The world of accounting has undergone a rapid transformation in the last few decades. Technology has made inroads into almost every aspect of account management. Hence, it is not surprising that professionals now find it mandatory to be well versed with the latest tools and tech in their domain.
Being technologically challenged no longer cuts the ice.
First and foremost, the role of accounting professionals has changed. They are no longer certified accountants focused on creating balance sheets, keeping your books and preparing the P&L accounts. A modern accountant has assumed the role of a business mentor, in addition to performing the conventional accounting duties using account management software. The fact that account management has now become reliant on digital tools and online account management has necessitated that the accounting professionals gain proper knowledge of such tools and how to choose them for their business.
There is a deluge of online account management software programs or other account management tools in the market, each based on the latest technologies.
Let us take a look at some of the most prevalent technologies powering modern account management:
1. Artificial Intelligence:
Artificial Intelligence has impacted digital technology in the 21st century in a significant way. Routine tasks and complex as well as recurring processes, are being automated using predictive techniques. Today, financial institutions of all sizes use automation and online account management tools to handle large volumes of transactions in real-time and a less error-prone way. Further, the automation reduces deployment of workforce and other resources and brings down the costs involved. Hence, AI and cloud-based account management software are one of the key tools available today.
2. Cloud-based software:
Cloud tech is another major disruptive innovation of the modern era. Initially perceived as a shared online computing and storage tool, the cloud technology has grown by leaps and bounds. It is an internet-based computing system that facilitates advanced computing, data processing, analytics and storage options to computers and other digital devices connected online as per their need.
In the world of accounting, cloud computing has come across as a game-changer, as the modern accountants are able to execute accounting tasks from any place, at any time by simply logging into their tablets, smartphones or laptops. They can generate updated accounting details, track transactions, make entries, pay taxes, generate forms and reports and share financial details with their clients through these cloud accounting software. This freedom of access has given a new dimension to the client-accountant relationships and boosted the accountant’s role as a business advisor. There is more time to deal with clients and prepare business strategies than being burdened by mundane paperwork.
3. Evolution of Taxation:
In the modern digitized world, the process of taxation has become entirely computerized. Contemporary tax software not only provides better accuracy but also prevents miscalculations. That is a much-desired solution for companies keen to avoid being penalized for taxation errors or dealing with legal issues. The right accounting software can also make audits a breeze and not the nightmare that they traditionally appear to be. Hence, it is imperative for a modern accounting professional to have hands-on expertise and an understanding of the latest accounting software available in the market. An accountant needs to be at ease with various businesses and financial processes to be a capable professional who can meet modern client requirements.
4. Accounting on Mobile:
The modern accountant is always on the move. Travelling from one client meeting to another, one discussion to another, their reliance on mobile devices has been on the rise. They have to access data, generate reports and have round the clock connectivity with their clients. This is why modern accounting software companies are creating mobile-specific solutions for such dynamic account management access. Mobile accounting apps for Android and iOS continue to be developed and launched at an ever-increasing pace to help businesses both big and small in the management of their business processes on the go.
Blockchain is another technological innovation that has taken the world of online transactions by storm. It is also making an impact on the accounting processes and holds immense potential for accountants in the near future.
Blockchain is a network that distributes and decentralized databases and their management. It offers features such as data encryption and maintaining a detailed record of various transactions conducted by all stakeholders involved. We have already seen how Blockchain has experienced widespread usage in the form of crypto-currencies. The same disruption is bound to happen in the financial and accounting sectors.
At present, accounting processes follow a double-entry bookkeeping system. The accountant documents and verifies the financial details of a company and the independent auditors verify the same. However, the introduction of blockchain technology can do away with such redundancy as the data is verified independently. Each transaction under blockchain technology is automatically audited. This can make the whole process highly efficient and secure and less time-consuming for all concerned.
