Organisations, may they be for business or non-profit, use money almost on a daily basis. Aside from spending for products and services, they also receive funds from different sources. As transactions become more complex, the more challenging it becomes to account how money is utilised. To address this concern, organisations use accounting software.
Accounting software is an application that is used to keep track of accounting records and generating reports. It is used by both individuals and organisations to maintain clear and transparent documentation of the funds they receive and spend.
Among the reasons to use accounting software are:
Improves efficiency
Using accounting software helps you focus better on achieving your company’s business goals. You can keep track of all the transactions and accounting records much more quickly. You can easily search for transactions without having to dig through different workbooks too.
If your company opts for cloud-based software, you can even do your bookkeeping from just anywhere in the world as long as you have an internet connection.
Automates accounting
Accounting software can help to reduce manual work as such work can now be automated. You can use the accounting software to add up totals so that you will not have to calculate any figure manually. It can also be used to generate invoices or receipts for your customers and suppliers as well as other internal use statements.
Since it is automated, the risk of making any mistake due to calculations is largely reduced. It will be less likely for you to wrongly state your revenue and expenses.
Protects you during audits
When it comes to annual audits, your accounting software can also help save you time. You simply have to open up your software, print out the relevant records requested by your auditors and hand it to them.
You will also realise that with accounting software, the audit trail of each transaction is much clearer. It will very often result in much fewer queries from the auditor. This way, you and your employees can focus on your on-hand tasks during an audit instead of having to face tons of unnecessary questions from the auditor.
Gives you a running history of your business
Having accounting software to keep track of your company’s data allows such data to be at your fingertips when you need them. All you have to do is click and type using the software’s search function and the accounting software will do the digging for you.
These past records are very useful when you want to assess your business’s performance in the past few years or use them to set up a budget for your company. With realistic past records as references, better goals can be set for your employees to achieve.
Moreover, you can also utilise the software to see if your company is spending within its budget. Simply ensure that all transactions in the software are up to date and you can generate reports to perform a comparison with your budget.
Simplifies tax filing
You can easily retrieve the information required when the time comes for you to file your company’s tax.
For example, if your company is a Singapore entity, you will need to file your company’s GST return to the Inland Revenue Authority of Singapore (IRAS) quarterly and submit the e-File Corporate Income Tax return in November.
Instead of having to scramble everywhere to gather the required details, you can simply go to your accounting software to download the details and fill in the tax return accordingly.