Did you know that the accounting industry in the United States generates over $100 billion in revenue every year? Accountants are needed more than ever, and it is a lucrative industry that will always be needed.
Have you ever wondered about the difference between a bookkeeper vs CPA, and which one you will need for your business? Here is a brief guide so you can determine whether to hire a CPA or hire a bookkeeper.
What is a Bookkeeper?
A bookkeeper has the task of keeping all of your financial information up to date. Typically, they will use software such as QuickBooks to do so. They enter all of your expenses and revenue into the software and ensure that everything is organized.
Bookkeepers often scan in receipts and invoices as well in case they need to reconcile your finances at a later date. This information is helpful to have on hand for later, such as if you need financial statements or a tax return.
Your bookkeeper can also help you to reconcile accounts, pay bills for your business, and process accounts receivable. You can either hire a bookkeeper in-house or outsource the job.
CPAs are qualified to do bookkeeping, but not all bookkeepers can be CPAs. If you need basic accounting for your business, then you may be able to look at bookkeepers for hire and save some money in the long run as well.
What is a CPA?
A CPA stands for a certified public accountant. To become a CPA, you need to study for and take the CPA qualifying exam. Most CPAs take this exam after they earn an accounting or finance degree.
CPAs are qualified to prepare tax returns and in many cases, you can meet with your CPA for tax planning and financial planning purposes.
If you need an accountant who can handle tax matters for your business, as well as other aspects of finances outside the scope of a bookkeeper, then you should hire a CPA.
When it comes to cost difference, expect to pay more for a CPA. You will be paying for their knowledge of bookkeeping and accounting, but also expertise in the realm of financial planning and tax advice.
CPAs can work as independent contractors or they can be part of a larger accounting firm. In general, CPAs who work independently charge less than a big accounting firm, so make sure to weigh the pros and cons of each before you make a decision.
Bookkeeper vs CPA: Which is Right for You?
If you need financial help for your business, you should not have to worry about whether you need a bookkeeper vs CPA. With this guide, you can make an informed decision about what is best for your company’s needs.
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