Bookkeeping vs. Accounting

Recognizing the difference between bookkeeping and accounting can be confusing. While

both are a part of the accounting cycle, bookkeeping is the inputting of data and accounting

is the interpretation of that data.

The cycle diagram shows a summary of the accounting cycle. The dark blue circles represent

the activities usually performed by a bookkeeper. These include journal entries, ledger

accounts, unadjusted trial balance and financial statements. The light blue circles represent activities that are typically completed by an accountant. These include adjusting

entries, adjusted trial balance, closing entries and post-closing trial balance. However, an accountant or a more experienced bookkeeper may execute the entire cycle.

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