No matter if you’re only starting out as a freshman on the business stage or you’ve been running your own enterprise for a while, you can’t allow yourself to neglect your financial books. Falling behind with accounting reports, tax returns and payments will put your business at risk of being penalized by the authorities and your clients.
To prevent this outcome, it’s imperative to add a state-of-the-art accounting tool to your software toolbox. Still, this can be a tiring procedure, since the present-day market is saturated with a vast array of solutions.
We’ve been there and we know how costly choosing inadequate accounting software can be. This is exactly why we’ve collected some questions you need to ask yourself as you’re trying to choose the best accounting option for your business.
Also, we’re offering some practical suggestions for indecisive entrepreneurs.
Why do you need accounting software?
Before you go out and start analyzing different software solutions, it’s crucial to identify your accounting needs.
Business owners at different stages of development need such solutions out of different reasons. If you recognize yourself in any of the following groups, it’s high time you considered getting such a tool:
- Starting out professionally – Business beginners can benefit from accounting software because it will help them keep their financial documentation in one place. If you keep your financial books in an old-fashioned way – in binders and ledgers – or in different places, you might lose (track of) them. On the other hand, if you don’t keep them at all, you’ll have trouble with the authorities.
- Galloping growth – Even if you collaborate with an accountant, they won’t be able to cope with all the accounting data generated by a fast-growing business. You’ll spare yourself and your accountant a great deal of slow, manual work if you turn to software.
- Centralizing data – Apart from financial data, you can populate your bookkeeping software with all sorts of information about your clients. From payment and purchase records to storing contacts, it can serve various entrepreneurial purposes.
- Covering legal affairs – Overwhelmed by their everyday tasks, business owners often don’t have time to deal with the legal aspects of their business. Instead of adding a budget-gnawing lawyer to your payroll, you can rely on some ready-made features provided by accounting tools.
How much can you pay?
Money is of greatest importance when it comes to accounting software in every possible sense. In a nutshell, it takes some assets to keep track of other assets.
Therefore, setting the budget limit is an important step in choosing your software.
You’ll have to decide whether you’ll go for an in-house solution or a cloud-based one. The first option is better for a larger company that employs an accounting team.
The other one is recommended for smaller enterprises that still don’t know what their future will look like.
Cloud-based software solutions are scalable and easily adaptable to your current needs. That way, you’ll prevent yourself from opting for too large a package and ending up paying for the features you don’t even use.
Moreover, downloadable solutions will cost you more, since you pay license fees for them. For instance, you can get both QuickBooks Pro and Sage for $299, as two great on-premises software options.
On the other hand, the accounting solution Xero ranges from $9 to $70 monthly.
For more information about contemporary accounting tools and their pricing, read the complete guide on the Cloudwards website.
What to expect from the interface?
If you analyze contemporary design trends, you’ll see that intuitive is the buzzword of this niche. When you’re testing different accounting software tools, bear that notion in mind.
In line with that, the software interface has to be organized in a logical way, ensuring smooth navigation, regardless of your age and IT-literacy. If you don’t know what to do next at any point while using a tool, it will cause confusion and reduce work efficiency.
This is why it’s vital to let your accountants and other employees try several tools before you choose the right one for your business.
You should also prepare a questionnaire for each of the tools, so that you get feedback from your employees as they use them. For instance, all the basic features, such as estimates and invoices, payroll options and tax services should be easily visible and approachable.
Apart from that, accounting software designed in a user-friendly way will allow swift synchronization across different platforms in one or two steps. You can learn more about the most important features for accounting software in the analysis published by AccountTex Report.
What accounting features to take into consideration?
When you’re doing your research on the most suitable software for your accounting needs, you should get familiar with some practical features that it should have:
- Accounts receivable – Your software should be used for billing, as well as for tracking what your clients owe you. Keeping your payment history in one place will reduce the risk of losing or overlooking this important data.
- Accounts payable – Instead of scattering the notes on your financial obligations to different places, keep all the due dates and deadlines in one place. And there’s no better place for that than modern accounting software.
- Multi-user access – It needs to have several “slots” for different users, so that both you and your accountants can edit and sync it.
- Making and taking payments – Some modern accounting software tools allow you to process clients’ payments directly via credit or debit cards. What’s more, you can also link your bank account to your accounting system and automate the payment procedures.
