WHAT IS THE COMPARISON BETWEEN BOOKEEPING AND ACCOUNTING?


COMPARISON BETWEEN BOOKEEPING AND ACCOUNTING

Accounting is the process of identifying, measuring and communicating the economic information of an organization to various users who need the information for decision making
Thus, accounting entails the following activities:
1. identifying transactions and events,
2. measuring,
3. recording,
4. classifying,
5. summarising,
6. analyzing,
7. interpreting and
8. communicating.

Bookkeeping is a part of accounting which is concerned with the recording of business transactions on a day to day basis or maintenance of books of accounts. The nature of a bookkeeper's work is clerical and may be done using mechanical or electronic equipment. It only covers the first four activities of the accounting process

Having seen the relationship between bookkeeping and accounting, let us now look at their differences. Bookkeeping and accounting differ in the following aspects:
Scope: Bookkeeping covers the first four activities of the accounting process while accounting,   in addition to bookkeeping covers the last four activities of the process

Stage: Bookkeeping is the primary stage whereas accounting is the secondary stage. Accounting    continue where bookkeeping ends.

Basic objective: The basic objective of bookkeeping is to maintain systematic records of financial transactions while the basic objective of accounting is to prepare financial reports and statements based on the records as well as analysing & interpreting the reports.

Nature of job: The job of a bookkeeper is usually routine and clerical in nature while the job of an accountant is analytical in nature

Knowledge level: The bookkeeper is not required to have a higher level of  training and knowledge whereas the accountant is required to have a higher level of training and knowledge than the bookkeeper

Supervision and checking: The bookkeeper does not supervise and check the work of an accountant while the accountant supervises and checks the work of a bookkeeper.





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