What are the Benefits of Accounting Software for Your Business?

Today’s accounting software has become a vital requirement for every business. Business owners are beginning to realize that managing finances manually does not help them achieve the expected efficiency. Financial management that should be able to help companies manage their budgets more efficiently is even one of the factors causing losses. Business owners are beginning to realize that managing finances manually does not help them achieve the expected efficiency.

If you are currently thinking about automating financial management in your business, this is the right article for you. Before deciding to use accounting software, it is better if you understand its functions first.

What is Financial Management?

Before learning about the use of accounting systems for businesses, you need to first understand what financial management is. Financial management refers to the strategic planning, management, direction, and control of financial processes in an organization or company.

Financial management is important for every business to ensure stable cash flow. The task of the financial manager or the person responsible for managing the organization’s finances is to estimate funding needs, determine capital structure, create investment opportunities, make financial-related policies, make financial decisions, and much more.

The goal of financial management itself is to optimize profits, ensure business survival, maintain proper cash flow, minimize capital costs, and optimize market share. Without good financial management, businesses will find it difficult to achieve their objectives and experience a lot of losses that lead to bankruptcy.

Understanding Accounting Software

Accounting software or accounting systems (also called financial applications) are software designed for accounting professionals to manage accounts and simplify financial operations in an organization.

A simple accounting system is usually a simple single entry program that is used for storing individual data, while a more sophisticated accounting system can be used to manage debts and receivables, ledgers, invoices, salaries, and even organizational assets.

Today, accounting systems are crucial software for any business. This software allows tracking of detailed financial transactions and making various financial reports instantly.

Before there are financial applications, financial tasks must be done manually, using a large transaction journal. Making a report is generally impractical, because accounting managers must consolidate entries manually. Financial applications automate these tasks, reduce accounting costs, and enable better financial decision making through real-time reporting.

Benefits of Accounting Software for Your Business

Accounting professionals consider the accounting system as a corporate asset that can significantly improve the efficiency of the finance department. Beyond that, some other important benefits that this software can provide to your business are as follows.

Ensuring Good Financial Control

Accounting software allows business owners to control their finances automatically, even if the business owner is not an expert in accounting. With a little training, business owners can manage all of their accounting operations using their computers or mobile devices without having to pay external parties to control their budgets.

Save Company Costs

The financial application automates the calculation of principal and administrative procedures and regulates the composition of your budget, so you don’t need to outsource financial management to external parties. This software can also reduce costs associated with printing and providing documentation, because all data is stored digitally in a safe and monitored location.

Improve Data Accuracy

According to the accountant or auditor, one of the important benefits of a good financial application is that this system can minimize the human errors that commonly occur when calculating and entering data. Inaccuracies in financial statements can cause crises that have an impact on business continuity, and the accounting system can prevent this from happening.

Simplify Decision Making

This is one of the main advantages of a sophisticated accounting system. Without this software, you will have difficulty understanding in detail your financial condition. This system gives you numbers that can help you understand where to cut expenses or where to invest more.

With a clear picture of your current financial situation, you will be able to more easily develop smart strategies and allocate resources appropriately.

Improving Financial Data Security

Financial data is confidential company information and must be maintained so that it does not fall into the wrong hands or be lost. The accounting system ensures your financial data remains safe by storing it in a centralized system that is protected by a firewall. Only those who are granted access rights can see it.

Increase Employee Productivity

Making financial reports and tidying books is a very time-consuming job. To do this work manually, your employees may have to sacrifice other important work. Not to mention if they have to fix errors that often occur when accounting tasks are done manually. However, with accounting software, all financial tasks can be done automatically so that your employees can do other work that is valuable for your business.

General Features in an Advanced Accounting System

Each accounting system has advantages and disadvantages of each, but there are some main features that should be present in a complete and sophisticated accounting software. The following are some of them:

Financial Forecasting

This is perhaps the most crucial feature of the accounting system. Every business naturally wants to be able to estimate their costs and revenues appropriately. Forecasting tools help control finances wisely, eliminate unnecessary costs, and optimize profits.

Billing and Invoicing Management

Sophisticated financial applications provide features that make it easy for business owners to create, manage and send various types of billing and invoicing. E-invoices complete with various components can be customized according to the preferences of the business owner and can be made in a very short time.

Account Reconciliation & Bank Reports

Reconciliation is an important step to ensure the accuracy of your financial data. If done manually, this takes a very long time and human errors can occur at any time. However, with a modern financial application, you can reconcile your bank accounts and statements in seconds.

Making Financial Statements

The accounting system allows you to produce financial statements (profit and loss, balance sheet, changes in capital, cash flow, etc.) digitally. You can also make it in several versions; tables, graphs, lines and circles.

Purchasing and Sales Management

A good accounting system is integrated with buying and selling so that it allows you to manage transactions whenever you want. You can easily create various documents such as purchase and sales orders, debit and credit notes, offers, receipts, and much more.

Asset Depreciation Management

With complex financial applications, you can even calculate asset depreciation automatically and accurately. Asset depreciation can be calculated by various methods according to your company’s policy. This calculation is in accordance with applicable tax and accounting standards.

Conclusion

Accounting system is software that makes it easy for business owners to manage various processes related to finance, completing financial tasks correctly and quickly. This system does not replace the role of accounting managers in managing the organization’s finances, but instead facilitates their work so they can work more productively.

Without the help of an accounting system, business owners or accounting managers can spend too much time creating financial reports, making various documents, or reconciling bank accounts and reports. This software helps them get complete visibility about their financial condition, so that decisions can be made more wisely.

HashMicro provides a complete accounting system that has been adapted to the taxation system in Indonesia. Our accounting system can be implemented in several ways, namely as an on-premise system, a cloud-based system, and a mobile application, according to the needs of each user. Contact us for more information about our accounting system.