Accounting software is almost essential when running a business in today’s digital world. Minimising paperwork, getting a real-time view of performance and reporting with the press of a button are all selling points. Increasingly, regulatory compliance such as single-touch payroll requires electronic submission of data to the ATO. With all roads leading to accounting software, what criteria should you be using to choose from the many available features and providers?
Features of accounting software and their providers has exploded in the past 10 years. Canstar Blue recently surveyed 400 Australian business and discovered the following facts relating to how business owners view accounting software.
Making the decision to shift to accounting software
Do you need to shift to accounting software? Accounting has been done successfully on paper for hundreds of years, why shift? Stacking up the benefits of a shift to accounting software generally leads to:
- Less data entry – feeds from banks automatically updates your books with accurate data.
- Faster reporting – less time and cost is required to generate regular reports such as the dreaded BAS.
- More time for analysis – time saved in reporting can be better spent analysing data and making business decisions.
- Compliance – Single Touch Payroll for example requires any business with employees to report electronically to the ATO.
Top 5 Tips for Setting up Accounting Software
1. Make accounting software setup simple
Most agree the best time to setup the software is when you start your business. While you might not have that luxury, it is important to set up your accounting software correctly. This avoids fundamental reporting errors that could throw out your figures over the long-term. Getting your accountant to have input and help with the setup may avoid having to untangle things later on.
2. All or nothing, automate everything
Implementing accounting software is best done as an all or nothing exercise. Reporting on only part of your business operations defeats the purpose of having the software. All transactions, invoices and payments should funnel through your accounting software. No matter how simple of complex your business, accounting software should be setup to be the single source of truth for obtaining the financial position of your business.
3. Desktop vs Cloud software
Desktop software simply means the accounting software is physically installed on specific PC’s used by the business and/or accountant. Cloud software means the software is hosted by the software provider. Cloud based software is more accessible between the business, accountants and other parties needing to have a view of the accounts. It is also generally easier to setup and software updates, backups and security is in the hands of the software provider who is mostly more capable of doing these activities properly.
4. Take advantage of free trial periods
Deciding on a software provider can be confusing. Knowing what features you will need both now and in the future. It’s also good to make sure you’re not paying for what you may never need. Free trial periods allow you to actually test the software meets your requirements, how easy it is to use, how compatible it is with other systems and what the customer service experience is like.
5. Explore specialist industry providers
While the major software providers like MYOB and Xero have targeted the mass market, don’t underestimate smaller specialty accounting software packages which may have specific features designed for your industry.
The vast majority of business owners believe accounting software is vital to operating their business. Which is why it’s important to invest time in finding the right software for your business and make sure it is setup correctly. This will allow you to save time reporting and allow more time to analyse business performance and make corrective decisions earlier.
Saige Accountants are experts when it comes to accounting software. We are agnostic when it comes to accounting software and are comfortable using the software that best suits your business. Still, we have our favourites and can recommend what providers and features your business may need. We can also ensure your accounting software is set up correctly from the start.