The Accounting and bookkeeping are essential functions for the financial health and operational success of any organization. Though often used interchangeably, these terms represent distinct processes within the financial management of a business.
Bookkeeping
Bookkeeping is the systematic recording and organizing of financial transactions. This foundational process ensures that every financial activity, from sales and purchases to receipts and payments, is accurately documented. Bookkeepers maintain ledgers, journals, and other records, utilizing both manual and digital systems. Their tasks include:
- Recording financial transactions in chronological order
- Posting debits and credits to appropriate accounts
- Managing invoices and receipts
- Reconciling bank statements
- Maintaining a general ledger
By meticulously tracking financial data, bookkeepers provide the raw financial information necessary for more complex accounting processes.