When it comes to understanding how your business is performing and how it might perform in the future, the most important tools at your disposal are the numbers coming out of your accounting software.
Historically speaking though, getting the right numbers into your accounting software so you could output accurate reports was a painful process: enter all of your bank transactions; enter incoming and outgoing amounts, reconcile incoming and outgoing amounts with bank transactions. It took a lot of time and effort, and while getting a bookkeeper to do the work was a relatively simple solution, that led to delays in input and outputs… and left business owners making decisions with out-of-date financial information.
Enter cloud-based accounting software.
What are the advantages of cloud-based accounting software?
Many people think cloud-based accounting software is just software that you use online and stores your data in ‘the cloud’. But it has a lot of advantages that might not be immediately obvious:
- Bank transactions feed directly into your software and are automatically categorised.
- POS (Point of Sale) integration can allow your smartphone to act as an EFTPOS machine.
- PayPal and other online payment gateways can be integrated similarly to bank transaction feeds.
- Live profit and loss statements based on bank and payment gateway transactions.
- Connect your sales software directly to your accounting software.
- Access your financial data from any location or device.
- Invoice via email from any compatible device.
- Allow others (for example, your accountant) easy access to your books.
- Off-site backups.
- Keep an electronic copy of receipts with transaction records.
How can these advantages help my business?
So how do these myriad advantages actually help your business? For a start, they save time. Being able to automatically record bank transactions and reconcile them with invoices and sales receipts cuts out a lot of effort, as well as minimising human error. They also allow a business owner to make better decisions, because those decisions can be based upon up-to-date financial information and reports. And most importantly for some businesses on the move – they allow access to that information, as well as instant invoicing and payments, from a simple smartphone or tablet. You can imagine just how much of a boon this can be to mobile businesses.
Which cloud-based accounting software should I use?
The choice of cloud-based accounting software is a very individual one. It depends a lot on your business’s workflows, accounting needs, and integration requirements. Each of the major options available in Australia offer the same basic functionality, but different levels of extended functionality and plugins. It is, however, important to ensure that the software is actually designed for Australian businesses, and supports the SBR reports that you’ll need.
The most common options that we see Australian businesses using are (in alphabetical order):
All offer free trial periods, so you can play around with the software for a while and see how well it works for you. If you’d like to talk to our bookkeepers for more information or to look after these accounts for you call us on 07 5512 6106.