Today, businesses of all sizes use accounting software to keep track of their revenue and inventory, and forecast sales.
Key points to remember
- There are many different accounting software providers that offer different features at different price points.
- There are industry and sector-specific software in the market, all with their own special features geared towards specific business needs.
- Cloud accounting systems are popular due to their convenience and ease of accessibility.
What is accounting software?
Accounting software is a type of application software that records and processes accounting transactions such as:
- Accounts receivable: amounts due to clients/customers that have received products/services from your business whom have not paid yet.
- Accounts payable: amounts due to pay to vendors or suppliers when products/services have been received but not paid for.
- Journal entries: all the transactions of a business.
Consider the needs of your business
There are plenty of options for you but we’ll give you some pointers on how to choose the right accounting software for your business. The best way for you to decide which software will be the best fit, is to look at your business and how it operates. A small business (<100 employees) will have different needs to a medium sized business (100-999 employees) which will again have different needs to a large business. There are different accounting programs that cater for businesses of a variety of size and revenue, as well as software that is specifically geared towards small and medium sized businesses.
There is also specialised software for different industries and sectors such as the hospitality or manufacturing industries, for example.
Although accounting software helps greatly with accounting tasks, it is not an accountant. The person using the software must still have a basic level of financial literacy. Therefore, you may need to consider your employees’ or your own level of skill and choose an accounting software that offers more guidance and support.
Cloud accounting systems
Many accounting software providers provide cloud systems now. This means the information and software can be entered and accessed at any location with an internet connection.
There are a few benefits to using a cloud accounting software including:
- Software is maintained by the server who will upgrade and fix any issues
- Cloud applications can be accessed from any device such as a laptop, desktop, tablet or smartphone.
- The data is kept secure in an offsite data centre so you do not have to worry about records being destroyed.
- Software can be accessed anywhere with an internet connection.
There are a few business management software programs that offer inbuilt accounting software. This may be a good option if you are looking for an all-encompassing software for your business.
There is business accounting software to suit all business sizes and budgets. Most accounting software providers offer a subscription-based model with tiered pricing depending on thefeatures you need.
When deciding which accounting software to use for your business, take the cost of the software into consideration. Remember, you get what you pay for – higher price usually means more features.ou should look into finding software that does not require a locked-in contract so that you can cancel and switch software depending on the needs of your business.
Consult an accounting professional
If you are currently using an accountant, you should consult them on which accounting software is the most suitable for your business. They may prefer you use one that is compatible with the one that they use and can offer you an educated opinion on which one to choose. Some software may also allow you to invite your accountant or bookkeeper to share your books.
Accountants cannot give legal advice. If you should require any legal advice to do with the finances of your business, click here to book a FREE consultation with one of our highly experienced solicitors today or contact us at firstname.lastname@example.org or call 1300 988 954.
The above information may have been collected from relevant government websites or other sources and is subject to change. For the latest information regarding new or amended legislation or changes to government policy, please refer to state and federal government websites.