Welcome to the Online Accounting Guide
- Our aim is to help people, of all experience levels, to fully grasp the basics of accounting and bookkeeping. We do this by explaining all areas of accounting in a clear and easy-to-understand way. And to make things even easier, this is all for free!
What is the Difference Between Accounting and Bookkeeping?
These two terms are used together quite commonly and this can cause confusion for many people. While the two share many similarities there are some key differences.
Bookkeeping is a key part of keeping financial records of a business. Bookkeepers are responsible for entering all financial documents received into a business’ financial records. This includes recording sales invoices, purchase invoices, credit notes and purchase orders for example.
Once these bookkeeping records have been made, we now have figures to work with to carry out accounting processes. Accountants take the financial information compiled by the bookkeepers and use them to create financial statements. The financial statements can then be used to analyze the business’ performance, calculate tax liabilities, create forecasts and make decisions about the future of the business.
Therefore the key difference is:
- Bookkeeping = using source documents to compile financial information for the business
- Accounting = using the financial information to create the financial statements and analyze the performance of the business
Why Should you Learn Accounting?
Accounting is a useful skill for anyone involved in business. Understanding accounting can open up many doors within your career and can help you to understand businesses in more depth.
All businesses should follow the basic bookkeeping principles if they want to succeed and accounting helps keep track of profit, performance and budgets.
Who are Our Lessons Aimed At?
Our lessons are aimed at anyone who wants to learn the basics of bookkeeping and accounting.
Whether you are a student who has zero experience or someone with years of experience, we believe there is always something you can learn and we believe you will find this by browsing our posts.