Keeping things simple may well be the key to surviving or growing a business in a tough economic climate. The current recession seems to be planning on staying with us and although that may not be what everybody would like to hear, a recession can be a time in which SMEs and start-ups can find excellent opportunities. Simplicity is about keeping costs down and working efficiently and one key tool that any new or small business needs to hand is suitable accounting software. Keeping your own accounts may seem straightforward, especially at first, but it can be time consuming and will become more complex as your business grows. Suitable accounting software and a good accountant will minimise the time you need to spend on financial matters and free up time to get on with the ‘day job’. For new businesses and those starting out as self-employed here are key aspects to consider when choosing your first accounting software package.
- Simple bookkeeping. The simplest function you’ll need is to track sales and purchases. This can be done without an accounting software package but packages help to avoid oversights and errors which can crop as time goes by. With simple straightforward fields to fill in and calculations pre-set small mistakes that have a big impact can be quickly solved if they do occur.
- Invoicing software. Whichever accounts package you choose it will need to be capable of producing invoices. There are two advantages apart from the obvious here. Firstly it will add a professional touch to these important communications with your clients and secondly professionally produced invoices look better if they’re needed when applying for business funding, grants and loans.
- Payroll functions are crucial if you have or are likely to have employees. PAYE calculations and NI contributions that can be managed on a monthly or weekly basis by an automated system will make life very straightforward indeed.
- VAT calculation functions are important if you are VAT registered. Systems that calculate figures for VAT at the end of VAT periods and keep a record of VAT on an on-going basis will take nearly all the effort out of this difficult area.
- Credit Control features can be important for some businesses. Systems that include this function should highlight when limits are reached and produce simple statements for you to send on to customers.
Small businesses and sole traders may not have the expertise in all areas of accounting – if any. Using an accounting software package that is suitable to your business needs will ensure that records are kept as required by the law and will save valuable time. Check when purchasing an accounting package that it is compatible with your accountants system. Many suppliers now offer both desktop and online software and the latter is becoming increasingly popular as it not only backs up important data but can be easily shared by your accountant using an internet browser. With a good flexible accounting software system you will find the time and cost savings a significant boost to your business, a boost that could make all the difference in the battle to stay ahead of your competitors.
Guest Post Author
Carlo blogs accounting and invoicing software and general small business matters, when he’s not online or cycling around town you can’t get him out of the kitchen for his love of food.