Deciding on the right features and ideal accounting software for your organization should boil down to understanding the solutions available in the market, what they offer, and how they relate to your business needs.
Here are the most important capabilities you should look for in a good accounting software.
1. Ease of use
Modern accounting software is often designed with maximum ease of use. However, it's still important to look at the program's interface in detail to determine if it's intuitive enough for anyone on your team to use — even those without accounting or tech savvy.
In addition, your choice of software should also be very flexible and practical. We recommend options that provide multidimensional reporting features that enable your team to come up with customized reports based on your company's needs and goals.
2. Integration of billing and invoicing features with inventory management
Accounting systems will have different core functions, and almost all of them will involve billing, billing, and/or inventory management. However, if you have all of these essential features integrated into one system, you will be able to cut down a significant amount of time moving or migrating data from one system to another.
3. Identify and prevent errors
Accounting solutions can bring more accuracy and efficiency to your organization. This means that errors can be reduced, if not eliminated. As such, the software you choose should have features that automatically check for (dynamic) errors. For example, when someone places an order for a product that is currently out of stock, the system can identify the action and send an instant alert. We also recommend looking for features like auto-calculation, which are essential to prevent users from making mistakes.
4. Cloud readiness
Many accounting packages have versions installed on-premises and versions used in the cloud. It generally makes sense to use a cloud version accounting package. At the very least, check to see if one is in development and when it's expected.
There are two main reasons why cloud-based accounting software is preferred over locally installed software. The most obvious one is that it facilitates remote work. This is especially important for small and medium businesses because relatively few of them have in-house accountants or in-house finance teams. Instead, they will rely on freelancers.
Another reason is that cloud-based software is automatically updated by the vendor. This ensures that you take advantage of security updates as soon as they become available. Another benefit is that any legal changes (for example, changes to tax laws) are automatically applied at the correct time.
A quality accounting package will handle much of the day-to-day work of regular bookkeeping. This includes:
- Update ledger entries to track revenue and expenses
- Bank reconciliations
- Track asset depreciation
- Tax calculation
- Payroll and deductions management
In addition, it will have error prevention capabilities such as automatic calculation.
6. CRM capabilities
Modern accounting software can basically be a customer relationship management tool for the financial side of your business. For example, it might send invoices automatically, follow up with reminders if needed and highlight if there is no response to those reminders.
Relevance, in relation to accounting information, is a characteristic that can help individuals make decisions about a company's financial affairs. For accounting information to be relevant, it first requires confirmatory value, which provides information about past financial events, and then predictive value, which can provide predictions about future financial events. A business must have proven and predictive value to develop accurate accounting information.
Professionals consider accounting information relevant if it provides information about past events that can help make predictions about future events, which will hopefully lead to more profits or help solve any upcoming financial problems. For example, if a business owner wants to invest in a new asset, he can look back on his previous investment history since that information applies to any future investments he makes.