Bookkeeping is the process of systematically recording all financial transactions in an organization, such as sales, purchases, receipts, and payments. It ensures that financial data is organized and up-to-date.
Accounting, on the other hand, goes beyond recording. It involves summarizing, interpreting, analyzing, and reporting financial information to provide insights for decision-making. Accountants use bookkeeping data to prepare financial statements, conduct audits, and offer strategic advice. Both functions are crucial, with bookkeeping serving as the foundation for accurate accounting.
