If you’ve recently started a small business or are planning to in the near future, your to-do list has probably never been longer. With so many things to consider, it’s easy to forget essential details when focusing on the bigger picture. Accounting software is one of those essential tools that small businesses should never neglect, but it often slips by the wayside in favor of more exciting projects like a shiny new website. Here are some reasons why you should always invest in quality accounting software from day one.
You might think you have your accounts handled thanks to your trusty spreadsheet. While this may have served you well when your business was still a hobby, it’s easy to lose track of profits and expenses when orders start to come through at a much higher rate. A single miscalculation or incorrectly placed decimal point can throw off your numbers for the whole year, which can be disastrous once tax time rolls around.
Accounting software is specially designed to keep all your transactions safe and secure. There’s no need to worry about accidentally deleting a sale or adding up your yearly total incorrectly, as this will all be done for you.
Keeping your client data safe should be a priority for businesses of all sizes. It’s true that you can password protect your spreadsheets, but that won’t do much to deter hackers. Similarly, a computer virus can easily wipe your hard drive causing you to lose all your data. If you have a backup, how secure is it and do you update it after every transaction?
Accounting software will have inbuilt protection to deter hackers and malicious computer programs. It will keep your data safe, allowing you and only you to access it whenever you need to.
Many types of accounting software can offer better cashflow visibility, helping you to understand what money is coming in and how much you have to invest in improving your business. This is especially important when you first start your business because you probably won’t be sure how many customers will make purchases in the next few months. Having visibility over your cash flow helps you to make informed decisions, meaning you’ll never be spending money you don’t have.
Accounting becomes even more complicated when you have employees to think about. You need to make sure everyone is getting paid on time while sending out payslips and registering all of this information with the tax office. It’s not easy to do if at least part of the process isn’t automated. Accounting software can help you to get everyone’s salary to them on time while keeping track of your own finances.
Accounting software isn’t just about the day-to-day. At the end of each quarter, you’ll be able to pull reports that will break down your expenses, taxes, and profits, helping you to understand where there’s room to grow. You’ll be able to keep records of years gone by to track your business’ progress.