Those unfamiliar with accounting and financing wouldn’t know the difference between a bookkeeper and a professional accounting firm. While both these professions look after your finances, they have big differences in terms of the size of the team working on your company’s finances and the quality of service provided.
Among other advanced services, they prepare financial accounts, examine documents for auditing, and generate reports. A bookkeeper’s role is more administrative and includes services like data entry, ledger keeping (recording financial transactions), payroll management, and other similar tasks
The PSG Grant is only for pre-approved accounting firms
But one of the biggest advantages of working with an accounting firm is that accounting firms are eligible for the PSG Grant, a government grant for small businesses in Singapore. This government grant offers up to 70% rebates on B2B services including, social media marketing, eCommerce development and accounting services for business owners. (But make sure that the company you hire with is pre-approved for that specific service! A pre-approved social media marketing company can’t offer PSG accounting services.)
The PSG Grant is offered by the Singaporean government to encourage small businesses to transform their business processes and to use technology in their operations. The goal is to improve efficiency in accounting which will free up time to focus on other activities in the business.
You can only apply for the PSG Grant for accounting services engaged with a pre-approved accounting firm. There are also specified softwares that you must use like Xero and Quickbooks. Quickbooks and Xero are cloud accounting softwares that helps small business owners, bookkeepers and accounting firms in managing financial work.
This means that engaging a freelance bookkeeper may save you $100 a month. But you won’t be able to apply for the PSG Grant and you’ll miss out on the 70% savings that you would get otherwise through a pre-approved Xero accounting firm. You’ll have to apply for the accounting PSG Grant through a pre-approved accounting firm that has existing relationships with accounting softwares like Xero or Quickbooks. Therefore working with an accounting firm can save you a lot in costs since you’ll get reimbursed by the government through grants.
Difference between Bookkeeper and Professional Accounting Firm
Xero, a globally present cloud accounting software, does not only cater to small business owners but is even beneficial for bookkeepers and accounting firms. Xero accounting services are designed to help bookkeepers manage their workload. It allows them to maintain accurate records and collaborate with clients. This becomes especially helpful for those bookkeepers who have multiple clients. Similarly, Xero accounting firms manage accounting better than entrepreneurs without any accounting experience. Xero accounting firms allow businesses to have access to expertise that they offer from years of experience without having to learn everything from scratch
Simply said, bookkeeping is the first step in maintaining correct financial records. A bookkeeper records the daily transactions of a business. The need for a licence or Certification is typically dictated as per the rules of the place where the bookkeeper is conducting business. Apart from that, bookkeepers can opt to get certified; however, it is not mandatory.
A professional accounting firm’s work is the second step and relies on the records maintained by the bookkeeper. The accounting firm analyzes the data to prepare reviews and forecast the future financials of the business. They create reports based on the information collected by the bookkeepers. Accountants need to complete their certification and become qualified CPA (Certified professional accountants) before they can work as such.
Lastly, accountants at an accounting firm usually receive advanced training such as Xero software training. As an accountant, you constantly need to retain and upgrade your skills. This is the same in any industry. For example, social media marketers have had to expand their skills from Facebook, to Instagram, Tiktok and Youtube Shorts.
These training sessions are provided by both the company (i.e. the accounting firm) and Xero itself. This is because accounting firms can develop relationships with Xero like the Xero Gold Partner and get early training and early software updates which give Xero accounting firms early access to these features. Many Xero software training sessions aren’t offered to bookkeepers since there are requirements such as needing a CPA and experience in a large firm.
