Accounting and Bookkeeping are both very essential financial functions, and while they might be mistaken to be the same thing – they’re actually very different from one another.
Let’s first understand what each one stands for! Bookkeeping is the art of identifying and maintaining accounts and financial statements. Accounting is the process of summarizing, interpreting, and analyzing financial transactions which were classified in the records. This stands to be the basic difference between Accounting and Bookkeeping.
They’re very inter-dependent but they have their share of similarities and differences – and many accounting firms in Dubai can take you through the same process.
The major difference is that the management can never take crucial decisions based on bookkeeping records, they would need a thorough analysis which can be provided by tax firms, to be able to take important decisions in the business. Also, the next major difference would be the objective why both these functions are carried out – Bookkeeping is done to maintain records in one place and to be able to serve it as and when required, while the objective of Accounting is to understand the standing of your business. It helps you gather exactly where you stand in the financial world, and what needs to be taken care of.
Also, another important thing to note is that bookkeeping is a direct process and doesn’t require specialist skills whereas Accounting requires a specialist to make important and relevant inferences and help the management take decisions.
Coming to the similarities, it must be noted that to get into bookkeeping or accounting, one needs to hold basic accounting knowledge. And when working in smaller firms, professionals simply follow the accounting process instead of bookkeeping. While they may not hold the specialist degree, they’re able to do these tasks because accounting software’s make this classification easy.
However, it’s best to let the best audit firms in Dubai, TRC Pamco, handle the process for you, since they are better equipped with a team of knowledgeable and experienced professionals, and are known as the leading VAT firm and Tax firm in Dubai.
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