Managing your small business is hard enough and staying on top of your finances is even harder. From sending invoices to paying bills, tracking expenses, managing daily transactions and paying. You are not an accountant and you do not have so much time to deal with numbers after a long day work.
A useful and easy operational accounting software can help you organising these tasks, so you can spend less time dealing with your finances and more time running your business. Remember that even having an accounting software, you will need to utilise it regularly by not putting off managing the tasks to the end.
If you are not the type of person who are able to cope with additional workload in dealing numbers, don’t worry. You will need more help from your bookkeeper and accountant to assist you to get your finance in order before they become out of control. You need to pay frequent visits to them or request them to meet you after-hour or at your premises if you are not able to leave your shop at all.
What to consider?
Every business will have different requirements from an accounting software. When choosing an accounting software consider the following:
- Does the system calculate all payroll requirements (PAYE, annual leave, long service leave etc.)
- Does the system track stock, work in progress, orders, jobs and other task management requirements
- Will the system be able to handle multiple bank accounts
- Does the system need to handle foreign currency
- Does the system track separate financial records for each business or department within the business
- Does the system allow for interface with other computer systems such as online payments
- Does the system keep detailed records on customers including what they buy, how often they buy, when they buy etc (often referred to as a Customer Relationship Manager system).
Software options
There are many software packages on the market that allow business managers to successfully control records without an accounting degree. Some popular accounting systems used by small businesses are:
- MYOB External link (opens in same window)
- Quicken/QuickBooks External link (opens in same window)
- Reckon1 External link (opens in same window)
- Sage External link (opens in same window)
- Xero – online External link (opens in same window)
- Cashflow manager External link (opens in same window)
- Nominal External link (opens in same window)
- Saas – online External link (opens in same window)
Setting up a bookkeeping system
When you set up your financial records you need to make sure they meet any compliance requirements such as GST or other tax compliance. This is done through setting up classifications, also known as a chart of accounts.
A chart of accounts is a listing of all the accounts needed to cover the financial transactions of the business. Classifications are used to separate profit and loss calculations to show where a business is making or losing money. It is also used to determine the overall financial position of a business in a balance sheet.
Getting advice
Even after you have set up your accounting system, you still need to check with your accountant or bookkeeper regularly so you know you are on the right track. It is always better to check with the professionals at the start of your business. A correct use of accounting software will save you time and tax bill for sure.
| DISCLAIMER |
| Kasker Associates website is to provide information of general interest to their clients. The content of this website does not constitute specific advice. Readers are encouraged to consult their tax adviser for advice on specific matters. |