Many entrepreneurs starting small businesses do not have an accounting or bookkeeping background. Some of these entrepreneurs are highly educated professionals (Engineers, Computer Programmers, etc.). I encounter many of these highly educated professionals that assume that keeping the records for their small businesses is an easy task and can be delegated to anyone who can read and write. This attitude usually gets these small business owners into trouble during tax filing season.

What Is The Difference Between An Accountant And A Bookkeeper?
Accountants have a four year university degree (just as Engineers and Computer Programmers do). The Accounting profession has a standard set of rules to follow for keeping company records. This standard set of rules is called Generally Accepted Accounting Principles (GAAP). Accountants also have to follow the Internal Revenue Code (IRC) for tax purposes and the profession has many other sets of procedures and regulations too numerous to cover here.

Bookkeepers, on the other hand, do not need to have a four year university degree although many of them have some college training. Bookkeepers are usually highly trained on QuickBooks and have experience "categorizing" transactions in order to produce an Income Statement for the small business owner. This Income Statement is one of the documents that Tax Professionals use when preparing a tax return for the small business.

Most Bookkeepers have access to an Accountant for questions and guidance when producing the Income Statement or other Financial Statements such as a Balance Sheet, a General Ledger or a General Journal. Some Bookkeepers have regular oversight by an Accountant and some Bookkeepers only receive Accounting guidance during the preparation of the tax return.

Why Does A Small Business Need A Bookkeeper?
Most Accountants would not even attempt to design a bridge (as an Engineer would do) or to write a computer program (as a Computer Programmer would do). I am always baffled by highly educated professionals in fields other than Accounting that assume that they can do the accounting or bookkeeping for their small businesses. They do not possess the skills or the background (just as an Accountant does not possess the skills or the background to design a bridge or to write a computer program).

Bookkeepers bring both their QuickBooks skills and their knowledge of proper recordkeeping to the table.

We have a saying in the Accounting profession that "you cannot manage what you cannot measure". In order to manage your small business, you need to measure your progress.  Bookkeepers measure your progress.  Are you making money? What are you spending on materials, labor, administrative expenses? Where can you cut costs? Which of your products or services is making the most money (and which are making the least)?

When it comes to running a small business, one of the first people that you should hire is your Bookkeeper. Do not expect your Tax Professional to do your books during tax season. That expectation will not end well.

How Do You Find A Bookkeeper?
Recommendations from business colleagues or networking groups can be a good source. Always Spring Tax Services also works with many Bookkeepers in Colorado Springs and Pueblo and can therefore recommend a Bookkeeper based on both your business and your budget.