Running a business comes with lots of different hats and different matters we need to deal with. One of the things we need to consider is record keeping.
It is a requirement from HMRC that records are kept in a correct manner, that they are accurate and factual and that they are up to date. Accounting software ensures that your records are compliant.
That is, however, not the only thing that an accounting software can provide and so I wanted to let you know what are the main benefits of an accounting software. Before you ask, there are no real disadvantages of accounting software, well apart from the cost (which is always tax deductible anyway).
So, what are the main advantages of accounting software?
Most accounting software is in the cloud which means that you are able to keep your records up to date no matter where you are – even on the beach!
The software uses security that is encrypted and secure. This protection is standard and not additional costs for small businesses compared to the big companies.
If you are not a VAT-registered business, you need to be aware of your turnover figures to know whether you need to register for VAT. You are able to run reports at any time to determine your 12-month rolling period and therefore determine if you need to be VAT registered.
If you are trading as a limited company you need to ensure that the company is profitable before being able to take any dividends from the company, the software can provide you with a profit and loss account that can help ascertain if a dividend can be paid.
There are lots of different apps that you can add to software to enable bookkeeping to be easier, to be faster and more efficient. Artificial Intelligence is an amazing thing and is available to us in many different forms, one example is the upload of invoices that are read by the software and processed easily into the accounting software.
Details of debtors can be easily obtained which will mean we are able to chase funds and hopefully ease cash flow.
Better decision-making can be made by using various reports included within the software. These can help with stock control, purchasing power and can be bespoke to the user’s needs.
There are lots of different types of software available so it may be hard to decide which is the best one. The best advice for someone seeking the best software for their business is to speak to their accountant before embarking on software to ensure you are able to have the right one for your business.
Once you have accounting software in place, it is beneficial to understand its uses and ensure you are able to find the reports and information needed to enable you to support your business.
You may want to listen to the podcast – Your Business Hour. Podcast 8 – the various accounting software from a user’s point of view may be an interesting listen.
Please always seek professional advice before taking any action. We are happy to answer questions in future issues. Please send your questions through the contact us page on our website: www.champconsultants.co.uk
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