A common misconception is that hiring a CPA eliminates the need for a bookkeeper. In reality, many businesses use both. The bookkeeper maintains accurate financial records throughout the year, while the CPA or tax professional uses those records for tax preparation, tax planning and other higher-level accounting work.

The two roles can complement each other rather than compete with each other.

What Does a Bookkeeper Do?

A bookkeeper handles the recurring financial recordkeeping that keeps the company’s books current. Depending on the business, that may include transaction review and categorization, bank and credit-card reconciliations, financial reporting, payroll support, accounts payable or receivable support, and maintaining accurate records in QuickBooks or another bookkeeping platform.

That work happens throughout the year—not just when a tax return is due.

What Does a CPA Do?

A CPA may provide tax preparation, tax planning, financial analysis, advisory work, attest services and other accounting services depending on the firm and engagement. Some CPA firms also provide bookkeeping, while others prefer clients to arrive with accurate, reconciled books.

The important distinction is that routine monthly bookkeeping and tax/accounting work are not automatically the same service.

Why Not Just Have the CPA Do Everything?

Sometimes that makes sense, particularly if the CPA firm offers bookkeeping at a price and service level that works for the business. But many owners prefer to separate recurring bookkeeping from tax work.

Routine bookkeeping is ongoing and transaction-heavy. A CPA’s time may be better used for tax, accounting and advisory matters rather than routine monthly reconciliation and categorization. The right arrangement depends on the services your CPA offers and what your business needs.

Good Bookkeeping Can Make Tax Time Easier

If the books are not reconciled or contain significant errors, someone has to correct them before reliable tax or financial work can be completed. That can create extra work, delays and frustration at year-end.

Maintaining the books throughout the year means your tax professional can receive cleaner records rather than discovering months of bookkeeping problems when a deadline is approaching.

What If My CPA Says My Books Need Cleanup?

That is a common point at which businesses come to a bookkeeping company. You do not have to correct the books yourself before handing them over.

Capacity provides bookkeeping cleanup and catch-up services to correct existing records and bring the bookkeeping current. We can then maintain the books going forward so your CPA receives organized information when it is needed.

Can My Bookkeeper Work With My CPA?

Yes. A good bookkeeping relationship should make communication with your tax professional easier, not harder. Your bookkeeper can maintain the underlying records and help provide the reports or bookkeeping information your CPA needs.

You keep your existing CPA relationship while improving the quality and consistency of the monthly bookkeeping.

When Does a Business Need Both?

• Your CPA prepares your taxes but does not maintain your books each month.
• Your bookkeeping regularly falls behind between tax seasons.
• Your CPA spends time correcting bookkeeping before tax work can begin.
• You want current financial reports during the year, not just at tax time.
• Your business has grown beyond what you comfortably manage yourself.
• You need someone you can contact about routine bookkeeping questions.

How Much Does a Bookkeeper Cost?

The workload varies dramatically from one business to another. Transaction volume is one of the biggest factors, along with the number of accounts and bookkeeping complexity.

Capacity uses fixed monthly pricing based on the work the business actually requires. For more detail, see How Much Do Bookkeeping Services Cost for a Small Business?