What is the difference between a CPA and a Bookkeeper?

Bookkeepers and Certified Public Accountants (CPAs) are accounting professionals, which is why both can be referred to as your “accountant”. In many situations, a CPA can perform tasks a bookkeeper performs, and a bookkeeper can perform some tasks a CPA performs. 

• A bookkeeper's main role is to maintain a systematic, accurate, consistent, and organized record of a company’s financial transactions. 

• A CPA will typically file the year-end tax return, can represent your business to the IRS, and can help manage wealth and reach financial goals. The CPA should also advise you on the amount your estimated tax payments should be based on your income and expenses (both personal and professional).

At Business by the Book, we consider your CPA a colleague, and we work together as part of your team. We respect their input when it comes time to prepare taxes. We typically perform all the bookkeeping tasks (categorizing transactions, reconciling accounts, filing sales tax returns, accounts payable, accounts receivable, payroll, etc.), while your CPA files your year-end tax return and helps you prepare for paying your estimated taxes throughout the year.

We recommend that you hire a CPA as soon as you decide to start your business, and the CPA that you choose should be familiar with your industry. If you are in need of a CPA, please let us know and we are happy to provide you with a few references.