Nonprofit Bookkeeper vs Accountant Who Should You Hire?

While accounting can be a lucrative long-term career, most accountants, unlike corporate attorneys or investment bankers, do not command huge salaries during the first few years. There are various career paths for accountants (and some for bookkeepers), from working as a forensic accountant to becoming a financial auditor or an enrolled agent. Unlike careers such as law and medicine, in which state licensing boards determine how much education you need, with accounting and bookkeeping, the companies doing the hiring decide what to require of candidates. When looking for a certified bookkeeper, first decide if you want to hire an independent consultant, a firm or a full-time employee if your business is large enough.

This includes where your business stands financially, what that means for your business, what you should do about it if anything, and where your business should go from here. A bookkeeper maintains the financial records of business transactions on a daily basis. Bookkeepers are essentially keeping track of all the money that comes in and goes out of the business.

Small Business Accounting Services

University of Phoenix does not guarantee employment, salary level or career advancement. Information for a specific state/city can be researched on the BLS website. In-house accounting, on the other hand, gives you peace of mind knowing that someone you know and trust is handling your books and financials.

• As an accountant, you may have to crunch numbers, but those are not the only skills needed.
• The bookkeeper can be found working in small, medium, or large business organizations.
• Though they both work with financial statements, their daily duties are distinct, and they rely on different software, tools and processes.
• Whenever funds change hands or data needs to be recorded regarding nonprofit finances, a nonprofit bookkeeper is responsible for keeping those records up-to-date and organized.
• As you’ve seen, there are several solutions to this bookkeeping dilemma, but they also come with additional questions you should keep in mind before making a decision.
• To maximize earning potential and secure long-term job stability, it’s worth pursuing a career as an accountant.

You must have a minimum of 150 postsecondary education hours, or what amounts to a bachelor’s degree in accounting, and an additional 30 hours of graduate work. For example, some small business owners do their own bookkeeping on software their accountant recommends or uses, providing it to the accountant on a weekly, monthly or quarterly basis for action. Other small businesses hire a bookkeeper or employ a small accounting department with data entry clerks reporting to the bookkeeper. Bookkeepers and accountants both work with financial records, but accountants have a higher level of responsibility.

Accounting qualifications

Bookkeepers don’t necessarily need higher education in order to work in their field while accountants can be more specialized in their training. Because bookkeepers tend to work for smaller companies, they may not be paid as much as accountants. Knowing the differences between the two can help people find their niche in the industry and can give guidance to companies on who to hire for their needs. Accountants and bookkeepers both can offer valuable insight into your business’s financial situation, helping you make better decisions around cash flow and stay prepared when it comes to tax liabilities.

• Demonstrating a high level of proficiency can reassure employers that you’re equipped to take on greater responsibility, significantly raising your earning potential.
• Bookkeepers are responsible for entering the data into the books and keeping the records up to date.
• Other small businesses hire a bookkeeper or employ a small accounting department with data entry clerks reporting to the bookkeeper.
• As your business grows to include more customers, vendors and employees, keeping track of your finances on your own becomes more challenging.
• Another key responsibility for accountants includes conducting routine audits to ensure that statements and the books are following ethical and industry standards.
• The top-earning 10 percent of accountants received $111,510 annually or higher, while the top 10 percent of bookkeepers received $54,310 per year or more.
• This decline can be attributed to the role of technology in automating many of the transactional functions of bookkeepers.

Consider, however, the most highly specialized accountant probably isn’t going to be earning in the 95th percentile if he or she is working in a smaller, less complex organization. At the same time, there exist some larger, more complex firms that pay their entry-level CPAs more than smaller firms pay junior CPAs. Accounting represents a deep, diverse range of potential job opportunities demanding a variety of skills. How much you can make depends on many factors, including industry of employment, specific job duties, your experience, and college education earned. In this article, we’ll explore the differences between Bookkeepers, Accountants, Controllers, and CFOs.

questions to ask yourself before hiring a bookkeeper

For small businesses, adept cash management is a critical aspect of survival and growth, so it’s wise to work with a financial professional from the start. If you prefer to go it alone, consider starting out with accounting software and keeping your books meticulously up to date. That way, law firm bookkeeping should you need to hire a professional down the line, they will have visibility into the complete financial history of your business. The NACPB offers credentials to bookkeepers who pass tests for small business accounting, small business financial management, bookkeeping and payroll.

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• Accountants also need to keep their credentials and education up to date, so there are usually requirements for annual training and courses to keep their skills current.
• An additional 23,650 highly paid accountants averaged $90,560 working for the federal government.
• This range includes candidates who have a higher-than-average amount of experience, have a strong skill set compared to most of their peers, and who may occupy a fairly complex role or work in a competitive field or location.
• It is not an unusual career move for a bookkeeper to gain experience at a job, study, get certified, and work as an accountant.

If your business already has a bookkeeper, but you begin to struggle with legal financial questions, it might be time to hire an accountant. But if you work in a very tax-specific area, you might think of hiring both professionals for accounting and bookkeeping needs. In the U.S. accountants need to have at least an undergraduate degree in accounting, or more rarely in finance or business. Those wishing to work for larger companies pass the examination necessary to become a Certified Public Accountant (CPA) granted by The American Institute of Certified Public Accountants (AICPA). Certified Public Accountants can represent their clients before the IRS, work for a public company, and assist with an array of official bureaucratic and financial matters on all levels. Typically, professionals in bookkeeping and accounting spheres work together.