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Accounting has undergone a seismic shift in recent years. Before the advent of online cloud-based accounting software solutions, small and medium-sized businesses typically employed a bookkeeper to maintain the accounts and handed off the end-of-year stuff to an accountant. Not many business owners had the skill required to create a double-entry bookkeeping ledger, and although it was possible to use spreadsheets, they then had the problem of transferring that data to their accountant and tax authority.
Online accounting software has been a real game-changer. SMEs can now manage their own accounts while transmitting the data to their accountant digitally. Many accounting packages are also let you transmit tax returns directly, rather than via a third-party. Not only does this save time and money, but it also ensures a clear audit trail.
Unfortunately, however, not all accounting software solutions are equal. While you might have started with a small, cheap option, there will likely come a time when you need to upgrade to a more robust package. In this article, we’re going to go through the reasons why it’s worth considering switching to a new accounting solution.
You Can’t Fathom How It Works
Any software is only as good as the operator, so if the person maintaining your accounts can’t make head or tail of how the system works, it’s really not worth using it. Some systems are more complicated than others. Some need a fair amount of training, even if the person has experience in bookkeeping. However, if the package you are currently using is really opaque and there is very little help available, you really need to switch to a new solution. There are lots of accounting software tools on the market with FreshBooks and QuickBooks being two of the most popular accounting software options available.
It’s Not Cloud-Based
Cloud-based accounting solutions are so much easier to use than desktop packages. For one thing, anyone can update the accounts, regardless of whether they work from home or go into the office – which is handy in the time of Corona. In addition, data is stored in the cloud, so it won’t be a massive catastrophe if a computer hard-drive or local server crashes one afternoon.
Using cloud-based software lets you run your business on the go. If you are traveling for client meetings, you can update the sales ledger, check who owes what and add a purchase invoice for supplies you pick up. This saves a lot of time and effort and ensures customer service is up to scratch.
It Doesn’t Offer the Features You Need
Why stick with an accounting package that doesn’t offer you the features you need?
For example, if your accountant is using one software while you are stuck with another, there will be time and money spent transferring data from one to the other. And given how much accountants charge these days, can you really afford to pay the extra?
Look for a software solution that offers everything you need.
- Do you want to generate monthly reports for your fellow directors? Look for software that comes with that functionality.
- Are you happier paying monthly, so you can scale up if necessary? Look for software that is flexible.
- Does the software have a useful Wiki where you can look for help? If not, it’s time to upgrade to one that does.
It Doesn’t Integrate With Other Business Systems
Life is much easier when you can integrate your accounting software with other front-end applications, such as customer management software. Imagine how much easier it will be if your sales team can access a customer’s account in the event of a query, so they can see at a glance which invoices have been paid. Maintaining accurate records ensures fewer mistakes are made, which in turn keeps customers happy. And as any savvy businessperson knows, happy customers = a successful business.
You Can’t Customize the Software
Being able to customize your accounting software is very useful. For example, if you deal with overseas customers, it’s handy if you can generate invoices that automatically account for different rates of VAT and currency conversion anomalies. Look for a software solution that you can customize according to your business model. If the solution you currently use is inflexible in that regard, it’s time to upgrade to one that can.
It’s Not Compliant
For obvious reasons, any accounting software you use must comply with current financial and tax laws and regulations. If your package isn’t automatically updated each time something changes, you could end up being caught out by a change in the law.Before you switch to a new accounting solution, check how easy it is to transfer your data. That will have a bearing on whether you want to switch now or later.