The Synergy Between Bookkeepers And Accountants
While bookkeepers and accountants both perform different tasks, they operate in synergy with one another.
Your bookkeeper handles the day to day aspects of your business financials. They are experts at ensuring all of your financial records are kept tidy, up to date and correct. This then allows your accountant to complete your tax and continuity analysis with ease. You can be 100% certain that the records being submitted to the IRD are exactly as they should be.
Without a great bookkeeper on your team, your accountant has a much harder job. It may mean they have to correct transactions, fix errors or contact you for long winded explanations. This all costs time and money that you don’t want to spend!
The Role Of A Bookkeeper
The bookkeeper is the financial backbone of your business. They are the record keeper, responsible for accurately recording a wide range of business data.
Some of the tasks handled by a bookkeeper include:
- Balancing and maintaining general ledgers, including bank reconciliation
- Maintaining debtors and creditors
- Managing payroll
- Managing PAYE compliance
- Managing GST compliance
- Preparing accounts for financial year end
A bookkeeper monitors and records your accounts regularly so can pick up any mistakes early on. Plus, the accuracy of their work makes your accountant’s life easier at the end of the year, and can save you money on accountant fees!
When hunting for a bookkeeper, look for someone who has completed relevant financial courses and has great feedback. For extra assurance, source a bookkeeper who is a member of the Institute of Certified New Zealand Bookkeepers (ICNZB).
More experienced bookkeepers, who are usually Gold certified members of the ICNZB Association can also do high-end analysis and some do business coaching, as well as monthly reporting and management reports. They can also prep for trial balances and complete adjusting entries.
Here at Mankelow Accounts, we are ICNZB certified and are also the proud recipients of the ICNZB Bookkeeper of the Year award. So, we definitely know our stuff when it comes to bookkeeping!
The Role Of An Accountant
An accountant handles the next stage of the finances after data has been recorded by a bookkeeper. Their role is more of an analytical one: looking at the data provided by the bookkeeper, they provide insights and produce reports to help your business grow.
Although an accountant can handle bookkeeping work, this is not the best use of their time (or your budget!) Accountants charge much more than bookkeepers and are far more useful to you in a consultative capacity. They will make sure you are claiming everything you could/should be, and can advise on how to improve the performance of your business.
Accountants handle things like:
- Analysing and verifying data
- Generating various financial reports such as tax returns, income statements, and balance sheets
- Adjusting entries
- Providing guidance into business trends and growth opportunities
- Helping business owners make informed financial decisions
Nobody can call themselves an accountant without the appropriate qualifications, which generally involves many years of university study to obtain a degree, or being an Attains accounting association member.
In New Zealand, accountants can become Chartered Accountants by applying for membership of Chartered Accountants Australia and New Zealand (CAANZ). The membership requirements are stringent, involving years of experience and further qualifications.
Do I Need A Bookkeeper Or An Accountant?
Now that you know the difference between a bookkeeper and an accountant, you may be wondering which you need? Well, the short answer is that your business can benefit from having both. A bookkeeper will ensure that your finances are correct and on track on any given day of the year. They also complete all the preliminary work to make an accountant’s job easier.
Your accountant can then complete the high level analysis work on well maintained records. By having two financial experts on your team, you know that your business is in a great position.
So, if you need some help getting your finances in order, get in touch with us here at Mankelow Accounts. We work in close consultation with a wide range of accountants to ensure your finances are where they need to be! Get in touch with us today to see how we can help save your business time and money!