Common Bookkeeping and Accounting Myths – Part I

Myth: Bookkeeping is Just Glorified Math: Well no. Sure you use math in accounting and bookkeeping, but so do sales people, marketers, software developers, bakers, hotel managers, and on and on and on. Basically any one that has a job uses math – even if it is just for figuring out how much they are owed in their paycheck at the end of every week. Bookkeeping is about tracking assets, liabilities, income, expenses, etc. A large part of bookkeeping however is about research and the pulling together of diverse financial information and turning it into a cohesive, understandable and concise story about the health and wellbeing of your business. It is somewhat akin to putting together a very large puzzle, with pieces that do not necessarily appear to “fit together”. And once the accountant has compiled all of that financial data, it is then used to tell the owner of a business, the board, the shareholders, the bank, managers, and investors the status of the business and what they can expect moving forward.

Myth: A Tax Preparer is the Same Thing as an Accountant: This couldn’t be further from the truth. According to Wikipedia the definition of an accountant is, “…a practitioner of accountancy or accounting, which is the measurement, disclosure or provision of assurance about financial information that helps managers, investors, tax authorities and others make decisions about allocating resources.” However you should be aware that when you enter a major tax franchise or chain your taxes are mostly being done by a trained “tax preparer” NOT an accountant. A tax preparer does not have to hold the educational degree that an accountant does. In fact a tax preparer does not have to hold any degree at all! Also be careful when someone says they are an “accountant”. Quite often bookkeepers will self-identify as an account when it truth they are not.

Myth: Bookkeepers are Usually Men: In fact the opposite is true. Today the number of female bookkeepers is either equal to, or exceeds male bookkeepers. In some countries, Canada for example, women clearly outnumber men as bookkeepers. According to Statistics Canada, “women hold approximately 80.3 percent of the country’s 17,350 bookkeeping positions. Men hold just 19.7 percent of those jobs.” As a matter of fact, many outsourced bookkeeping firms these days are dominated by women.

Myth: Accountants are Boring: Well, not that we are taking this myth personally, but… This is totally untrue. An accountant (and even a tax accountant) has to be somewhat of a people person. We are not just sitting at computers crunching numbers. We have to work with clients, clients’ customers, employees, vendors, client’s customers, etc. each and every single day. Many times we have to deal with people at difficult times in their lives. They come to us when they have financial issues that they need help in understanding and in developing a strategy to overcome those issues. Now that you think about, that really makes accountants something akin to a “financial therapist”! Okay, that may be taking it a little too far, but as you can tell, we do have a pretty good sense of humor.

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