Certified Public Accountant Examination. CPAs handle the more complicated records of a business, such as IRS auditing, tax services and financial services. A CPA oversees or works with bookkeepers to make sure business records are handled correctly.
So which one is best? If you are just looking for someone to keep track of your everyday records, then a bookkeeper may be a suitable choice for you. However, when it comes to the more important records, such as tax documents and tax advice, a CPA is vital for your business. Having both a bookkeeper and a CPA is the best choice. A CPA will review your financial records and advise you about finances and taxes. A CPA also can sign business tax records and represent your business just in case IRS issues arise.
Hiring someone to handle the books ensures the financial success of your business, in addition to allowing you to focus on other aspects of your business without worrying about making sure your records are appropriately handled. We at Reconciled It have the experience needed for handling your bookkeeping. For more information, feel free to contact us.