Accounting is a necessary evil when it comes to running a glazing business. It's a time-consuming task and it's an overhead — it must be done but it doesn't generate an income in itself. This is where great accounting software comes in — find the right solution and your day-to-day accounting tasks will be quick and manageable, making tax time a breeze.
For years, accounting software looked and functioned in a pretty stock standard way. It was downloaded to a PC, difficult to share between multiple users, and data was imported or exported manually via spreadsheets. Many of you may still be using a system like this and perhaps it works for you. But you're missing out on the powerful, time-saving features available in newer, cloud-based applications.
Xero was a game changer for accounting software. It's thanks to them that cloud-based accounting software is the new norm. Their revolutionary features included being able to login and run your business from anywhere, syncing with online banking to see your cash flow in real time, and being incredibly intuitive and easy to use, even for non-accountants. Nowadays you can even embed an online payment link into your invoices. Customers can click the link to pay online with their credit card. I think we will all agree that making it easier for people to pay you is a good idea.
The difference this kind of functionality makes in your business cannot be overstated. Being able to automatically reconcile payments as they come into your bank account with invoices you've sent out is incredibly handy. Rather than devoting blocks of time at the end of each month to reconciling bank statements, you can quickly run daily reconciliations and spend your time on revenue-generating work instead. When the time comes to file your business' taxes, your accounting data is already up to and you may be able to file directly from your accounting system. You won't spend hours looking through old invoices and receipts to figure out what came from where — you might even be able to throw out your filing cabinets!
Hot on Xero's heels is QuickBooks Online. QuickBooks is a larger and better known business, having provided desktop accounting software for years before developing a cloud offering. Many of the features they offer are similar to Xero — we're not going to compare the two, you can decide for yourself which solution works best for your business — but the competition between the two companies is good for us as consumers. After years of slow development, accounting software must now actively compete for customers which means a constantly improving product.
Here are a few areas where cloud accounting software can have the highest impact in your business:
- No more double entry. Entering the same data in multiple locations is unproductive and doubles the likelihood of a mistake being made. Both Xero and QuickBooks sync with other common applications you might use, making it easy to manage information.
- Use real-time data to make better decisions. If you're using month-old data, you could be missing crucial details that inform your decision making.
- Accounts information is available and accessible to the right people. If there's more than one person in your business who needs access to accounts, it makes sense to have a cloud-based system where access can be given at different levels. This is particularly helpful if you're the business owner but someone else manages the accounts on a day-to-day basis — rather than asking them for reports, you can get the information you need on your own.
- Work from anywhere. Cloud-based software is accessible wherever you have an internet connection. While no one wants to spend their weekends doing bookwork from home, having the ability to do so is reassuring.
- Take the stress out of taxes. Increasingly online accounting software like Xero and QuickBooks Online can calculate and file your payroll and sales tax returns for you, saving time and reducing mistakes. The combination of this and online access from anywhere means that small business owners are no longer shackled to their businesses, it is now quite feasible to take a longer holiday and file your business’ tax return from beside the pool.
We've already talked about the security benefits of using cloud software and the advantages of using Software-as-a-Service over Enterprise software. Don't let monthly fees put you off, you're getting a lot more bang for your buck on a subscription model.
Xero is making serious in-roads into the accounting software market and incumbents such as QuickBooks are increasingly pushing their online solutions over their desktop versions. The cloud accounting revolution is already well underway.