A business must enter all its financial transactions in its books of account. It helps the accountants in tracking the incoming and the outgoing flow of cash through the business. Nowadays, the cloud based accounting systems maintain and process the books of account.
The corporate environment of every country is bound by certain statutory obligations. ACRA (Accounting and Corporate Regulatory Authority) of Singapore governs the corporate sector in Singapore. This agency has the duty to ensure all industries, irrespective of their size or niche, comply with the amended set of statutory requirements. Updated books of account, filing of financial statements, and paying taxes in time are the essential factors of these obligations.
The act of recording each financial transaction of the business and then, periodically checking the books of account has a far-reaching meaning to the business owners. The accounting software reduces the amount of manual work involved in the task. Each time, it processes the business data accurately and unfailingly. The software takes only a few seconds to process the data. The results obtained denote the financial health of the business.
A cloud based accounting system saves and processes the business’ financial data on the cloud servers. It transmits the results to the business owner’s device, which can be an internet capable mobile or tablet. The software can also transmit the reports to the laptops, net books, and desktop computer.
The accounting software systems generate financial documents like cash flow, balance sheets, and profit and loss accounts for the inspection of the owners. They get a detailed info about the working and the financial standing of their businesses. The software also updates them about the financial position of their businesses with respect to their suppliers, customers, and creditors of their businesses.
The accounting software allows the owners to know about the fluctuations in their bank balances. It allows the owners to keep a firm control on their credit and debit situation. It ensures that they do have a chance to take appropriate actions before the commencement of a financial disaster or a broken commitment.
Accounting Software Systems
The choice of accounting software, in some instances, depends on the business owners’ requirements.
1. Basic Accounting Software: This is basically, a tool with the limited functionality. It is often used to generate an income and expense statement of the business.
2. Advanced Accounting Software: This is a tool developed to produce a balance sheet depicting debit and credit values, bank balance, and assets of the business.
3. Cloud based Accounting Software: These comprehensively designed systems analyze and generate various types of reports. The reports help in understanding the performance, productivity, and the profitability of the business.
Benefits of Online Accounting Software
The online accounting software assists the owners in avoiding the mistakes that often creep into the manual processing of financial data. These tools allow the owners to confront and measure the reality of their business. They can then, plan and execute the remedial measures in a timely manner. The software assists them in the following tasks.
1. Generation of financial statements like cash flow, balance sheet, and profit and loss accounts
2. Maintenance of general, sales, and purchase journals
3. Generation of quotations, sales invoices, purchase receipts, and credit and debit notes
4. Data entry of the purchase orders, purchase returns, sales returns, and in issuing of notes for the spoilt or missing items
5. Assigning multiple price lists to the chosen customers and suppliers
6. Handling of project allocations at transaction input, aging distribution opening brought forward, and basic budget input
7. Generating reports like the opening balance, ledger listing, bank book, bank details, and bank reconciliation statement
8. Understanding the trial balance, balance sheet, statement of account, closing stock analysis, due date and aging analysis
9. Tracking of top stock movement, poor stock movement, and salesmen reporting
Accounting Software Reveals the Worth of a Business
The profit and loss account and balance sheet are very useful for diagnosing the health of a business. The business owners having accounting knowledge come up with an effective financial control strategy. They can wring out the best performance from their organization using the available resources.
The use of financial data, comparison of the past and present results, and the financial standing of the business assist the owners in judging the effectiveness of their sales, advertising, and marketing campaigns.
The cloud based accounting software systems reduce the business activities and achievements to the solid numbers that even a layperson can understand.