Difference between Bookkeeping and Accountancy

Bookkeeping and accountancy are tools used for recording and analyzing the transactions and also maintain the records of transactions which happen on a daily basis in the company. Given below are some of the differences between Bookkeeping and Accountancy –

  1. Bookkeeping refers to recording of business or financial transactions like purchase done, sales made, daily payments etc…, by the company but accounting is concerned with not only recording of above transactions but also making various adjustments like outstanding payments, depreciation, prepaid expenses etc…, and then presenting it to the other parties in the form of balance sheet and profit and loss account.
  2. While bookkeeping is more clerical in nature in the sense that same set of transactions have to be recorded and hence it does not require any specialize degree whereas in accountancy there are many dynamic situations which happen and therefore it requires specialization and not everyone can face and deal with such dynamic situations.
  3. While the work of bookkeeping usually ends with trail balance whereas the work of accountancy usually starts with trail balance and ends with presentation of balance sheet and profit and loss account to the top management. Hence one can say that bookkeeping is the basis of accountancy.
  4. The emphasis of bookkeeping is on accuracy of books of accounts whereas the emphasis of accountancy is much wider and it involves interpretation of financial statements and if the company has not done well then finding the causes behind such performance.
  5. Accountancy has many branches like financial accounting, management accounting, cost accounting and so on while bookkeeping does not have any such branches.

As one can see that there are many differences between the two one should not make the mistake of thinking that accountancy does not require bookkeeping because they both complement each other rather than competing each other.

0 comments… add one

Leave a Comment


Related pages


capital convertibilityfull form fdiactivity based budgeting disadvantagesadvantages of autocratic leaderadvantages and disadvantages of social marketingadvantages of an autocratic leadership styleincome method to calculate national incomewho is an autocratic leadernostro accountswhat is urbanisation for kidsdisadvantages of target marketingsemi durable goods definitionaccounting unearned revenuecapitalism weaknessesdisadvantages of economic growthunsystematic risk exampleimportance of capital budgeting pptadvantages and disadvantages of earned value analysismarket skimming pricing examplesbenefits of demat accountcash inflow examplesfloating currency definitiondefine foreign exchange reservesadvantages and disadvantages of mixed economy pdfbenefits of ppfrent receivable journal entrypollution advantages and disadvantagesunbilled fees adjusting entrywhat is the difference between direct and indirect laborsemi durable goods examplesaccounts receivable and unearned revenuecontingent liability examplespros of autocratic leadershipdrawbacks of venture capitalskimming policyexample of diversifiable riskexample of primary industrymerits and demerits of globalizationjournal entry for prepaid rentcost oriented pricing examplewhat does the word consignment meanmeaning of wholesaler and retailerdiscounting billwhat is planned economy definitionzero based budgeting pros and consthe difference between socialism and capitalismbenefits of a swot analysishow to prepare fund flow statement from balance sheetaccounting fifo methoddrawer & draweedisadvantages of debenturesvertical merger exampleprivatisation in india ppthow to prepare fund flow statement with examplestock turnover ratio interpretationconsignee meaning in englishaccounting entries for purchasesexamples of accounting conventionswhat does the word consignment meanexamples of consumer durablesadvantages and disadvantages of stock market investingdirect fx quoteconglomerate integrationwhat is meaning of consigneedcf techniqueswhat is a floating currencyconglomerate organizationdefine inferior goods in economicsadvantages of dematerializationexample of market penetration pricing strategymeaning of discounting of billsfx direct quote