6. The social networks:
In the last 15 years, social media networks have grown from being mere tools of communications between individuals to multi-billion $ marketing platforms for brands. Today, all big or small brands engage with their existing as well as potential customers and venture into new markets by harnessing the power of social media. This evolution has also meant that these social media tools are increasingly becoming high-value brand promotion platforms linking accounting firms to their potential clients. Just like other modern era businesses, most of the accounting services companies are well aware of the critical importance of integrating conventional marketing practices into their business development activities.
However, there is still a lot of ignorance about the value offered by social media marketing. Many accounting firms don’t market themselves adequately on social media and have no long-term digital marketing strategies in place. However, modern-day accountants need to be attentive to their company’s social media presence and consistently include social media marketing into their business growth plans. An effective and constant social media visibility can further augment the company’s marketing efforts on other channels.
Now that we have established the criticality of account management software in the contemporary world of business, we need to find out which is the best account management software. It is easy to get confused and buy tools which claim to be the top account management software in the market, but prove to be of little help to you. Hence, before we delve into the various options available, it is important to understand one’s needs related to such account management software.
The Best Accounting Software for you
Each software comes with a great product brochure and features that claim to be groundbreaking, to say the least. However, is that the so-called ‘best online account management software’ even useful to you? Well, here are some tips that will help you identify the ideal accounting software for your company.
1. Know what you need:
Are you in need of a platform that has the option to track inventory, receipts and allows for direct calculation of sales tax etc? You must first create a detailed list of all the tasks that you want your accounting software to perform for you. They should further be categorized into ‘must have’ to ‘optional’ features. You must also be mindful of the volume, type of transactions and data that the software can handle. For instance, you might need a limited users’ software that performs certain key tasks. However, lack of proper research might lead you to buy an enterprise solution that is not only way more costly, but will be able to perform dozens of functions that you don’t need to deal with.
You must be very clear about the investment you wish to make on your accounting software. There are often solutions ranging from a few $ a month to hundreds of $$ a month, and you must focus only on buying products that fall within your budget. Budgets should always have a bit of shoulder room so that you don’t miss out on a perfect solution just because it cost a couple of $ extra every month. However, the ground rule usually is to walk away if the product is going to cost you more than 25% over the amount that you planned to spend.
3. No Fancy Features:
When you talk to a sales representative or go through a brochure, it is quite likely that you will be swept off your feet by the features offered by a software. However, if you conduct a thorough evaluation of your needs and expectations, you are likely to discover that you won’t need most of the fancy features. For instance, there might be a software that provides seamless integration for global teams and clients in over 100 countries, but your business is centred only in Bangalore or Delhi or Dubai. So, purchasing such a solution would lead to spending on features you don’t even need. You must not get carried away by such glitter. Focus only on features you need on priority and contemplate buying accounting software that takes care of these needs.
4. Probe Correctly:
Sales representatives are really good at convincing you that their product is the only thing that you need. However, you need to go beyond being a starry-eyed customer and ask the right questions that ensure you get exactly what you need. Here are some of the things that you must find out before swiping your card.
- What kind of security is offered by your API?
- How can I back up my system data?
- Apart from the subscription charges, what other costs or additional purchases would be there?
- What kind of multi-channel customer support do you provide?
- Are their hours fixed or do I get round-the-clock support?
- How long does it take from raising a ticket to get the issue resolved?
- Do you have other clients similar to me? What pain points they had and how did you address them?
- Would I be able to import existing data from Excel or Tally?
Buy for present, not for the future
There is no software that can’t be upgraded, or its subscription plan changed. If you need a software capable of handling X tasks at present, then go for one that offers such capability. Your business might grow to 10x in the future, but that doesn’t mean you need to buy 10x transactional capability at the outset. At the same time, nobody would want to be forced to upgrade within a few months of subscribing.
The best option is to calculate the rate of growth of your business, your marketing goals and make a realistic assessment of the growth your business is expected to witness in the next one year and buy the product accordingly. This will also be cost-effective for you as you will be able to upgrade if needed at the time of annual renewal without wasting any extra money.
Top Accounting Management Software Features Available in The Market
When we look around in the market, it is easy to find dozens of feature rich accounting programs all of which claim to be the best accounting software. Hence, apart from our considerations related to need as discussed above, we also need to look into the extent of technology we are comfortable with, and what all features do we need from an account management program.
