You are probably reading this article because you heard from some peer or competitor, vendor or client, or maybe even at a conference, about how accounting software is this new magical tool that can help streamline businesses? Or maybe you heard about a company that experienced better profitability because of accounting software. Maybe some of your team members have put forth a request for it? It is even possible that you were researching how to run a happier team, and this article popped up because accounting software reduces stress by minimising the data entry burden. Accounting software make the lives of business owners easier.
Accounting software is the answer to a whole host of business management issues. Although it might seem like “an accounting thing”, accounting software can streamline the whole business because company capital affects the whole business. Every department and team member that spends or earns money for the company and has to either make decisions on company capital or report on spending/earning it can benefit from accounting software. If you are looking to select accounting software for your company, you need to choose from one of the following types of accounting software.
No matter which of the three types below you choose, all accounting software should offer you a handful of basics. These include receipt scanning that allows the user of the software to simply snap a bill, receipt, or invoice and upload it to the system, following which the system churns out a ready data entry. The digital text can be copied and pasted to other files or locations and it can be edited or corrected if need be. A copy of the source document is also maintained for later reference. Automatic sorting of entries is also a given in all types of accounting software.
Other factors that should be given by default in any type of accounting software are upfront or pay-as-you-go payment options; free trial, free demo, and scalable users. You should be able to add users or expand your package as your team expands.
All software types should be able to collect and report data in GBP and should be able to handle and calculate UK taxes and taxation.
Accounting software to capture, upload, and track your finances
This is the most basic accounting software one can have. This type of software comes with the receipt scanning tool. In addition, with some of the premier types of accounting software for managing finances, you will be able to connect your account with PayPal, Amazon, and more than 1,400 suppliers, so that you and your team have to fret over missing paperwork, never again.
All your information is stored in one place and you will be able to search for specific entries by keyword. This kind of accounting software is typically able to also categorise your financial data by tax, supplier, and region. Most software will also throw in a free partner app that lets you use your smartphone to get a real-time view of your business finances via a dashboard.
The software also helps you eliminate duplicate entries by merging or deleting duplicates. The system also flags up errors and anomalies in the data.
You can check out Dext as it is one of the best accounting software.
Accounting software for sales invoicing management
The right type of software for sales invoicing management can fetch itemised transactions from all your business’ retailers, marketplaces, e-commerce platforms, point of sale systems, payment providers, and so on. The accounting software you choose should not only integrate with your existing marketplaces and e-commerce platforms but should display a wide level of integrations to support future business moves and expansion.
A very basic gamut of integrations should include Xero, Quickbooks, eBay, Amazon Seller Central, Walmart Marketplace, Etsy, and Paypal. Don’t settle for anything less than this.
Accounting software that offers precision tools for bookkeepers and accountants
This type of software can pull data from linked business bank accounts, or from PDFs of bank statements at the very least (thanks to the receipt scanner that is a basic requirement in any accounting software). Additionally, software for bookkeepers and accountants will track changes and offer cleanup tools that back-check data and spot discrepancies and anomalies in your data. Additionally, because your team will be working on the software, you will be able to track team workflows and the progress of jobs.
Best of all, this type of accounting software has a feature (offered by some brands) that lets you check the state of a new client’s books before you onboard them and therefore price accordingly, or alternatively lets you, onboard clients, faster if you already glance over a potential client’s books before offering pricing options.
Click here for the best accounting software in this category.
So far we have explored the types of accounting software, their benefits & how to choose correctly.
We also promised to discuss the cons of the various types of accounting software: the only downside that one might experience when upgrading to accounting software is formatting data in such a way that it fits into the forms of the software when you migrate.
Additionally, businesses might want to consider the timing of migrating to the new software to a less busy end-of-quarter than the financial year ending to allow users sufficient breathing space to get used to a new system. Most of the best accounting software brands will offer you a free demo – use it to alleviate any anxiety over the ease of operating the software. Accounting software are typically intuitive and easy to use, but you must also consider that people might be resistant to change – make the transition easy.
One big con/ disadvantage related to accounting software is linked strictly to free accounting software. Most accounting software are affordable, starting at GBP 20 for 5 users and 300 monthly scans for a popular brand like Dext. Avoid the free variety, however, because you will normally face the disadvantage of truly useful tools being placed beyond a paywall.