Your accounting system is the backbone of your small, growing business. It helps you keep tabs on expenses and cash flow, automates processes such as invoicing to save your precious time, and ensures that you keep accurate financial records.
Choosing the right package for your business's needs will help you be more productive and efficient. There are many business solutions to choose from - ranging from standalone, entry-level accounting packages through to integrated enterprise resource planning systems.
Tamsin Bradford, Operations Manager at Sage Pastel, gives some advice on what to look for in your accounting package.
1. Security
Your financial information is sensitive and important - so you need to be sure that it cannot be stolen, lost or accidentally destroyed. Check that your software allows you to password protect your data so that it cannot be viewed, copied, or tampered with by unauthorised users. A good package will feature strong authentication processes for login. Depending on your needs, you might want to invest in database security. Also, be sure that your PC is password-protected, runs the latest security patches and has up-to-date antivirus software.
If you choose an online or 'cloud' accounting package, be sure that your provider is a reputable company with a good track record of keeping data safe. Don't be scared of the cloud - a good online software provider will have a secure infrastructure (better than you could put in place with an SME budget) and will keep your data backed-up and secure for you.
If you are not particularly clever with computers and don't have an IT guy to help you, a cloud service could spare you the trouble of doing back-ups and patching software. If you want more control than you could get with a pure software-as-a-service solution, a hosted solution could give you the optimal control and security over your data and applications.
2. User experience
If you're running a busy small business, you probably don't want to spend too much time and money on learning a new system or training your bookkeeper. You should look for a system that is as simple and intuitive as possible, while providing all the functionality you need to run your business.
Look for software which uses plain English rather than accounting jargon in its interface and presents your financial information in an appealing and easy to understand manner. The ideal package will allow you to do basic accounting tasks with as few clicks as possible.
It should be easy to set the software up with templates and to change configurations if your business changes. Then, the software should allow you to quickly and efficiently create, manage and customise invoices, quotes and purchase orders.
3. Functionality versus price
Not all accounting packages are created equal - some are designed for micro enterprises and others for top 100 JSE-listed companies. The one you choose should offer the right mix of affordability and functionality for your business. Remember that the more complex the software gets, the more pricy training and installation will become.
Depending on the needs of your business, you might want to go for an entry-level cloud service that you access online and pay for by the month. This will allow you to get up and running quickly, and without upfront costs for servers and software licences.
On the other hand, if your business is specialised and growing fast, you might opt for a modular package that lets you start with the basics and add more advanced modules (e.g. job costing, point of sale, manufacturing, multi-currency support) as you need them. The bottom-line is that reliable accounting software is surprisingly affordable these days - even more so if you buy it as a cloud service.
4. Technology
New trends such as cloud computing and mobility offer new ways for you to be productive. Tasks that need an accountant's or manager's sign-off don't need to come to a standstill while the boss is out - which means big time-savings and possible improvements to customer service.
For example, it could make a huge difference to your efficiency if you could send a purchase order to a supplier or an invoice to your customer from your iPad when you're on the road to visit customers. It's worth making sure that you choose a package that can support more flexible and immediate ways of working in today's real-time business environment.
5. What your accountant is using
If you outsource your accounting, choosing the same package as your accountant uses will make it quick and easy to share information. This, in turn, saves time for you and your accountant.
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