The most prevalent and basic program used all over the world is Excel. However, it is not only extremely time consuming, but also lacks a number of functionalities desired by professional accountants. There are also the desktop variants of software that you can install on your computers, but they will be devoid of the flexibility, security and various other cloud facilities. Hence, let us get an in-depth look at the wide range of features which are offered by many advanced accounting programs available in the market.
In case your business is into retail and keeps an inventory of the products, an inventory tracking option will prove to be highly beneficial for you. There are advanced accounting software that raise alert as the stock depletes and let you know if there is a need to place an order for more stock.
Sales Data Generation:
Sales tracking option generates invaluable data related to your gross income and profits. Further, it keeps track of each product sold to inform you which products sell best and when. For instance, let’s assume you run a restaurant. Won’t it make a greater impact if you have data that tells you which dishes sell best at lunch and which are more preferred by diners? It will surely make you customize your menu, save costs and also better maintain staffing levels.
As a business, you will have a wide range of contacts including buyers, suppliers, channel partners, service partners, employees and regular customers. All these people play important roles in boosting your sales. Hence, through automated contact management, you can send people push notifications, invoices, purchase orders, payrolls and sales promotion emails.
A good accounting software can crunch your numbers from the last month, quarter or year as desired by you. It will help you prepare a near accurate forecast of the future budget. You can generate custom reports related to sales data, profits, losses, investments, staff costs or operational expenditure. All these reports will help you sail smoothly on the financial front in the year ahead.
Preparation of client estimates becomes much easier by using a cloud accounting software. For instance, you might be an interior designer surveying a 3 storey 6 bedroom property spread over 4 acres and you need to prepare an itemized estimate for the client. You can simply use the cloud accounting software to prepare the same on your laptop or tablet computer. You can show the estimate to the customer on your device screen and send a copy of the same to them via email. Advanced programs have the feature of converting an estimate into an invoice upon the work’s completion.
Programs that offer integrated payroll feature usually provide the option to convert employee timesheets into paychecks. You can proceed to make payments using direct deposit or a similar activity depending on your standard process of paying the employees.
Cloud-based accounting software such as Giddh provide you the facility of calculating and collecting the correct amount of sales tax from your customers. It reduces errors and helps you avoid penalties for not depositing right tax amount. A good accounting software will also help you in income tax calculations and make it easier for you to file taxes on time with GST compliance.
The cost of human resources is one of the key expenditures of your business. Using the time tracking feature, you can accurately calculate labor costs or billable time and send the invoice/report to clients, especially if you’re a mechanic, doctor, lawyer, accounting firm or any other professional service provider.
Cloud accounting has a really good feature in receipt scanning. All you need to do is to click the photo of a receipt using a smartphone and upload it to your cloud software which will file it in expense ledger. Thus, it streamlines the process of receipt management and makes it much faster.
Your bank account gets integrated with your accounting program, and such a program will also be able to pay your bills. You can set up auto-payments for things like rent, utilities payment, and supplies. Payment alerts are sent to your phone and necessary updates are made to your financial books automatically.
Courtesy of the highly secure connections and seamless integration, your accounting software takes care of your bank transactions and can independently transfer funds received to your bank account on a real-time basis.
If you are a business owner who is frequently on the move or you have employees who work remotely, a mobile accounting app can be a godsend. Most of the modern accounting software programs offer integrated mobile apps. We have talked about only the most prevalent features of accounting software, but, there are plenty of other customized and program specific features that you are likely to discover. Based on the tips and information shared here, you can choose the ideal account management software for your business.
As is evident, technology and account management software tools have become an integral part of the modern accountant’s life. What is essential is to understand the various available techniques, the needs of your business organization and to select the ideal tool. In case you are an accountant who is already not well-accustomed to accounting software and tools, then the time is ripe now. There is a plethora of highly efficient, affordable and easy to use tools for you to take the first steps towards becoming the 21st-century digital accounting expert and business advisor.