DIFFERENCE BETWEEN BOOK KEEPING AND ACCOUNTANCY
Book-Keeping is an art and science of recording business transactions in a systematic and chronological order. It is a combination of two words: Book + Keeping. It means to keep the books of accounts to record all the financial transactions. It is concerned with identification of transactions and events, expressing them in the monetary form and then recording the transactions in the books of accounts to make it available for future reference also.
Accountancy refers to systematic knowledge of accounting concerned with the principles and techniques which are applied in accounting. It tells us how to prepare the books of accounts, how to summarize the accounting information and how to communicate it to the interested users.
ACCORDING TO KOHLER
“Accountancy refers to the entire body of theory and practice of accounting.”
Accountancy is wider in scope than book-keeping and accounting. It is a body that consists of the guiding principles and rules of book-keeping and accounting.
|BASIS OF DIFFERENCE||BOOK-KEEPING||ACCOUNTANCY|
|STAGE||It is the primary stage and provides the base for book-keeping and accounting.||It governs the process of book-keeping as it consists of principle, rules, concepts and conventions.|
|SKILLS REQUIRED||Analytical skills are not required for book-keeping.||Analytical skills are required.|
|MAIN TOOLS||Journal and ledger are main tools of Book-Keeping.||Accounting rules and principles consisting of concepts and conventions are main tools of accountancy.|
|SCOPE||It is narrower in scope than accountancy.||It is wider in scope than book-keeping and accounting.|
|LEVEL OF WORK||Book- keeping involves clerical work.||This requires high level of knowledge and understanding and thus a high level function.|
|PRINCPLES OF ACCOUNTANCY||It depends on the principles of accountancy and follows it while maintaining record of financial transactions.||It is a body that consists principles and provides the rules|