Accountant vs Bookkeeper Which One Do You Really Need for Your Business

“Do I really need an accountant, or will a bookkeeper be enough?”

The honest answer is: it depends on where your business is at — and what kind of support you actually need.

Let’s break it down in simple terms, without the jargon.

What Does a Bookkeeper Do?

Bookkeepers manage the day-to-day financial records of a business. Their main job is to keep accurate and organised records of all financial transactions. This includes:

• Processing your bills

• Help you with invoicing, maybe even do it all for you

• Tracking expenses and income

• Managing receivables

• Reconciling bank statements

• Maintaining xero (or whatever software you are using)

• processing payroll

• GST returns

• They might be a permanent employee, or a contractor

  
  

Bookkeepers are fantastic at keeping things accurate, tidy, and up to date. If your main goal is knowing what you are owed, what you owe, and staying organised, a bookkeeper can be a great fit.

When Do You Need a Bookkeeper

If your business is small you can probably do this yourself. If it gets really big, with lots of bills to processes, that's where hiring a bookkeeper is gold.

What Does an Accountant Do?

An accountant looks at the bigger picture — not just what happened, but what it means and what you should do next:

As well as your year end financial statements and tax returns, Accountants typically handle

• GST/FBT returns

• Tax planning and minimisation strategies

• IRD compliance and advice

• Business structure advice (including exit plans for when you retire, or have had enough)

• Cashflow forecasting and budgeting

• Management report

• Business advisory and growth planning

• Advising on financial strategy and compliance

• Ensuring you are following tax law

• Usually have a network of other business specialists they can bring in

  
  

In short, accountants help you make better decisions, reduce risk, and avoid costly mistakes — not just report the numbers.

The key difference (in plain English)

Think of it like this:

• A bookkeeper tells you what happened

• An accountant tells you what it means and what to do about it

Both roles are valuable — they just serve different purposes.

How to Decide Which One You Need

When a bookkeeper is usually enough

You might only need a bookkeeper if:

• Your business is small and straightforward

• You’re a sole trader with low complexity

• You’re confident handling tax decisions yourself

• You mainly want help with invoicing, and payroll

• You’re just starting out and watching costs carefully

Many businesses start here — and that’s totally fine.

When you really need an accountant

An accountant becomes important when:

• Your business is growing

• The numbers are already getting bigger and you'd rather an accountant gave your GST returns a once over before filing

• You’re unsure how much tax you should be setting aside

• You’re paying provisional tax (or about to)

• You want to reduce tax legally, not accidentally overpay

• You’re considering changing your business structure

• You want to improve cashflow or profitability

• You’re worried about IRD compliance or audits

• You want advice, not just data

If you’ve ever thought “I don’t really understand my numbers” — that’s usually the moment an accountant adds serious value.

Can You Have Both?

Of course!

This is actually a very common (and effective) setup:

• A bookkeeper handles the regular, day-to-day work

• An accountant reviews the numbers, prepares year-end accounts, and provides advice (including to your bookkeeper if they have compliance questions). Usually you wouldn't deal with them day to day, but at Sprout we do deal with 80% of our clients at least monthly, if not more. To fully utilise your accountant, use them for more than just annual taxes.

  
  

The two roles complement each other. When they work together well, you get:

• Clean, accurate data

• Better tax outcomes

• Clear financial direction

  
  

Many accountants (including Sprout) also offer monthly accounting and advisory packages that cover both functions — which can be more cost-effective than hiring separately.

What about cost?

This is a big concern for most business owners.

A bookkeeper generally costs less per hour than an accountant — but that doesn’t mean they’re cheaper overall if mistakes or missed opportunities cost you later.

A good accountant can:

• Ensure you don't overpay your tax

• Reduce the risk of penalties

• Help you price properly

• Improve cashflow

• Spot issues early

That value often far outweighs the fee.

The real question to ask yourself

Instead of asking:

“How do I spend the least?”

Ask:

“What level of support does my business actually need right now?”

If you just need things recorded → bookkeeper

If you want clarity, confidence, and strategy → accountant

If you want both → a combined approach is usually best

Still not sure? That’s normal.

Most business owners don’t sit neatly in one category. They certainly don't stay there during the life cycle of their business.

That’s why a short conversation with an accountant can be incredibly useful — even if you already have a bookkeeper. You’ll quickly find out:

• Whether you’re missing anything

• If your current setup is working

• Where you could improve

Tips for Working with Bookkeepers and Accountants

• Clearly define roles and responsibilities to avoid overlap.

• Get your business onto Xero! Both your bookkeeper and accountant are then working with the same data

• Maintain open communication to keep financial data accurate and up to date - introduce them to each other

• Regularly review financial reports to make informed decisions.

• Ensure your bookkeeper has experience with NZ GST, and perhaps look for one that is a member of a professional body (it goes without saying that your accountant should be)

  
  
  
  

Final Thoughts

If you are currently feeling a little overwhelmed managing your office then contact me for a free chat. I will listen to your problems and guide you through some solutions.