If you are looking for a way to improve your bookkeeping, then you need to take advantage of accounting software. There are plenty of accounting programs out there, and you need to find the best accounting software for small business. This means understanding the basics of bookkeeping software. When it comes to small business accounting software, what do you need to know? Learn more about bookkeeper software below, and make sure you maximize the benefits of your accounting software program.
What Is Accounting Software?
Before we explore what your accounting program should do, it is important to define what we mean when we are discussing accounting software programs. An accounting program allows businesses to automate, streamline, and create more efficient financial management processes. You can use accounting software to make sure your books are accurate. You can reduce the time it takes to collect information, reduce the number of mistakes you make, and make it easier for you to make decisions regarding the future of your company. You can handle invoicing processes, reconciliation, accounts payable, and accounts receivable.
It is important for you to understand what an accounting program does so you can figure out how to find the best program to meet your needs. What should you expect all accounting software programs to do?
What Are the Basic Features?
There are several features that every accounting software program should be able to do. A few examples include:
Basic Math
Of course, you should expect every accounting program to be able to do basic math. This means you should be able to create a ledger, chart various accounts, create invoices, and reconcile your accounts payable and accounts receivable. You should also expect your accounting program to be able to generate basic financial reports.
Furthermore, a basic accounting program should help you track a financial loss. If your business operates in multiple states, there are different regulations you have to follow. An accounting program should help you handle that. Your accounting program should also be able to handle sales tax differences from state to state and industry to industry.
Payroll and Time
Your basic accounting software program should also be able to handle payroll and time tracking. If you have employees who need to be paid, and you need to make sure you can pay them on time. You also need to differentiate between employees and contractors, as these have different tax and withholding obligations.
The vast majority of accounting programs should also include time tracking software. If you have employees who are paid by the hour, you need to be able to track how many hours they work. That way, you can pay them accordingly. Your accounting program should be able to handle overtime, shift differential, and bonuses. If you charge clients by the hour, you should have an accounting program that can track your hours as well.
Expense Tracking
A basic accounting software program should be able to handle expense tracking. For example, your employees may turn in expense reports that need to be reimbursed. This could include business equipment, gas, airplane tickets, and hotel rooms. An accounting software program should be able to keep track of employee expenditures.
You need to make sure your accounting program has all of these features. Otherwise, there are going to be significant areas that are lacking. At the same time, there are advanced features you might be looking for in your accounting program as well.
What Else Should You Look For?
As your business grows, you may be looking for other features as well. These include:
Integrations
You should find an accounting software program that can integrate with your existing solutions. You probably have important information scattered across multiple programs. You need an accounting program that can take that information, compile it in one place, and allow you to make decisions quickly. This can help you save a significant amount of time.
Tax Codes
Your accounting program should also keep up with various tax codes. This is particularly important if you are doing business in multiple states or countries. You need to comply with all regulations to reduce your regulatory risk. Your accounting software program should help you stay in compliance.
Automation
You may want to find an accounting program that has access to automation technology. Automation technology refers to processes that can expedite a lot of the tasks that your employees do by hand. If you do not need your employees to do clerical work, they can be freed up to focus on more important areas of the business. You might even find a program that has customizable automation features.
Cloud Technology
You may want to use an accounting program that gives you access to Cloud technology. This is particularly important if you have employees who work remotely. That way, they can still access the documents they need to do their jobs by using the cloud. You should make sure a cloud accounting program has the right security features to protect confidential information from harm.
These are just a few of the advanced features you might be looking for in your accounting program.
Why Should You Use Accounting Programs?
There are several benefits that come with using an accounting program. A few examples include:
- Save Time: An accounting program can help you save a significant amount of time. Instead of having to generate reports by hand, you can ask the computer program to do this for you. That way, you can make decisions faster.
- Reduce Mistakes: Even though you may have been doing things by hand for many years, there is always a chance you can make mistakes. A computer program can help you avoid making silly mistakes that would otherwise carry through other areas of the business.
- Reduce Regulatory Risk: An accounting program can also help you reduce regulatory risk. Your software program will keep up with the latest rules and regulations in your industry. Your program might even be able to point out a few red flags that could make it more likely for you to get audited by the IRS.
- Save Money: Furthermore, an accounting program can save a significant amount of money. You may not have to pay people to do a lot of these tasks because the computer program will do them for you. In addition, if you can present an organized table to your accountant, it may not cost you as much money to do your taxes at the end of the year.
Make sure you find the right accounting program that will help you maximize these benefits.
Maximize Your Accounting Software Programs
Ultimately, this is a brief overview of accounting software. This is an area that has grown significantly during the past few years. As a result, there are plenty of options available. It can be difficult to sort through the various options and find the one that works best for you. That is why you should reach out to a professional if you have any questions or concerns about your accounting program. This is not something you have to go through on your own, so take the time to evaluate all your options and find the right program to meet your needs.
