Bookkeeping or accounting: which option is right for me?
There are several paths you can take if you want to work in finance, and the first thing to decide is whether to study accounting or bookkeeping.
When looking at the two subject areas, you will notice a certain amount of overlap in course content at level 2. This is because the basic principles underpinning bookkeeping and accounting are the same.
However, as you progress the two subjects become more specialised, so it’s important to make sure you are on the right study path.
The information and quiz below are designed to help you make that decision:
Bookkeeping is the day to day recording of financial transactions and information relating to a business, and can be broken down into specific areas such as accounts receivable, accounts payable, and payroll. In smaller companies, one person may handle all of these activities, whereas in larger organisations the bookkeeping function is often split into different roles.
Bookkeepers ensure that records are accurate, orderly, up to date and comprehensive and there is little if any analysis involved. This tends to involve a routine of daily and monthly systems that run throughout the year.
Bookkeepers can work individually or as part of a team and may be based in an office or from home.
Our ICB courses provide the ideal foundation for a career in this area by teaching all the key principles of bookkeeping and providing a licence to practice for those who complete level 3.
Accounting is the process by which information provided by a bookkeeper is analysed and reported, allowing progress to be monitored and forecast.
Accountants are responsible for setting up and overseeing the bookkeeping process, along with the preparation of statements concerning assets, liabilities and the operating results of a business, allowing key decisions to be made concerning the future direction of the organisation. As a result, accounting tends to be less routine and more subjective than bookkeeping.
Accountants tend to be office based and work closely with other people, both within the finance department or a company’s senior management team.
The AAT pathway provides a solid understanding of bookkeeping functions while also preparing you for more advanced roles within chartered accountancy.