Managing the finances of a growing company inevitably becomes more difficult over time. Business owners have to stay on top of the increasing number of orders, customers, workers, and expenses, all the while leading the company in a direction that matches its goals. Fortunately, companies today have access to highly functional accounting tools that can help them oversee the influx of data that comes with the company’s growth.
One of these tools is a computerized accounting system (CAS). As its name suggests, a CAS is an information technology solution that helps companies organize and take charge of their accounting needs. The CAS digitally keeps track of the flow of money that comes in and out of the company, which gives its leaders and other stakeholders a deeper understanding of the business’s overall financial situation.
Accounting systems come in all shapes and sizes–with some more complex than others. However, well-developed accounting programs have a set of features that further affirms how integral they are to the success of any enterprise. While small and medium-sized businesses are not required to get a BIR accredited accounting system, effective accounting programs all display the following characteristics. To elaborate, here are some of the main features that accounting systems offer.
Integration of Various Accounting Functions
Accounting is a multifaceted field. Accountants need to keep track of receivables, invoices, payables, payroll, and tax regulations, among many other components. What CAS implementation accomplishes is consolidating all these different accounting elements and organizing them onto a single platform, where accountants and company management can easily access them whenever they’re needed.
Some of the core features of accounting that a CAS improves include:
- Tracking accounts payables
- Managing accounts receivables
- Processing payments and transactions
- Calculating salaries and payroll
- Linking to bank accounts for more accurate reports
Other companies can also make use of a CAS with more complex functions, including printing shipping labels, inventory management, and staying on top of customer service.
Automation, Accuracy, and Speed
There are several repetitive tasks in accounting, including data entry and calculations. Traditionally, accountants had to repeatedly write down numbers and information in different ledgers and books and ensure that the numbers match. However, this method is not only time-consuming, but also prone to error, which can trickle down to reports and affect company decision-making.
With a CAS, many of these repetitive tasks become automated. Accountants or other authorized employees only need to enter the data once through manual entry or barcode technology. The info is then stored in a centralized database, where other departments of the company can access it as needed. For example, when completing a sales order, a sales associate can input the order, and the inventory team can access the order info to have the items quickly shipped upon verification.
Aside from the speedy processing of data, the company can also feel reassured that the information in the database is reliable. After cutting down the need for repeated manual re-entries, the information stored comes from a firsthand source. The system can also detect who entered the data, making it easier to rectify any mistakes whenever they arise.
Reports and Analysis
Nowadays, accounting is no longer about tracking numbers alone. Analyzing the numbers and generating reports is essential to company management because these items offer them insight into what works and what doesn’t. By doing so, they can chart a course of action that addresses any pain points and further develop successful endeavors. They can also have a clearer idea of the company’s finances and its standing in the industry.
Additionally, accounting analysis and reports help departments determine several other things including:
- Items that have to be restocked before they run out
- In-season products that did well could be ordered again next time
- A profit margin goal that best suits the company’s budget
- Performance rates, which can take into account productivity and employee morale
Consistency and Accessibility
Accounting is all about data management, and consistency is a crucial part of that. It must be present in how info is stored, which includes file names and labels, print templates, and other relevant information. This method not only makes data storage more organized, but also easier to access. People don’t have to rummage through multiple documents and files just to find the information they need. They can simply use the CAS and its labeling system to sift through the information and quickly locate the data that they are looking for.
Increased Visibility and Control Over Finances
When a business is small, it’s easy to oversee everything from the production of goods to the employment of new workers. However, as it grows, more factors come into play, and it becomes harder to stay on top of the many new elements that make up an enterprise. Implementing an accounting system can help owners regain some of that control by tracking all these moving parts and increasing company-wide visibility.
Indeed, a CAS comes with several features and many accompanying advantages. Deploying a new accounting system also comes with challenges, but it is often wiser to implement a compatible CAS sooner rather than later. For more guidance on this topic, make sure to look for a trustworthy solutions provider who can offer more insight on which accounting system to use for the company.