As a small business owner or aspiring entrepreneur, investing in the right tools can mean the difference between growth and stagnation. Maybe you’ve considered investing in accounting software in the past or just started researching your options, but you’re still not sure why you should purchase it.
Small scale businesses can be easily managed with spreadsheets but it is impossible to rely on them throughout your business life. Some prominent signs which indicate that now you need to switch to accounting software are mentioned as follows:
Your business is growing
Growth is an important objective for any organization, particularly for a small or new business. When a business outpaces its size and scale, it loses focus on essential functions. Spreadsheets are good when starting out. However, as business operations continue, things can easily get out of hand. The best accounting software streamlines your company’s operations. Not only can you keep on top of the cash flow, but also prepare for the next tax year in advance. Simple tasks, like cash flow projections, become tedious and time-consuming when you have too much on your plate. Accounting software frees up time that you can use to make sure your company remains successful.
You want quicker access to information
Increasingly large amounts of data are generated in the business. The ability to manage torrents of data is paramount for today’s companies. When you have lots of data, it shouldn’t be in a spreadsheet. Accounting software is better suited to handle and process bulk data. Decision-making becomes easier as you’re able to evaluate the financial position of your organization quite quickly and access the information right away. Easy access to reports and dashboards means you can easily create strategies for future growth.
Manual work is taking up more of your time
Using spreadsheets instead of accounting software can cost a fortune as you’re bound to make mistakes from time to time, resulting in time wasted fixing unnecessary errors. It’s best to avoid such issues, as they can become serious concerns. Automation reduced the error count to almost zero. Accounting software gives you your time back, so you can focus on creative endeavours and come up with new ideas for your business.
Here are some aspects to keep in mind when picking out accounting software:
- Ease of Use
Having real-time access to your data supports smart business decisions and better ensures a healthy cash flow. A few go-to features to be aware of include:
- Dashboard — Capture and organize receipts, purchase orders, invoices, tracking income and expenses, bank reconciliation, financial statements and balance sheets, time tracking, accounts payable, and receivables.
- Settings and Options — User roles, permissions that allow you to control what users can see and do.
- Record creation — Product and service records, inventory, purchasing information, product and service description.
- Chart of accounts — An index of all your financial accounts broken down into subcategories can be complex. Setting up the chart of accounts is simplified with accounting software. Most software comes complete with standard accounts and the ability to create your own. It will also allow quick categorization, edits, removal of accounts, and account number additions if required.
- Pricing that fits your budget
How many people will be using the accounting software? Some apps can be set up for multiple users, while others cannot. Get a quote/estimate for unlimited users. It’s worth asking. Also, if you don’t want to commit too long to a software solution, a monthly subscription plan is best. However, if you choose an annual subscription plan, you’ll get a significant discount.
- Reporting that meets your needs
Some of the most desired features of accounting software are financial report management, invoice and transaction management, foreign exchange gain and loss calculations, cash flow forecasting, and asset depreciation management. Decide what you want your accounting software to do.
Establishing a business and promoting its growth is a challenging task that needs helping tools in the form of different software and applications. The finance department especially needs efficient accounting softwares to expand the business. You can handle your financial records with spreadsheets for small-scale businesses but cannot always rely on them and this is why it so important to go for accounting software.
There is several accounting software out there, you just have to pick the right one. Take into account your needs and accounting skills when searching for software that can serve the need of your enterprise. You might want to consider a specialized tool, which is designed to help businesses in your niche. For example, there are applications for retailers and restaurants. With cloud computing becoming more prominent in the business landscape, it’s a good idea to look at cloud applications.