Accounting is a key aspect of any business, so it is important that it is done properly and efficiently. Utilising accounting software can greatly contribute to the process, streamlining your accounting operations so that you can spend more time focussing on other aspects of running your business. Here’s how accounting software can help you:
With traditional paper/manual Excel sheet accounting, each transaction must be entered by hand, often in multiple accounts. Everything must be handled meticulously to ensure that all entries are completed properly. Accounting software makes it easier to get the accounting done quickly. Many software applications automate everything for you, ensuring that each entry is allocated properly with minimal time and effort.
When errors occur in the accounting process, it is often a result of human error. Whether it is through entering data in the wrong column or account, or through mistakes in calculations, the human element greatly increases the risk of discrepancies in the books. With accounting software, you know that calculations will always be done correctly. With many accounting software applications, there are in-built checks that can alert you if a transaction may be entered incorrectly, helping to reduce errors even more.
When tax time comes around each year, many businesses scramble at the last minute to obtain the data they need to lodge their taxes properly. Any errors can result in fines or audits, putting added pressure on your business. Accounting software makes the tax lodging process easier by compiling all of the necessary data for you. In some cases, you can even complete your tax forms directly within the software, making things even easier and saving you a lot of headaches throughout the process.
Knowing exactly what is going on with your business’ finances is crucial to keeping it successful. Creating financial reports can take a lot of time when doing it by hand, which can take you away from the day-to-day aspects of running your company. Instead of taking the time to do this yourself, accounting software is capable of creating detailed reports for you automatically. In addition, the extensive reporting capabilities in most accounting software applications can give you access to data that you would have been unable to examine on your own due to the time involved in completing the calculations.
Forecasting capabilities are one of the most useful features in many accounting software applications. By analysing past data and trends, as well as your sales projections, accounting software can often generate predictions regarding the future cash flow of your organisation. This can be of great assistance in planning future courses of action for your company, such as when would be a good time to invest in an equipment upgrade for example.
As with creating financial reports, developing forecasts can be incredibly time-consuming when done by hand. Having this information at your fingertips, within the software application, can help you to make informed decisions about how to proceed.
Here at Horizon Business Systems, we are committed to providing market-leading accounting software to help businesses all across Australia. Our team of associates would be happy to discuss our products and services with you further to help you understand how we can help you take your business to the next level. Call us at 61 8 9328 1678 or get in touch with us online for more information. Your business’ success is our business, and we will work with you to help make it happen.
June 30 always seems to sneak up on us doesn’t it? There’s a lot involved in preparing your business documentation for the end of financial year.
The Australian Taxation Office will be expecting your return between July – October 31 2015, and employees will be expecting their payroll information ASAP. It’s not too late to get your business ready for tax time, even if you’ve done a poor job of record keeping so far.
1. MONITOR BANK TRANSACTIONS CLOSELY
According to a 2014 member survey from the Institute of Public Accountants and MYOB, 65% of business operators miscode bank statements. If most of your entries have already been made, it’s not too late to incorporate a software tool to help you catch errors. Accounting software should have built in controls to ensure that data is accounted for correctly, within an easy-to-use interface.
2. STAY ORGANISED AS YOU GO
According to the same research, it is estimated that 58% of business managers fail to keep up with their accounting and business statements on a regular basis throughout the year. One of the main reasons business people run into trouble is the fact that they are disorganised or simply don’t know where important records are.
This is where choosing the right business management and accounting software can really make a difference. Intuitive and user-friendly software (like MYOB Exo!), which can integrate the accounting function with other business management functions (like sales, stock, point-of-sale, payroll, field management etc.) means less work for you as these functions will communicate with one another and keep your accounts up-to-date.
3. EVALUATE GST LIABILITY
You may need to change your GST net liability for a reporting period. Business owners can increase or decrease adjustments, depending on their circumstances. MYOB Exo can help you evaluate your situation and ensure compliance.
4. PAY ATTENTION TO SUPERANNUATION
If you have to make superannuation payments for your staff, paying them in June will ensure that you can deduct them in this fiscal year. An advanced accounting software program can help you avoid exceeding your personal contribution caps.
5. RESPOND TO REQUEST FOR ADDITIONAL INFORMATION AS QUICKLY AS POSSIBLE
Around 49% of business owners fail to report or update information when it is asked for. Take care of any “loose ends” and tie things up as fast as you can.
6. CONSULT A PROFESSIONAL
If your paperwork is not quite ready to file, it’s still a wise decision to sit down with an accountant who can assist you with planning and strategy. If your records for this year are not up to date, business data from prior years can give your accounting professional a glimpse into your finances. Accounting software ensures that prior year records and returns are easily accessible at tax time.
7. GET THE BIG PICTURE
Don’t look at June 30th as tax time, look at it as a time to analyse your business, and your financial future. Enterprise accounting software will not only help you with last minute tax details, but it will give you a glimpse into other important details, such as insurance, investments, and retirement planning.
8. LEARN HOW YOUR ACCOUNTING SOFTWARE CAN MAKE THINGS EASIER
Smart business software keeps up with facts and figures that you might forget otherwise. No one can remember all of the facts necessary to keep up with the intricate accounting details of a busy office. However, 46% of business managers are not able to use the software they choose with a high level of functionality. This can defeat the purpose of having tax or accounting software in the first place!
At Horizon Business Systems we have MYOB EXO & MYOB Advanced Consultants, who can work closely with your team to deliver customised training and support.
Automated and fully supported ERP systems – such as MYOB Exo and MYOB Advanced – offer reporting and compliance functionality for business owners and managers to confidently make decisions and forecasts to ensure successful financial management and the ability to seize market opportunities.
