If you are like most business owners, the stacks of receipts, confusing spreadsheets, and the mere mention of tax season might give you nightmares.
You have probably heard tales of lost invoices causing payment chaos, manual mistakes leading to big financial blunders, and countless hours spent fixing errors. Well, the world of accounting baffles even the best of us.
The good news is that you can keep all these issues at a safe distance with the help of accounting software. It can streamline the financial management processes and enable you to focus on what truly matters: growing your business.
That said, all accounting software programs do not provide the same functionality. So, if you want to handle financial affairs like a pro, make sure your accounting software contains the following features:
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Customizable reports offer flexibility in terms of showing data. In other words, they help businesses to select relevant metrics, filters, visualizations, and formatting options. Arguably, the biggest upside of this feature is that it bridges communication loopholes.
When it comes to analyzing financial data, different teams and stakeholders in your company may have different requirements. For example, if you own a real estate business, you might have to comply with certain rules and regulations.
One such regulation might be GASB 96. Issued by the Governmental Accounting Standards Board, this guideline introduces lease accounting standards within the public sector to enhance transparency and accuracy in financial reporting for government entities. If one of your departments needs help with GASB 96 lease accounting, having the option to customize reports can be helpful. Similarly, another department may need you to provide specific information to stay on top of IFRS 16 lease accounting standards, which require lessees to recognize most lease obligations on their balance sheets.
By customizing reports to each department’s specific preferences, you can ensure that the information is easy to understand and actionable for each group. It improves cooperation amongst teams, leading to a more united strategy for reaching organizational objectives.
As your business evolves, your reporting requirements may change over time. Customizable reports allow you to adapt to these changes without requiring extensive IT support or development. Whether you need to add new metrics, modify existing calculations, or rearrange data fields, you can do so without waiting for external assistance.
Cloud-based accounting software stores information on secure servers in data centers. As a result, you can access your financial information from anywhere with an internet connection. So whether you are at home or in the office, you can easily manage data, process transactions, and generate reports with just a few clicks.
Furthermore, cloud-based access promotes real-time collaboration among team members and accountants. Multiple users may simultaneously work on the same set of financial data, view updates in real time, and even communicate directly within the platform. It streamlines workflows and reduces the need for back-and-forth communication via email or other mediums.
The best part is that your IT team will not have to keep up with the hassle of maintaining the software on individual devices. The responsibility for updates, security patches, and infrastructure maintenance lies with the cloud provider.
Contract, Expense, and Asset Tracking
Many businesses waste a fair proportion of money annually due to inefficient contract, expense, and asset tracking.
Inaccurate management of contracts can lead to potential legal complications. With the contract tracking feature, businesses can set up alerts for contract expirations, review key terms and conditions, and ensure compliance, all within a centralized and easily accessible system.
Among other things, inadequate procedures for monitoring costs result in overspending and challenges in maintaining correct financial records. These financial leaks ultimately dent a company’s bottom line and hinder its growth potential in the long run. That is why expense tracking is a must-have feature in your accounting software.
You can use this function in various ways. To give you an example, let’s say your organization usually requires its staff to travel for work. With manual expense tracking, there might be a risk of receipts getting lost, expenses being recorded inaccurately, and reimbursements being delayed. Apart from creating frustration among employees, it will also pave the way for financial discrepancies that can be difficult to rectify. However, with accounting software’s expense tracking feature, employees can easily capture receipts using their smartphones, categorize expenses on the spot, and submit accurate expense reports. Managers can then review, approve, and process them swiftly.
Besides, expense tracking empowers businesses to identify patterns in spending and make informed decisions. So, if you are using subscriptions that are rarely used, the expense tracking feature will highlight them. After that, you may cancel these underutilized subscriptions right away and direct your budget toward initiatives that provide higher returns.
In addition to contract and expense tracking, asset tracking provides a powerful means to manage valuable business resources. Businesses can keep tabs on assets like equipment, machinery, or even digital assets to reduce the risk of loss and optimize budget allocation for maintenance and replacements.
Cybersecurity has become a pressing concern for businesses of all sizes. By 2025, cybercrime might cost businesses throughout the world $10.5 trillion annually. It is a substantial increase from roughly $3 trillion in 2015. That is why the integration of data security features is critical for accounting software.
An accounting software program keeps up with confidential financial information. It may include details like income, expenses, tax information, bank statements, loans, and more. Any unauthorized access to such sensitive information could pave the way to identity theft, fraud, or other financial crimes. Therefore, strong data protection measures are a must to stop these malicious activities.
The market is peppered with several accounting software programs where vendors boast about their data security features. However, you must gauge the data security measures beforehand.
Reliable accounting software would ideally use strong encryption protocols to secure data. So, when assessing the software, look for features like SSL/TLS encryption for data sent over the internet and encryption of stored data. This ensures that even if unauthorized parties intercept the data, they will not be able to decipher it.
With various financial obligations such as invoice payments, loan installments, tax filings, and payroll deadlines, businesses may get overwhelmed and overlook important dates. Auto reminders alleviate this challenge by sending you timely alerts, ensuring you never miss a critical deadline. It can save your business from potential late fees, penalties, or even legal consequences associated with missing important dates.
Plus, automated reminders add to your time management strategy. As a business owner, your plate is likely already full with a host of responsibilities. Manually tracking and setting reminders for each financial task can be time-consuming and error-prone. With automation, you can delegate this task to the software. It will free up your time to focus on higher-value activities that contribute directly to your business growth.
We cannot stress enough the importance of accounting for a business. It can virtually make or break your organization. Fortunately, performing accounting-related tasks does not have to be stressful anymore, thanks to the advanced software programs out there. For superior operational efficiency, make sure your accounting software contains the above-listed features.
I’m a writer, artist, and designer working in the gaming and tech industries. I have held staff and freelance positions at large publications including Digital Trends, Lifehacker, Popular Science Magazine, Electronic Gaming Monthly, IGN, The Xplore Tech, and others, primarily covering gaming criticism, A/V and mobile tech reviews, and data security advocacy.