Why is accounting software important?

Helen ChanBusiness Tips, News

Seriously … why the huge buzz on accounting software?

In such busy times where time is of the essence … everything is all about being fast and seizing the right opportunity at the right time. Some might even say – “Speed is everything.”

There has been much talk about manual accounting vs automated accounting . Based on surveys that have been done, you’d be surprised to find out there are still many, especially among the SMEs who do not realize the importance of having an automated accounting information system. Thus, this prompted me to write on this topic …

What is an accounting software?

Hmmm … there are many definitions but basically, accounting software is a group of coded programs that assists and enables you to handle and manage your business’s financials related matters. Such coded programs can vary from A to Z, with some providing very simple features – eg. simple book keeping to some designed specially to manage everything that touches … finances.

So what are the benefits of using an accounting software?

Well, there ARE a significant number of beneficial reasons:

Accuracy

Yes, it manages all the math for you! You won’t have to worry about the many digits and numbers that seem to consistently float around in your head, as accounting software can help ease your headache by taking over all the calculations and thus increasing accuracy, through reducing errors. If you are an accountant, I am sure you are familiar with doing accounting manually as well – basically, all mathematical calculations are by hand and in your head. Any mistakes at the beginning of the process could create a fatal chain reaction, having a huge impact on the end results. You definitely want to avoid this, at all costs!

Coded programs, are different. They are virtually incapable of making any errors. Of course having said this, we need to also bear in mind that coded programs are also not bug-free and the matter of fact is that even accounting software is not immune to human errors (data entry/interpretation mistakes). Yet still, the many benefits still outweigh manual accounting.

Speed

As mentioned earlier on, time is of the essence. Many have lost out on deals due to the time factor. Thus, it is of great importance that speed must be addressed especially in matters of finances. It is no doubt that coded programs, that run on computers, can process figures and logic, much faster and therefore using accounting software, most definitely would allow businesses to process their finances with greater speeds, as compared to manual processing.

The crux of the matter also lies with automation. Processes and redundant tasks are automated. Digital invoices can easily be issued. Basically, all the finances in a Company become fully automated which ultimately increases the overall efficiency and effectiveness of the Company.

Cost

While there are many debates on the costs involved in engaging an accounting information system in place, we must not forget that the many benefits that result from the increased speed, effectiveness and efficiency of using an accounting software, actually DOES often run in parallel with reduced overall costs. With everything being automated, the accounting team members can achieve more in a stated time. This could potentially mean having a smaller team.

Reports

Instead of the staff churning out reports manually, as and when required, which can be very time consuming, now the accounting software is able to provide the required timely and accurate financial information reports, with just the click of a button.

Tax

I am sure you are aware that filing your business taxes and ensuring that they always meet the necessary regulations, can be a very daunting and complex process. To do so, you need to always keep track of the Company’s cash flow and all the business’s transactions, at your toes all the time. Accounting software eases this significantly, by providing some automation to the necessary processes and since all the business’s financial data are centralized in one place, the whole filing process becomes less burdensome and lighter.

So now that we have safely established that seriously … accounting software IS important … and because it is important for your business, it is also equally important for you to be careful in choosing the right software that fits your business.

What are the crucial factors to consider then?

Features

Evaluate carefully, especially with the help of the accounting team, check IF the product’s features and functionalities are what your business needs.

Overall value

The cheapest may not always be the right fit for you, so do look at the macro picture and take into consideration the software’s overall value, based on its features and functionalities.

Scalability

This is a very vital point. Businesses need to change and grow with times. Therefore, the software needs to be robust and be able to scale up accordingly as and when required.

Learning curve

Choosing a software that is user-friendly and easy to adopt is essential to the success of the system being implemented smoothly.

Integrations

The software’s ease to integrate with many 3rd party products is crucial to ensure the system’s functionality and core capabilities, can be enhanced to meet your demands better.

OR you can contact our highly experienced software consultants and they will gladly lead you in the right direction in ensuring you get what you need.

If you have any inquiries, please do not hesitate to contact us at our HOTLINE: 1300-800-828.

 

References made from and Credit given to the following:

Andy Walton – https://smallbusiness.chron.com/importance-accounting-software-71524.html

https://financesonline.com/accounting-software-useful-look-importance-businesses-organizations/