Bookkeeping service

Bookkeeper vs. CPA, What’s the Difference?

“Bookkeepers vs. CPAs, what’s the difference?” is quite a common question in the business landscape. Bookkeepers and Certified Public Accountants (CPAs) are essential professionals in the business landscape. Any established entrepreneur can attest that a good bookkeeper and CPA can make a world of difference in the business’s financial performance.

However, one must remember that a bookkeeper is not a CPA and vice versa. While both work with financial records, there is a myriad of differences between the two. There are differences in levels of education, professional qualification, expertise, and responsibilities. 

Are you wondering which financial professional is right for your business- a bookkeeper or a CPA? This article explores the various differences between the two professions, including their professional responsibilities, qualifications, and career paths. Let’s explore the differences and find the perfect fit for your unique needs.      

Professional Responsibilities of Bookkeepers

Accurate Maintenance of Financial Records

As the name suggests, the primary responsibility of a bookkeeper is to “keep” the books i.e., accurately and regularly maintain the data within the business’s books of accounts. Tasks such as recording financial transactions and reconciling bank statements fall under a bookkeeper’s responsibilities. For the most part, a bookkeeper’s work is more about data collection, categorization, and preservation. Any competitive business needs a dedicated bookkeeper to keep its financial data in order so that the company does not run into issues like erroneous financial data entry or misplaced financial records.

Preparation of Financial Statements

According to Expertise Accelerated publication titled “The Guide to the Four Basic Financial Statements”, Financial statements are a record of a business’s finances over a period of time. Financial statements contain essential financial information such as details of assets, liabilities, income, expenses, etc. Financial statements in essence are a formal, historical record of the business’ finances that can be used to evaluate business health and performance.

The key word to note is “record”. A bookkeeper’s primary duty is to record and compile financial information, and financial statements fall right in their wheelhouse. It is important to note that while bookkeepers can certainly generate a business’ financial statements, they cannot provide any analytical feedback or opinions pertaining to the contents of the statements. The bookkeeper’s responsibility ends when the records have been created and maintained. Another important factor to note is that not all bookkeepers are capable of generating financial statements. While it certainly falls within their range of duties, generating financial statements is still a difficult responsibility and requires experience and industry expertise. 

Payroll Management

Bookkeepers play a crucial role in managing payroll for a business or organization. They are responsible for ensuring that all employees are paid accurately and on time. This includes tasks such as calculating and withholding taxes, deductions, and other deductions from employee paychecks, preparing and issuing paychecks or direct deposits, and maintaining records of all payroll transactions.

Professional Responsibilities of CPAs

Tax Planning

One of the main duties of a CPA is preparing for tax season. Taxation is incredibly tedious and involves complex legal maneuvering, all of which a CPA is deeply familiar with as part of their training and education. Therefore, they can take over the responsibility of the business’ taxes, ensuring that the business is operating in compliance with tax regulations, as well as calculating taxes and minimizing the business’ tax liability. CPAs can help entrepreneurs plan in advance, providing strategic advice throughout the fiscal year to maximize tax savings. 

Financial Forecasting

Certified Public Accountants (CPAs) play a critical role in financial forecasting for businesses and organizations. While bookkeeping may entail generating financial statements, it is the job of a CPA to decipher the raw data present in the financial statements into meaningful information for the business. Financial forecasting is the process of estimating future financial performance based on historical data gleaned from the business’s financial statements and current trends. CPAs use their expertise in accounting and finance to analyze financial data and make informed predictions about a business’s future financial performance. This includes tasks such as creating budgets, financial projections, and cash flow forecasts.

Audit Planning

CPAs are also responsible for planning and successfully conducting financial audits for a business. In a nutshell, an audit is an official inspection of a business’s operations, processes, or financial records. There are two types of audits, namely internal and external. EA publication titled “Internal Audit vs. External Audit: What’s the Difference?” provides an in-depth explanation of auditing for any curious entrepreneur. 

The important takeaway here is that CPAs are the ones conducting audits, and they are licensed to do so. A bookkeeper cannot perform auditing duties, and while they may help with preparing for audits by compiling financial data, ultimately the audit is the responsibility of a CPA. 

Financial Advisory

CPAs also assist businesses in identifying potential financial risks and opportunities and provide guidance on how to best manage them. They also assist businesses in developing financial strategies that align with their overall business goals. With their knowledge and expertise, CPAs are able to provide valuable insights that can help entrepreneurs make informed decisions and plan for the future.

Qualifications for Bookkeepers vs CPAs

Bookkeepers are not required to be licensed or certified. They may have a degree in accounting or a related field, but it is not a requirement. However, bookkeepers may choose to pursue certifications such as the National Association of Certified Public Bookkeepers (NACPB) certification or the American Institute of Professional Bookkeepers (AIPB) certification to demonstrate their knowledge and skills.

CPAs, on the other hand, are licensed and certified professionals who have passed a rigorous exam and meet educational and experience requirements set by their state board of accountancy. To qualify as a CPA, one must have a bachelor’s degree in accounting or a related field, pass the Uniform CPA Exam, and meet the experience requirements set by their state board. Additionally, CPAs must also meet continuing education requirements to maintain their license.

Career Paths for Bookkeepers vs CPAs

The career paths for bookkeepers and CPAs also differ. Bookkeepers are typically employees of a company or organization, while CPAs often work independently or as part of a larger accounting firm. This means that bookkeepers generally work with one client at a time, while CPAs may work with many clients at once.

Additionally, the opportunities for advancement for bookkeepers and CPAs are different. While bookkeepers may be able to advance to supervisory or management positions within a company, their opportunities for advancement are typically limited. CPAs, on the other hand, have many opportunities for advancement, such as becoming a partner in an accounting firm or a Chief Financial Officer (CFO) of a company.

In terms of earning potential, CPAs tend to earn higher salaries than bookkeepers. According to the Bureau of Labor Statistics, the median annual salary for bookkeepers in 2021 was $45,560 per year, while the median annual salary for CPAs was $77,250.


In conclusion, bookkeepers and CPAs both play important roles in the financial industry, but they have distinct responsibilities and qualifications. bookkeepers are responsible for maintaining records of financial transactions and other administrative responsibilities while CPAs are responsible for analyzing and interpreting financial information and providing advice to their clients. 

Expertise Accelerated, The One-Stop-Shop for Your Accounting Needs

Whether it be bookkeepers or CPAs, one universal fact is that such professional services do not come cheap. For many small businesses, the services of such professionals are hardly worth the price tag, and so they must operate without financial experts on the team. This can be a massive hindrance to small businesses, stunting growth and negatively impacting revenue. 

Luckily, Expertise Accelerated’s unique outsourced bookkeeping services provide entrepreneurs with some much-needed reprieve. EA prides itself on building bridges between US entrepreneurs and offshore accounting professionals. By leveraging EA’s staff augmentation solutions, entrepreneurs can gain access to a gold-standard pool of accounting professionals at a fraction of the US cost. Vetted by US accounting industry veteran Mr. Haroon Jafree (CPA), EA provides small businesses the chance to leverage remote accounting resources on par with their US counterparts at a substantially lower cost. Whether it be a bookkeeper or accountant, EA is your one-stop shop for cost-efficient accounting solutions.