We’re not at war, I promise! Bookkeepers and accountants are not competing for the same work, their roles a very complementary to each other and both have an important role in your business.
An accountant prepares your tax return at the end of the financial year. They view your business on a more holistic level, using their expertise to find the ways to manage your tax and save you money.
A bookkeeper handles the financial side of your business year round, from the day to day, to getting figures prepared and ready for the accountant at the end of financial year.
There are a few areas where accountants and bookkeepers can overlap. A bookkeeper who is a Registered BAS Agent is qualified to lodge your BAS’s and IAS’s (see previous blog ‘Is your bookkeeper qualified?’). Your accountant is a Registered Tax Agent and they are qualified to lodge your BAS’s and IAS’s as well as your tax return. In terms of Payroll, preparation of your employee PAYG Summaries can be prepared by your accountant or bookkeeper.
A bookkeeper and accountant work together to fulfill the financial obligations of your business. You cannot replace an accountant with a bookkeeper and if your accountant is doing your bookkeeping I’m sure they are doing a great job, but that you are paying a hefty sum for it!
I speak to a lot of business owners and a lot of accountants. The primary complaint many business owners' have about their accountant is often fees. They do a great job, but why does it cost so much? Accountants charge by the hour and because they are specially trained, their hourly rate is often high. If your accounting invoice is higher than expected it is often because your accountant has had to spend a lot of time ‘bookkeeping’ that is, checking and changing your figures. The accountants I have spoken to actually don’t like giving you a giant invoice, but if they had to do the work, they have to charge for their time. So what’s the solution? Bookkeepers. We’re qualified and cheaper than your accountant. Plus bookkeepers who are Registered BAS Agents can lodge your BAS’s and IAS’s too saving you even more money! And the less time your accountant has to spend bookkeeping the more time they can spend doing what they do best, saving you tax!
Don’t worry, your accountant wont be offended if you get a bookkeeper, on the contrary. Having a fastidious bookkeeper means that your accountant can rely on the accuracy of the figures we present to them. We can do things like account for assets and reconcile balance sheet accounts, things that the average business owner may not really understand or have the time to do. This means your accountant doesn’t have to do it! An accountant only sees your figures once or a few times a year and usually at the busiest times. If things have been coded incorrectly and the accountant misses them in the small amount of time they have to review the figures you may have missed out on a tax deduction. And if he or she does take the time to review the figures in detail? There’s that giant accounting bill again.
Accountants and bookkeepers have complementary training and qualifications designed to cover all aspects of financial compliance for your business. Don't be afraid to speak to your accountant about whether a bookkeeper will be a beneficial addition to your business.