By
Jyoti Tejpal
QuickFile for small & medium business to manage Bookkeeping Tax Management & Savings. Simple intuitive cloud based accounting software for UK freelancers & SMEs
TRAXIT helps serve small businesses of CPAs, Accountants, EAs, Bookkeepers, Tax Preparers as easy practice management tool to manage track assign & report
The custom-made flexible web-based Accounting & Inventory App solving every operational requirement & integrating 3rd party software. Easily facilitates change
Accounting software manages and helps automation of a business organization with its financial transactions and functions with subjects like accounts payable, accounts receivable, payroll, billing, and general ledger. In a bigger context, integrated applications of accounting programs offer a real-time and considerable accumulation of data and analysis thereof, for getting the organization’s financial status which includes cash in-flow and out-flow with savings and expense management. Sometimes it is referred to as bookkeeping software.
Cost savings: Although it has been a general practice for a long time to outsource accounting for traditionally managing a small business. But if we look deeper, it increases a financial burden on the business organization as operational expenses increase to run the market in this way. Accounting software offers to help small businesses by accommodating in-house accounting functions, thereby decreasing the total financial liability for the year.
Improved process efficiency: Accounting needs paperwork and manual data entry on a day-to-day basis. It is considered to be time-consuming, prone to errors and lot more money intensive. Digitizing of financial paperwork with the help of accounting programs make small businesses decrease their time and capital expenses to a specific limit. In this way, the process of financial transactions such as expense management accounts payable and accounts receivable, etc. become more money worthy. On top of it, accounting software makes it possible to ensure that no error in calculations or records creeps in the accounting system.
Easier tax compliance: As the management of taxes in any business involves a lot of paperwork and documentation, small businesses are required to ensure that their tax forms are submitted to the offices on time to avoid any undue penalties because of delays and errors in filings. Accounting software takes the information present in the system as summary to give the financial status accurately and correctly. In this process, the filing of taxes become more comfortable and free from errors, whatsoever.
Accounts payable (AP): Helps automation of invoice capture, approval management, and authorization processes. The information of transaction taken place thru the system in the business is reflected in the accounts payable and general ledgers.
Accounts receivable (AR): Tracks all the customer credits information related to payments and purchases. The following information is automatically reflected on the general ledger.
Bank reconciliation: Matches “credits” and “debits” on its own, in an account to help accountants or clerks to spot and correct discrepancies or any missing entries in a record.
Financial reporting: Data is stored and converted into a graphical representation to understand better the status of the accounting systems of the businesses. These reports include sales reports, AP/AR, and cash flow analysis.
General ledger: Consolidates all the accounts payable and accounts receivable information in a tabular form for easy understanding. It summarizes the details like assets, equity, expense, and revenue data for each account attached to the business.
Billing and invoicing: Creates invoices of customer records, prints and sends them to the respective customers, files and sends a reminder, if needed, with the information in the accounting system.
Expense tracking: Records the total expenses incurred in the business to better understand the financial status. Users are allowed to submit the costs by uploading bills from a mobile app for their convenience.
Project accounting: Every business house may be dealing with a lot of clients and every deal is to be looked into, and then the accounting software comes handy as it tracks different accounting attributes for a client-facing project, such as incurred costs, expenses, billable hours, and client payments.
Mostly every product available in the market are priced quoted as “per user, per month” basis, and can be broken down into three pricing tiers based on their starting price, which is generally mentioned on their respective sites.
An enterprise, or premium product, which is priced higher, may include more enhanced and additional features such as multi-currency support, bill management, sales quotes, purchase order management, and recurring invoices.
Data security: An accounting system is a very intimate system for a business as it deals with and handles sensitive client and financial information, which makes them a target for hackers. This is the reason why security becomes prime concern while selecting accounting software for the business house. Small business should ensure that solution adheres to the necessary security standards, such as Extended Validation (EV) SSL and 256-bit Encryption. Otherwise, the product is susceptible to hackers.
Third-party integrations: Accounting software cannot work in isolation with closed corners. It has to be up-and-about and requires an ecosystem of similar business applications. Integration with customer relationship management (CRM) software automatically is a must. Users should evaluate the integration capabilities of the software before buying any accounting software.
Small businesses have to be on the continuous path of automation along with other companies to remain in the race.
In an attempt to decrease paperwork and errors, small businesses have to look for newer ways to automate accounting functions of their workplace. The latest technology trend and development in this area is OCR called optical character recognition technology. This technology helps users to scan financial documents and store the content in a digital format for future reference. As advancements in artificial intelligence have been improving with the increased efficiency and accuracy of OCR, the adoption of technology can be expected to increase in future.
Small businesses need a visual representation of financial reports to understand the status better. So it is a vital criterion to look into while opting or shortlisting any accounting system. This also helps in increase of substantial visualization capabilities of the business directors and other stakeholders.