- User-friendly invoicing – Nobody likes to wait when it comes to business and payments. So, make sure that the software you choose comes with proper invoicing options. For instance, setting and sending reminders in advance, before deadlines, is a great feature that will keep your clients alert when it comes to their obligations towards your business.
- Processing taxes – Your accounting system should also contain the basic tax forms. It will ensure that you don’t waste your precious time searching for another tool in the taxation season. Moreover, when you connect this system with your accounts, you can pay your taxes without going to the bank. However, some businesses should give advantage to traditional accountants over tax software. Find out more about the benefits here.
- Data security – The last thing you need is unauthorized parties prying into your financial data. Don’t forget to raise this question when you’re talking over the conditions and terms of use. Also, all the data kept online should be backed up, to save them in case of a hackers’ attack or a server breakdown. Make sure you discuss all these topics with your accounting software provider.
How can an accounting software improve work organization?
Apart from services that will help you cope with your obligations towards external parties, an accounting system can help you improve your in-house organization, as well. When you’re analyzing various solutions, pay attention to the following options:
- Inventory – Your software can contain various details on your inventory items. It will ensure that you always have an insight into the number of items in stock. Beside that, keeping track of the inventory in accounting software will help you control your budget, as well.
- Tracking workers’ efforts – Since many businesses rely on remote workers, they need to track the time their employees spend at work. So, choose an accounting tool that provides this feature. It will be useful for following the productivity of the office workers, as well. Moreover, it will give you a chance to calculate their work hours automatically, alleviating the process of calculating data for the payroll.
- Workers’ status – In addition to time tracking, accounting systems can also come with some basic project management features. They will contribute to better work organization and task distribution. However, as your business grows, you’ll eventually need to opt for a dedicated project management tool, but make sure it can be easily integrated with your accounting tool.
- Creating estimates – While estimates are useful for clients, they are of great importance for internal affairs, as well. Using a software solution that comes with easy-to-use estimate templates will help you organize your projects and time more efficiently, using your workforce potential as much as possible.
How much support do you get?
One of the crucial features when it comes to accounting systems is the amount of support you’ll be getting from their creators. This is especially important for business beginners.
We’ve talked about the importance of smooth interface design and the intuitiveness of its visual appearance. Still, some business owners and employees will find it difficult to master even the simplest design features.
If your workers have trouble with your accounting system, it will reflect on your overall productivity and business development. To avoid such growth obstacles, it’s vital to negotiate the support terms before you make your final decision on the accounting software.
In line with that, you should check if they provide basic training or video tutorials for people who are just starting to use their software. Even if the answer is negative, try to persuade them to prepare some simple tutorials or training sessions. That way, they would acquire and retain a new client and you would get invaluable training for your workers.
Furthermore, you need to ask the providers if they provide 24/7 customer support. If you communicate with a real agent in the customer support center, you’ll have your problem solved more quickly.
Who should be included in decision making?
When you’re analyzing the potential solutions for your business, you should include more people from your office in that process. This will bring several business benefits.
On the one hand, your employees will appreciate that you find their opinion valuable. On the other, if people who are going to use that system get an opportunity to test it in advance, it’s more likely that you’ll choose the right option.
Needless to say, your in-house accountant is one of the most important people in this choosing process. Even if you outsource accounting services, you should include that agency in the procedure of getting an accounting system. They could give you some useful advice on the most reliable solutions for your needs. Apart from that, your accounting associate could negotiate a discount for accounting software if they already collaborate with the provider you choose.
You will be the most important link in this decision-making chain, but including other people in this process can only have a positive effect on your business and its efficiency. So, it’s wise to form a trust of different minds, to get different opinions on various software tools.
This will ensure choosing more adequate software for your business needs.
The closing word
The market of accounting software tools is one of the most exciting markets on the global business stage. Thanks to the growth in the number of online businesses and accounting software providers, both groups of business ventures can choose from a wide range of options.
However, rushing into buying and using a system that doesn’t contain the features you need could lead to some disappointing results. Because of that, take your time to analyze dozens of tools before you spot the best one for your business and your employees.
The tips given in this article will assist you in making the right choice.
Latest posts by Mark Thomasson (see all)
- 4 Content Types You Should Include in Your Social Media Marketing Efforts to Boost Engagement - January 24, 2023
- 6 Modern Payment Methods That Companies Should Know About - November 30, 2022
- Social Media Marketing Plan – 8 Steps To Follow - October 18, 2022
