|Small business accounting software can save you countless hours by maintaining bookkeeping, eliminating manual calculation errors, and providing one click automated reporting capabilities.|
Small business accounting software makes the process of maintaining the books much simpler and more efficient, while providing business owners with one-click business reports during the year. Below are the top five reasons why accounting software for small business should be considered for your business.
Top Five Reasons to Use Small Business Accounting Software
1). Accounting software for small business provides timely and accurate accounting information at the click of a button.
The ability to quickly produce reports to track inventory, monitor expenses, analyze your business, pay tax liabilities timely, and review the overall performance of your business makes business accounting software a necessity. This is even truer today as small business accounting software has become extremely versatile for your industry, easier to use, and more powerful and cost-effective than ever.
2). Small Business Accounting Software Simplifies Bookkeeping.
Your financial statements, tax returns, and business analysis tools are only as good as the information used to create them. Inaccurate bookkeeping creates inaccurate financial reports that can result in tax penalties, unexpected cash flow problems, and inaccurate business information that is used to measure business profitability. Accounting software for small business quickly compiles accounting information to provide business owners with financial information required to make better decisions and monitor business performance.
Business owners often avoid the time consuming and laborious task of maintaining the books, but accounting software for small business simplifies the process greatly. Entering accounting transactions each day is worth the benefits of one click reporting, real time business reports, and no longer playing catch-up from gathering data for year-end tax reporting and financial reporting.
Business Accounting Software and Maintaining Tax Records
|The IRS requires tax deductions to be substantiated with receipts, schedules, and other source documents. Business tax software makes the process of filing tax returns much simpler, but you still must take the time to set aside files for your business expenses. After you enter your business expenses into business tax software, file the receipts into your business expense files to validate the expenses.|
3). Small Business Accounting Software maintains tax records and simplifies tax reporting.
Software programs allow you to receive the latest tax rates for payroll taxes and sales taxes, while simplifying the tax filing process by automatically filling in tax forms for various jurisdictions with correct tax rates and amounts due. Several accounting software packages allow you to simply print the form, sign, and pay your taxes. It may be helpful to have a system accountant set up the software correctly before you begin entering transactions and updating tax rates. When your accounts are set up correctly, you can update tax rates in a few simple steps. Software vendors can help you set up the software for your business for an extra fee.
You may choose to outsource your payroll altogether so that you do not have to pay your employees or taxes directly. Many small business accounting software vendors offer full service payroll and payroll tax filing options. These options are highly recommended for businesses with a large amount of employees in multiple tax jurisdictions to prevent costly tax filing penalties, or if you just want a hands off approach to paying taxes timely.
4). Small Business Accounting Software prevents calculation mistakes.
Manual bookkeeping systems or computerized spreadsheet systems are susceptible to manual entry errors and miscalculations since the transactions are not properly set up to maintain double entry bookkeeping.
Small business accounting software packages calculate totals for general ledger accounts, trial balances, and financial statements, eliminating posting errors. Accounting software packages flag accounting entries that do not balance with the accounting equation before they are entered into the accounting journal, preventing posting errors and time-consuming mistakes due to data entry errors.
Of course, mistakes are inevitable and can still be entered into an incorrect account. A bookkeeper can still enter an insurance expense as an interest expense. Accounting software packages include safeguards to prevent these errors that include associating vendors with specific expense categories. Business accounting software also makes finding mistakes easier with powerful search features that comb through accounts and amounts entered to find data entry errors.
Accounting software for small business eliminates the most common mistakes of entering amounts that do not balance, posing errors, and summing accounts totals in preparation of issuing the financial statements.
5). Small Business Accounting Software Provides Comprehensive Accounting Solutions
Modern accounting software packages now have the ability to maintain various modules of business transactions, such as payroll, accounts receivable, accounts payable, inventory management, fixed assets, and tax management. These business accounting modules provide business owners with the ability to enter the data into one system and quickly retrieve specialized reports. Do you need to know which customers owe you the most money in your accounts receivable? Simply view, sort, or filter a listing of customers from accounts receivable reporting. You can view everything from which products are top sellers, to which bills are coming due.
You can also link your bank accounts with the software to download the latest transactions, and transfer data to your accountant to prepare tax returns, conduct audits, or manage your financial records.
Many business accounting software features offer enhanced capabilities that allow you to produce virtually any type of report and even download the latest tax sales or payroll tax rates for a given jurisdiction to greatly simplify tax reporting and compliance. Depending on your business needs, you can print, sign, and file the tax forms and pay them yourself, provide this information to you accountant, or choose full service filing options offered with the best software accounting packages.
If you have your accountant review and file the tax information, you can also negotiate lower rates for well-kept records and low maintenance tax filing.