Accounting Software for Small Business

Jude

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Bookkeeping serviceseBetterbooks

When a company wishes to fully or partially take over the management of its accounting internally, it can use accounting software. The latter allows companies to save significant time. Indeed, it has many uses such as: keeping management accounts , tracking expenses, etc.

However, faced with the multitude of existing software, it can be complicated for the entrepreneur to make the most appropriate choice for his business.

Are you an entrepreneur, incorporated self-employed worker or responsible for the accounting of an SME? You should not neglect to choose your accounting software carefully, which must become an ally in the productivity and organization of your business.

What is accounting software?

Before trying to understand why companies use accounting software, it is first necessary to define it.

The definition

Accounting software is defined as a computer program capable of automating a company's accounting process by performing operations such as:

  • billing
  • The establishment of quotes
  • Expense tracking
  • Management of accounting documents, orders or stocks
  • Staff management

Why have accounting software?

All companies are required to keep more or less complex accounts depending on their tax system. However, the use of accounting software can considerably facilitate the related procedures and has many advantages for the company:

  • Securing the accounting process: the accounting entries, as well as the reports in the accounting books, are carried out automatically by the software, making it possible to signal potential discrepancies
  • Time-saving: the accountant no longer has to enter all the accounting documents and can then concentrate on the entries related to the work of closing the accounting year
  • The realization of savings: in particular concerning the fees of the chartered accountant
  • Facilitate decision-making: the manager of the company can have an overview of the operation of the company in real-time, in particular thanks to a dashboard

What are the functions of the accounting software?

The accounting software has various functions that should be presented.

Bookkeeping

The most obvious function of accounting software is to keep the books of the business. Thus, it makes it possible to become aware of the financial health of the company, in particular thanks to the General ledger of accounts, the balance sheet, the inventory book, the legal appendix or the income statement. If you've been looking for online bookkeeping services that will take care of your business and make it easier to manage, then look no further, there are many accounting firms that can handle entire business finances.

Some companies are required to draw up these documents for each financial year, they must also file annual accounts with the registry of the commercial court. This obligation depends on the tax regime to which the company is subject.

The management software makes it possible to generate accounting entries automatically and thus save time for the accountant. Indeed, the accounting firm will limit itself to revising the accounting entry as well as the annual accounts carried out by the software.

Management of quotes and invoices

Most accounting software has an invoicing module. It draws up quotes and invoices and reduces the risk of data entry errors by recording them directly in an automated way within the accounting system.

Expense tracking

Some accounting software may have the functionality of tracking company expenses. Thus, they are responsible for recording the company's accounting documents (invoices, financial flows) and analyzing the company's expenses and products, allowing the entrepreneur to be informed in real time of the balance of the accounts of the society.

How to choose your accounting software?

There is a multitude of accounting software, however it is up to the entrepreneur to choose one that is adapted to his needs as well as those of the company. To do this, it is important to ask yourself the following questions.

What are the important parameters to consider?

It is important to choose software adapted to your type of business and the activity carried out. To do this, you should consider the following points:

  • Does the activity require custom software or is a standard program sufficient?
  • What budget does the company have?
  • Is it necessary to export the accounts to the company's accountant?
  • What tax obligations does the company fall under? Ex: should the tool be used to prepare VAT declarations?
  • How many users will be required to handle accounting software?

What is the size of the company?

The size of the company also plays an important role in the choice of accounting software.

Very small businesses (TPE) will be able to make do with standard software to keep their company's accounts, the majority of their accounting records corresponding to current operations. They can also be assisted by a chartered accountant to draw up their financial statements.

As for small and medium-sized enterprises (SMEs), it is necessary to take into account other tasks to be performed such as: VAT declarations or sending the tax return. In this case, standard accounting software may also suffice, provided that the necessary functions are integrated .

Finally, when it comes to large companies , they generally require a more complex accounting process. As such, they often need to use a tailor-made solution to better manage their accounts.

Jude has a master's degree in Finance. Currently, he is working as a Financial Advisor for a bookkeeping-based startup ebetterbooks. He is also a contributor to other renowned accounting blogs.

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My name is Jude. The Quickbooks development team was where I previously worked. Now I help people with Quickbooks errors. I am also an expert in Quickbooks error solutions.

Wilmington, DE
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