Bookkeeper or Accountant What Does Your Business Actually Need
A bookkeeper and an accountant usually solve different parts of the same problem. A bookkeeper keeps the day-to-day records organized, reconciled and current. An accountant or other qualified tax professional commonly uses those records for year-end work, tax returns, assurance engagements and specialized tax advice.
Many Ontario small businesses benefit from both. The important question is not which professional is "better." It is who is responsible for each task, what information they need, and how the handoff will work.
What a bookkeeper normally handles
Bookkeeping creates the organized financial record that later work depends on. The exact scope varies by agreement, but routine work can include:
- reviewing and categorizing business transactions;
- reconciling bank, credit-card, loan and clearing accounts;
- matching receipts, invoices and other supporting documents;
- tracking missing information and unusual transactions;
- maintaining the bookkeeping file and chart of accounts;
- preparing standard bookkeeping reports; and
- assembling organized records for the business owner and year-end accountant.
The Canada Revenue Agency says business records must be organized. The records you need depend on your business, including its GST/HST and payroll responsibilities.
What an accountant or tax professional normally handles
Ask an accountant or other qualified professional about income-tax returns, specialized tax advice, and compilation, review or audit work. If a lender asks for financial statements, confirm which report it requires. Those terms describe different work; a standard bookkeeping report does not replace it.
Current reconciliations and organized documents give your accountant a clearer starting point for that work.
When bookkeeping should come first
Start with bookkeeping when the immediate problem is incomplete records, unreconciled accounts or missing receipts. Establish the last completed period and what is still outstanding before relying on the reports.
If the books are behind, cleanup may be needed before monthly work can begin. Ask for an assessment of the records before accepting a price or timeline.
When the accountant should be involved early
Involve the appropriate professional early in decisions about incorporation, buying or selling a business, tax planning or lender reporting requirements. Organized books help, but the advice needs to come from the person qualified and engaged to provide it.
The bookkeeper can organize the supporting records and record adjustments supplied by the accountant.
Why the handoff matters
A useful handoff identifies the completed period, reconciled accounts, outstanding questions and supporting records. Agree on what the accountant expects, so nobody has to rediscover information that could have been collected during the year.
Business Acumen Results maintains day-to-day bookkeeping and assembles organized information for the client's accountant or other qualified professional. Year-end adjustments supplied by the accountant can then be recorded so the bookkeeping file remains aligned for the next reporting period.
When year end starts with a question about a loan
Maybe this has happened to you. Your accountant asks why a loan balance does not agree with the lender statement. You have been making the payments and assumed the bank feed handled the bookkeeping. Consider an owner whose monthly loan payments were all assigned to one expense category. The records need to distinguish the relevant components of the payment and reconcile the remaining balance.
The practical next step is to gather the loan agreement and statements, ask the bookkeeper to investigate the recorded activity and identify any question that belongs with the accountant. BAR can organize that evidence and record adjustments supplied by the accountant. The owner gets a clearer handoff without asking either professional to work beyond their role.
What about GST HST and payroll
GST/HST and payroll combine routine administration with questions that may need specialist advice. BAR can track and reconcile routine GST/HST information and assist with routine filing within the agreed engagement. Payroll processing and administration are separately scoped. The client reviews and authorizes filings and payments, while unusual tax or employment questions go to the appropriate professional.
Questions to ask before hiring either professional
- Which tasks are included, and which are specifically outside the engagement?
- Who prepares and who authorizes GST/HST filings, payroll, payments and adjustments?
- How frequently will accounts be reconciled and reports produced?
- How are receipts, statements and missing-information questions handled?
- Who communicates with the year-end accountant, and what will be provided?
- How will unresolved issues and deadlines be documented?
- What happens if the current records need cleanup before ongoing work can begin?
How Business Acumen works with your accountant
At BAR, we maintain day-to-day bookkeeping, prepare standard reports and organize the records your accountant needs. We do not prepare income-tax returns or perform compilation, review or audit engagements, legal work or specialized tax planning.
If you need organized books for the work your accountant handles next, explore our monthly bookkeeping services or book a free 15 minute call. We can discuss the current records, any backlog and the handoff your accountant needs.
We provide in-person bookkeeping in Hamilton and surrounding communities and virtual bookkeeping across Ontario.