Deciding on an accountant or bookkeeper

Just because you run your own business doesn't mean you are a financial guru. It is not uncommon to find yourself staring at your financial statements struggling to make sense of everything and you may find it easier to employ the services of an accountant or bookkeeper to help you out. But who do you call and is there even a difference between the two?

The team at FlyingSolo.com.au recently released an article that will help you define each position and make a more informed decision as to what your business needs. In some cases you may find that you need no assistance, but other times there is a possibility that you will have to hire more than one professional to help you with your daily activities.

Bookkeeper

Bookkeeping refers to the processing and recording of transactions made in the accounting process such as receipts, bills and the preparation of invoices. By employing a bookkeeper you can make sure you avoid any costly mistakes that could affect your business. However, it's important to note that although bookkeepers are responsible for maintaining these documents, they are not accountants.

BAS agent or professional bookkeeper

BAS agents exist only in Australia specifically because of the requirement from the ATO to complete Business Activity Statements (BAS) in the accounting process. A BAS agent is required to be registered, therefore the role of a BAS agent is slightly more sophisticated than the role of a regular bookkeeper as they are responsible for the set up of accounting systems, coding transactions and dealing with complicated GST issues. As BAS agents prepare financial documents relevant to the ATO, the more often you report to the ATO the more likely you are to employ the services of a BAS agent.

Tax accountant

Similar to a BAS agent, tax accountants are required to be registered with the Tax Practitioners Board, meaning they offer a more specific and sophisticated service then regular bookkeepers. Generally speaking tax accountants are influential in the early stages of the business as they help you set up your business structure, minimise tax and help to prepare financial statements. However, as your business continues to grow and progress through the business lifecycle, you may find that you only call on your tax accountant when the end of the financial year comes around.

Management accountant

Your management accountant will be different to your tax accountant and will most likely provide help to your business at a later stage when it is enjoying growth. The work conducted by your management accountant will help you make informed decisions for your business moving forward as they are experts in outlining strategic planning, cash flow and budgeting.

Regardless of the different qualifications that exist amongst the discussed positions, each will have a different role to play in your business moving forward. Tax accountants are more likely to be there when you start your business and at the end of each financial year but you may decide that you require a bookkeeper to help with your day-to-day activities to simplify the process come end of financial year. The most important thing is that you employ the services of these professionals based on the current position of your business.

Think you can do it yourself? Make sure you avoid these common accounting issues.

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