People ask us all the time about bookkeeping and accounting.  The problem is, they interchange the words as if they are the same thing.  In fact, they are not.  Bookkeeping is one facet of accounting.  Today we thought we would go through the differences between bookkeeping and accounting, and how they complement each other.

Bookkeeping, by definition, is quite literally the work or skill of keeping account books or systematic records of money transactions.*  A bookkeeper is in charge of managing all of the financial records of a company, whether that be manual bookkeeping or through a software program such as Quickbooks.  They must input all of the financial information for that company, including but not limited to: sales receipts, bills, payments, payroll, and income.  Dependant on the amount of financial information coming through the company's doors, the bookkeeper can be working monthly, weekly, even daily on the records.

The most important part of the bookkeeper's job is to stay on top of the information and make sure it is all inputted correctly.  The last thing any company wants to have is someone working on their financial records who does not know or understand what they are doing.  Unfortunately, this has been the reality of quite a few businesses, and many have gone under on the account of bad bookkeeping.

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Here at Let's Learn Bookkeeping, we like to think that a person can go out into the world (whether as a bookkeeper or not!) and make a living without having to answer to faceless corporations as an employer.

A fellow student of our Quickbooks class, Paul Turner, owner of Laptop Repair in Burbank, feels the same way.  Below are some of Paul's thoughts about the opportunity that awaits so many unemployed people in our society today, one that should be seen as a golden opportunity:

"Here's the deal...with the economy in the crazy state it's in, there is big opportunity for people to work for themselves.  There is a huge amount of talent being let go from large forces and they need to start making a living.  They have mortgages, bills, and families, like everyone else.

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Have you ever asked someone what are the most important things to know when starting your own business?  What answers did they give you?  "You need to know what you want to do, and who you want to deal with."  "Appearance is everything."  Sound familiar?  What about, "Know your finances and how to take care of them."  It's funny how wise these statements are, and how many people do not heed them.

Today, with computers taking over every day tasks, many people hide behind them doing their business like paying bills, marketing to strangers, and even handle their finances through programs like Quickbooks.  Here is a question: how many business owners understand the numbers they just inputted into Quickbooks?  Sure, they may understand income and expenses, which is important to every business.  What about their assets?  Liabilites?  Equity?  Do they understand the importance behind these categories?  I hope so.  As a business owner, they should understand these five areas of finance that no business can escape from.  Their livelihood depends on it!

Bookkeeping is where one learns these five areas of business finance.  There is no excuse for a business owner not to know bookkeeping at some level.  Can you imagine if you, as a business owner, did not understand how your equity is determined?  Could you, as a business owner, feel good about yourself if you did not understand the difference between a Profit & Loss statement vs a Balance Sheet?  Could you even dare run a business if you did not know the difference between a debit and credit?

How many businesses have failed as a result of poor bookkeeping?  It is CRITICAL that every business owner have just, at the very least, some knowledge in bookkeeping for the sake of their business and being smart financial decisionmakers.  It is amazing what a little bit of knowledge can do for you and your business in the long run.

Let's Learn Bookkeeping has a new addition to the family, its name: Quickbooks.  A new class that will teach students working knowledge of the 2009 edition of Quickbooks.  It's 3 weeks long, 18 hours of computer practice in a live class room!  Come learn one of the business world's most widely used programs and make yourself more marketable!!!!

The next course begins December 1, 2009!!