What is the Difference between Bookkeeping and Accounting?

What do you mean by Bookkeeping and Accounting?

Book-keeping and accounting are often used interchangeably but they are different from each other. Book-keeping provides the basics of accounting whereas accounting is a broader subject. Accounting includes design of accounting system, income tax work, audits, cost studies , preparation of financial statement and analysis & interpretation of these financial statements for decision making purpose.

Difference between Bookkeeping and Accounting

Book- keeping


Book-keeping makes the base for the accounting. Accounting makes the base for business decision making.
Book-keeping means recording of transactions. It is summarization of the recorded transaction.
Book-keeping is mainly clerical in nature and usually done by junior employees of the accounts section. The work of accounting requires conceptual knowledge and analytical skill.
Book-keeping is done according to accounting concepts and conventions. The methods and procedure of analysis and interpretation of financial statements vary from organization to organization.
You can not define the financial position of any business from the book-keeping records. You could define the financial position of any business from the accounting records.
Financial statements are not the part of book-keeping. Financial statements are prepared from the book-keeping records for the accounting purpose.