Does a bookkeeper need an accounting degree? Believe it or not, there are actually no formal educational requirements for a bookkeeper. In fact, the owner or a family member often tackles the bookkeeping for a small business. However, many savvy bookkeeping professionals do pursue associates degrees and professional certification to improve their skills and their employment opportunities.
What is Bookkeeping?
Bookkeepers handle the details of a company’s day-to-day financial business, but their primary responsibility is data entry. They are typically expected to process the company’s payroll, record bills received from vendors, pay their company’s bills, prepare invoices for sales, mail out bills to customers and input any payments received. While doing so, they must keep an accurate record of the details of all these transactions.
How is Bookkeeping Different From Accounting?
Although many people use the words interchangeably, bookkeeping and accounting are not the same thing. Bookkeeping is a matter of recording financial transactions and other data. Accounting involves analyzing financial records to uncover trends and other information that may be helpful in decision making, strategizing and future planning. The two fields work hand in hand to provide businesses with an accurate financial picture, according to Business News Daily. Accountants rely on bookkeepers to provide them with accurate data that they can evaluate and interpret to form helpful reports and recommendations. Simply put, bookkeepers gather all the pieces of a business’s financial jigsaw puzzle in one place and lay them out neatly. Accountants put those pieces together to form a picture that business owners and other decision-makers can use to help make their business stronger.
What Education is Required to Become a Bookkeeper?
While there are no real educational requirements to become a bookkeeper, it helps if you are comfortable working with numbers, have an eye for detail and possess basic computer skills. Familiarity with bookkeeping programs like Peach Tree and Quick Books is also valuable. When businesses hire entry-level bookkeepers, they often expect to provide on-the-job training and only require applicants to have a high school diploma. Others prefer to hire people who have earned a two-year associate degree in bookkeeping, accounting or business. Some businesses choose to hire certified bookkeepers.
What is a Certified Bookkeeper?
A certified bookkeeper is one who has passed the certification exam of the American Institute of Professional Bookkeepers, the national association for the bookkeeping professionals. In order to be designated as a certified bookkeeper, individuals must pass a four-part exam that tests their knowledge and skills on the topics of payroll, depreciation, adjusting entries, error correction, inventory, internal controls and fraud prevention. They also need to have the equivalent of at least two years of full-time bookkeeping experience, which can be completed before or after the exam. Since it reassures potential clients of their abilities, this designation can be particularly beneficial to freelance bookkeepers who run their own bookkeeping businesses instead of working directly for one company.
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Bookkeeping and accounting both deal with numbers and financial data, but they are two distinct fields with different purposes. Bookkeepers handle everyday financial business and strive to create an accurate record. Accountants assess and evaluate financial information with the goal of providing useful interpretations. Although many choose to pursue associates degrees and professional certification, no bookkeeper needs an accounting degree or any other formal education to begin their career.