Computerised Accounting Systems – Desirable or Essential?
HMRC are currently pushing forward on the need to have digital accounting systems. Is this a further drain on businesses already constrained time?
There are several benefits for a business:
- Up to date Management information to inform you on how your business is performing
- Time saving as automated processes will enable ease of invoicing, statements, vat returns etc
- Computerised accounting systems are capable of recording a large number of transactions with speed and accuracy
- Reduction in paperwork – save back ups to physical devices or to the cloud
- Manage your cash flow
- Flexible reporting – computerised accounting systems capable of generating numerous reports
- Moveable office- access accounting system from home or work
- Adapts to current and future needs of the business
Yes there is the cost and time factor of purchasing a system and then setting all up on it- but this is frequently a one off commitment and thereafter the monthly fee for the system should recover in terms of less clerical time .
What other disadvantages are there?
- The need for IT skills and training on the system
- Power failure affects ability to work and can cause data loss if not backed up
- Computers are prone to viruses- need to invest in anti virus software
- Need for a printer or scanner
- Need to regularly back up
- Need good security in system so only authorised users can access
How do you know which software is good fit for your business?
There are many computerised accounting systems on the market. Two of the most common are XERO and SAGE- they operate on a very similar basis. All accounting systems need a basic amount of data inputted. Some systems operate on a scan and capture basis.
If a business wants to be successful it needs to be able to capture, analyse and use data correctly. Invoice scanning is a computer program that can extract invoice information into editable format. However it is very limited in terms of automation. It might identify the key fields in the invoice but you will need to transfer it to your accounting system. There are many systems available for example Quick books, DEXT, etc. Integrated accounting systems enable you to keep track of your invoices, accounts and expenses from your computer tablet or mobile phone.
Modern business accounting software is simple and straightforward to use and designed for people who are not accountants.
You need to assess what your needs are from any accounting software- will you be inputting the data or have you someone who will do this?
Getting the right software that works for you and your business is essential – speak with your accountant, they understand the intricacies of your accounts but you will know best what system you will be able to work with. Simple is often the best!
Corrigan CA Limited established in 1990 offers a range of services from:
- advice on Accounting systems
- vat and tax returns
- payroll processing
- accounts preparation
- capital gains and inheritance tax
- audits and independent examinations
They work with individuals and business from all walks of life from business start ups to business exit plans.