The book-keeping, accountancy and auditing are different from each other in their meaning, scope, advantages, interest served, recording, analysis and reliability. However, the difference between these can be expressed as follows:
Book-keeping: May be defined as the act of recording financial transactions of an independent unit in suitably ruled books, whether maintained manually or electronically, kept for the purpose of each accounting cycle.
Book-keeping is concerned with maintaining a regular, correct and automatic record of day to day financial transactions of economic unit. It is a work of a more or less mechanical nature and does not require knowledge of the principles of accounting. Bookkeeping includes (i) entering the financial transaction in various books (ii) summarizing the same in the relevant ledger accounts, (iii) casting such accounts and striking the balance, (iv) proving the arithmetical accuracy of ledger, and (v) providing financial data for the preparation of financial statements.
Auditing: May be defined as the analytical and critical examination of the books of accounts checking and verification of evidence in support of entries appearing in the books of accounts, and ascertaining the authenticity of the assertions made in the financial statements. Auditing is a systematic examination of the financial statements, to determine how far they have adhered to the management policies and generally acceptable accounting principles.
Auditing is quite different from book-keeping and accountancy and is not concerned with the writing up of books of accounts or the preparation of financial statements.
Concisely: Bookkeeping, as the name implies, is the writing up and keeping of books of accounts (both subsidiary and main).
Accountancy, refers to the preparation of periodical financial statements for presentation to owners and others. Auditing, is the examination, verification, valuation and giving professional opinion on the books, records and financial statements prepared by the enterprise.
Concluding:
(a) Bookkeeping begins simultaneously with the introduction of capital, whether in cash or in kind of partly in each form and comes to an end with the return of capital of the owner;
(b) Accountancy begins where bookkeeping ends.
(c) Auditing has nothing to do with bookkeeping and accountancy but is a critical and investigative examination of financial data collected, classified and summarized according to proper and generally accepted principles.
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