Today we look into 3 significant ways spreadsheet can limit your business growth.
Many small businesses begin their account keeping journey with Excel. One of the major reasons to do so is that Excel is widely popular and easily accessible. Unfortunately maintaining books on Excel or Google sheet spreadsheets can be risky, inaccurate and time-consuming.
Business owners and accountants are so used to working on spreadsheets that they never question why they even continue working on them!
Accurate financial reports are one of the most important things for running your business efficiently. Recording transactions and financial activities on spreadsheets make your business reports prone to errors. With just one bad call on your spreadsheet cell and your numbers will be distorted.
Here are three major ways that spreadsheet fall short when used for accounting (even for small businesses!)
- Spreadsheets Are Prone To Error
Spreadsheets make it easy to keep making errors. A simple mistake like misplacing a decimal point or an extra zero at the end of a figure can surely result in a huge accounting error. A spreadsheet is simply a medium that contains your data and doesn’t offer the functionality of analysing the information in depth.
Using cloud-based accounting software means that your financial records are updated instantly. This also means that you completely override the danger of copy-and-paste errors.
And since everyone in your business has the access to the same data, you don’t have to spend time wondering if there’s a newer version of your accounts stored on someone else’s computer.
2. Spreadsheets Don’t Give You the Big Picture View
Sure you can create some comparative bar graphs from your Excel data, but it is extremely time-consuming and frankly, who has the time to go through all the menus and options?
If you want to see the big picture, analyse your sales trend or want to keep an eye on your net-worth, you end up spending hours sifting through and analysing data manually.
A robust online accounting software like Giddh, can help you keep an eye on the financial health of your business. Online accounting softwares come with real time dashboard that provides you with the big picture view of your business. Using them you can-
- See your net worth, compare revenues, analyse profit/loss.
- See who owes you on overdue and who you owe money
- See the amount you’ve spent in your expenses and create strategies on how to curb those expenses.
3. Spreadsheets Can’t Keep You Tax Compliant
As we mentioned above, spreadsheets are just a medium on which you can store your financial data and do basic math calculations to generate basic reports. But what about tax compliance?
With the introduction of Goods and Service Tax(GST) now every small business will have to register and submit their GST returns.
If you keep using spreadsheets, you will have to manually download a GST return sheet and upload your data manually to file your return. Or worse, seek assistance of an accounting professional for the simple task of return filing and pay them an additional fee for the same. This is a process filled with hassles and you as a business owner can’t waste your time or resources on this.
Using cloud accounting software, you don’t need to worry about seeking assistance from any accounting professional for filing your GST return. Most accounting softwares today come GST ready, so the invoices you create will be GST compliant and your returns can be filed more easily as the return file is automatically created.
Transitions can be complicated. Adapting to the newest trends and automated accounting software requires the business owner to learn how to use new software. However, this change is necessary if the business wants to grow their profits, curb unnecessary hassles and operate more productively.
We’re sure you must be excited by now to know more about cloud accounting. If so, here’s a list of the 5 top signs your business is ready to make the transition from offline to online cloud-based accounting.
And of course, as always we are happy to answer any questions you have about cloud accounting or just discuss about the marriage of accounting and technology.