For those unfamiliar,the term “accounting” and “bookkeeping” are often used interchangeably. However, for those unfamiliar, append below some of the difference:
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ACCOUNTING: |
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Accounting is a four stage process of recording, classifying, summarizing and the interpretation of the financial statements. The four stage process are defined below: Recording- transactions being recorded in the books of the business Classifying- sorting and categorizing into meaningful and orderly types or manners Summarizing- the accounting data are summarized Interpreting- financial data are analyzed and used to assist decision making |
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BOOKKEEPING: |
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Bookkeeping is a part of Accounting. It is merely a mechanical aspect of recording, classifying and summarizing transaction. Therefore, keeping the books of accounts is always the theme in bookkeeping. The finer aspect of interpreting all these data into information for management to act upon is excluded. |
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