ArtsAutosBooksBusinessEducationEntertainmentFamilyFashionFoodGamesGenderHealthHolidaysHomeHubPagesPersonal FinancePetsPoliticsReligionSportsTechnologyTravel

Book-keeping, Accounting and Accountancy

Updated on November 11, 2013

Book-keeping, Accounting and Accountancy

It is important to understand the meaning and function of the terms "Book-keeping", "Accounting" and "Accountancy". Let us look at the different terms separately and understand the meaning and function of these terms.

Accounting system has following two stages as per G A Lee. They are:

Stage 1. (Book Keeping) Stage one involves the collection of invoices and receipts, making vouchers and entering the financial information in the books of account as per the rules and regulations. All such transactions or events which affect the financial state of the organization comes under this stage.

Stage 2.(Accounting) This stage involves, the analysis and summarization of recorded financial events or transactions and its presentation of the same to the interested parties as well as its interpretation as an aid to decision making by the interested parties.

Stage one, i.e. making of routine records in the prescribed form as per the rules and recording them in the books of account is called Book-keeping and stage 2 i.e. summarization of record from time to time and making it available in the form of profit and loss account and balance sheet is called Accounting. Accounting starts where book keeping ends.

Book-keeping involves the following steps:

  1. Identifying the transactions and events to be recorded,
  2. Measuring them in terms of money
  3. Recording them in the books of prime entry
  4. Posting them into ledger.

Accounting involves the following steps.

  1. Summarizing the recorded data
  2. Interpreting the financial results
  3. Communicating them to the interested parties.

In practice, accountants also review and direct the work of book-keepers and therefore the term accounting is generally used in a broader sense covering all accounting activities. Hence, Book-keeping is regarded as a part of accounting.

The term "Accountancy" represent to a systematized knowledge of accounting. It is regarded as an academic subject like chemistry, economic, statistics etc. It teaches how to do the accounting and why to do the accounting and other aspects of the art of accounting.

Accounting refers to the act of accounting or the actual process of accounting whereas accountancy explains how to do the accounting.

Accountancy explains how and why to prepare the books of account and how to summarize the accounting information and how to communicate it to the interested parties.

Accountancy is a science, a body of systematized knowledge whereas Accounting is the art of putting these knowledge into practice.

However, in general, Accounting and Accountancy are used for the same meaning. But accounting is becoming more popular now a days.


    0 of 8192 characters used
    Post Comment

    • profile image

      cooper cook 

      5 years ago

      I never knew that book-keeping and accounting were in the same category. Because whenever I heard of the term book-keeping I always just assumed that it was someone who owned or worked in a bookstore or library. Not that book-keepers were actually accountants, well now I can say that I know.

    • cheetah786 profile image


      6 years ago

      really informative tutorial. it can build base for book keeping for new stdents.

    • Iamsam profile imageAUTHOR


      6 years ago

      Thanks yeagerinvestments for stoping by and commenting.

      Thanks a lot.

    • yeagerinvestments profile image

      Shawn Yeager 

      6 years ago from Wisconsin

      Good information for anyone to know, especially business owners.


    This website uses cookies

    As a user in the EEA, your approval is needed on a few things. To provide a better website experience, uses cookies (and other similar technologies) and may collect, process, and share personal data. Please choose which areas of our service you consent to our doing so.

    For more information on managing or withdrawing consents and how we handle data, visit our Privacy Policy at:

    Show Details
    HubPages Device IDThis is used to identify particular browsers or devices when the access the service, and is used for security reasons.
    LoginThis is necessary to sign in to the HubPages Service.
    Google RecaptchaThis is used to prevent bots and spam. (Privacy Policy)
    AkismetThis is used to detect comment spam. (Privacy Policy)
    HubPages Google AnalyticsThis is used to provide data on traffic to our website, all personally identifyable data is anonymized. (Privacy Policy)
    HubPages Traffic PixelThis is used to collect data on traffic to articles and other pages on our site. Unless you are signed in to a HubPages account, all personally identifiable information is anonymized.
    Amazon Web ServicesThis is a cloud services platform that we used to host our service. (Privacy Policy)
    CloudflareThis is a cloud CDN service that we use to efficiently deliver files required for our service to operate such as javascript, cascading style sheets, images, and videos. (Privacy Policy)
    Google Hosted LibrariesJavascript software libraries such as jQuery are loaded at endpoints on the or domains, for performance and efficiency reasons. (Privacy Policy)
    Google Custom SearchThis is feature allows you to search the site. (Privacy Policy)
    Google MapsSome articles have Google Maps embedded in them. (Privacy Policy)
    Google ChartsThis is used to display charts and graphs on articles and the author center. (Privacy Policy)
    Google AdSense Host APIThis service allows you to sign up for or associate a Google AdSense account with HubPages, so that you can earn money from ads on your articles. No data is shared unless you engage with this feature. (Privacy Policy)
    Google YouTubeSome articles have YouTube videos embedded in them. (Privacy Policy)
    VimeoSome articles have Vimeo videos embedded in them. (Privacy Policy)
    PaypalThis is used for a registered author who enrolls in the HubPages Earnings program and requests to be paid via PayPal. No data is shared with Paypal unless you engage with this feature. (Privacy Policy)
    Facebook LoginYou can use this to streamline signing up for, or signing in to your Hubpages account. No data is shared with Facebook unless you engage with this feature. (Privacy Policy)
    MavenThis supports the Maven widget and search functionality. (Privacy Policy)
    Google AdSenseThis is an ad network. (Privacy Policy)
    Google DoubleClickGoogle provides ad serving technology and runs an ad network. (Privacy Policy)
    Index ExchangeThis is an ad network. (Privacy Policy)
    SovrnThis is an ad network. (Privacy Policy)
    Facebook AdsThis is an ad network. (Privacy Policy)
    Amazon Unified Ad MarketplaceThis is an ad network. (Privacy Policy)
    AppNexusThis is an ad network. (Privacy Policy)
    OpenxThis is an ad network. (Privacy Policy)
    Rubicon ProjectThis is an ad network. (Privacy Policy)
    TripleLiftThis is an ad network. (Privacy Policy)
    Say MediaWe partner with Say Media to deliver ad campaigns on our sites. (Privacy Policy)
    Remarketing PixelsWe may use remarketing pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to advertise the HubPages Service to people that have visited our sites.
    Conversion Tracking PixelsWe may use conversion tracking pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to identify when an advertisement has successfully resulted in the desired action, such as signing up for the HubPages Service or publishing an article on the HubPages Service.
    Author Google AnalyticsThis is used to provide traffic data and reports to the authors of articles on the HubPages Service. (Privacy Policy)
    ComscoreComScore is a media measurement and analytics company providing marketing data and analytics to enterprises, media and advertising agencies, and publishers. Non-consent will result in ComScore only processing obfuscated personal data. (Privacy Policy)
    Amazon Tracking PixelSome articles display amazon products as part of the Amazon Affiliate program, this pixel provides traffic statistics for those products (Privacy Policy)