As you continue to grow in your business, the words "bookkeeping" and "accounting" seem to get more confusing. What is bookkeeping? What is accounting? and why does everyone use them interchangeably if they don't mean the same thing.
Simple definitions; Bookkeeping leans more towards compiling information of all your sales and expense transactions relating to your business, essentially recording all your financial transactions while accounting is a more technical and broader concept; through accounting, you get detailed insights and data into your business’s financial health based on all the information recorded during bookkeeping.
In this article, you'll get all the information required to understand both terms and the impact they have in helping your business grow and manage your finances.
Differences between Bookkeeping and Accounting
What is Bookkeeping in 2022?
Bookkeeping is a process of recording and organizing all the daily business transactions that have occurred in running the business. Bookkeeping is an integral part of accounting. Bookkeeping entails consistency in gathering the financial information needed to run a successful business.
What are the elements of Bookkeeping?
- To keep records of business transactions, both sales, and expenses
- Tracking debts and credits
- Creating and tracking invoices
- To prepare financial statements such as cash flow statements and income statements
- Managing payroll (Staff Salaries)
You can do most of your basic bookkeeping on the Kippa Bookkeeping app.
What is Accounting in 2022?
Accounting is the system of recording and summarizing business and financial transactions and analyzing, verifying, and reporting the results. It is the process that uses financial data compiled from bookkeeping to produce financial models.
What are the elements of Accounting?
- Reviewing your business’s financial statements
- Analyzing costs of operations; all the expenses incurred in running a business
- Processing income tax returns
- To help you make sound financial business decisions
So now that you know the differences between bookkeeping and accounting, let me give some information about what the Kippa app can offer you in your endeavor to grow your small business.
Currently, the online version of the Simple Bookkeeping app helps both small businesses and medium-scale businesses. Some of the resources the app provides are
- A data recording feature lets business owners track their everyday sales, expenses, and credit transactions.
- Keep track of your debts, and it even has a sweet feature that sends reminders to you within the app.
- It manages all your transaction data and information.
- Keeps tabs on the details of your inventory
- Organize and manage your shop within the app
Kippa is the future of bookkeeping in Africa with a sprinkle of accounting.
A crucial part of what the Kippa app does for your business is analyzing financial reports to help you make better business decisions; help you understand cash flow. And overall, it gives you insights that reveal the bigger picture of how your business progresses.
A simple bookkeeping and accounting app like Kippa gives your business a way to measure your overall performance. It also provides information to make decisions related to your business, and it helps you ascertain your revenue and income. Therefore, spending extra time and money maintaining proper financial records is essential. Download Kippa App now.