Horizon Business Systems offers the perfect combination of expertise and service to ensure that your business is ready to handle tax season, every year!
When you first started out in business, how much of your day did you expect to spend hunting down customers or clients who owe you money? For some business owners, collecting unpaid money is often a huge time commitment every day. It makes many people feel like debt collecting is their main job rather than their actual business.
This is one of those less discussed aspects of business operations – but it’s an important one. After all, it’s your money for services rendered. You want to get that money in the bank.
What options do you have for reducing your debtor collection periods? Below, we’ve outlined a few solid steps to help your reduce these debtor collection periods. Check them out and see how they can work for you.
When it comes to debt collections, sometimes the best strategy is the most basic one. Try this example on for size: reduce the payment terms into two simple options. Tell your customers that the minimum payment due now is 50%. But if they offer to pay the full balance now, offer them a discount of somewhere between 3% and 5%.
The incentive here falls on your customer. If they can get away with only paying 50% now, why wouldn’t they choose this option? If you’re giving them an incentive for full payment now, however, they now have a much more compelling reason to pay the full balance. The small discount won’t hurt your bottom line too much. But it will definitely help you collect your money more quickly.
The main thing to remember when dealing with debtors is the critical importance of consistency. You need to stick to your repayment terms without swaying if you want them to work for you. Even one instance of letting a customer get away with a smaller deposit could balloon into confusing and ineffective repayment terms. Don’t sway on your terms and watch how your average debtor collection periods improve.
Average collection times can vary wildly based on the industry you serve. Of course, there’s always room to improve those timeframes or better ensure your customers’ 100% repayment. One smart and simple business tactic is to meet your customers right where payment is most convenient for them.
For instance, at the end of a successful sales pitch meeting you could use your mobile CRM system to raise an invoice on-the-spot for payment instead of a mailing the invoice when you get bck to the office. Similarly, new smartphone-based EFTPOS technology is making it even simpler to connect on the spot payments directly to your business accounts.
By rethinking of payment collection as a direct component to your sales process (rather than an afterthought), you’ll see a much better turnaround in customer payments.
Business management & accounting software solutions, like MYOB Exo, can automate a large portion of the debt collection process for you. That way, you’re not spending an inordinate amount of time trying to chase down payments from clients and customers.
MYOB Exo can help you keep track of your debtors, set reminders for you and even send out email notices or other notifications to your customers. It also enables you to link all accounting data, client information, client orders etc. so you can have a quick overview of the full situation for each client before a follow-up call.
You can save a lot of time on your end by automating these processes. And most of your customers will likely respond well to regular reminders – hopefully improving your collection periods to get your money faster.
Your accounting system effectively documents all the activity in your business and provides critical information to make good business decisions. If you’ve outgrown your accounting system and you’re moving to a new and improved model (like MYOB Exo!), it’s absolutely necessary that the transition is as seamless as possible so no information falls through the cracks.
To successfully transition to a new accounting system, you need to consider these factors:
CHANGE MANAGEMENT
A smooth transition starts with preparing your staff for change and guiding them through the process. First, communicate why your firm is moving to a new accounting software system. While the transition might require a lot of work on behalf of some key staff members, explain that your business will benefit from the new system in the long run.
Once you’ve explained why you’re making the transition, train your staff to implement the change. Schedule some time and verify that your current accounting procedures are documented. Work with your software provider to create a plan of conversion. Ensure that all stakeholders (accounting and finance staff, operations, senior management and even sales if your accounting system is linked to your inventory or job costing functions) are involved in planning the conversion.
UNDERSTANDING YOUR UNIQUE BUSINESS
Your company has processes that are unique to its particular industry. A retailer, for example, accounts for inventory. On the other hand, a manufacturer must account for raw materials and work in progress. You need to consider your unique business processes and how they link to your accounting structure in order to implement a smooth software conversion.
TEST YOUR NEW SYSTEM
Ideally you should have a transition period in order to test the new system is tracking data in the same way as the old system and avoid missing anything out. Run a set of transactions concurrently through your current and new system and review the results to ensure they are accurate.
Consider a denim jeans manufacturer for example. They decide to run transactions through their new system, at the same time, they process data through their existing (live) system. If their new software is operating properly, they should get the same accounting results as their current system produces. In this case, that means that the same dollar amount of denim is moved into production using both accounting systems. Both programs also post the same number of units, the same sales intake, same profit figure etc.
A FINAL SET OF TRANSACTIONS
Before you implement your new system, generate a set of adjusted financial statements at the end of a particular period. That “clean” set of financials will be your starting point for a new system. At the end of October, for example, you print a trial balance and post your accounting adjustments. Once you’re satisfied with your adjusted trial balance, you generate October financial statements (balance sheet, income statement, etc.).
GOING LIVE
Say you decide to go live with your new accounting software on November 1st. You’ve communicated the November conversion data to your staff. Each person in the organisation has provided his or her input on the implementation process. Your staff has a new operations manual and has trained on the new software.
At various points after software implementation, you analyse the results that are generated by the new software. You use your October 31st accounting data to ensure that November accounting activity is posted correctly.
These tips can help you have a smooth transition to your new accounting system.
WORK WITH AN EXPERT
Consider working with an accounting software expert to help you with the implementation process. We are available to talk through your particular situation with you and provide advice to help make your software switchover seamless. Contact us at (08) 9328 1678 or via our contact form and we’ll get in touch!
Too often we find businesses focus heavily on what their existing software does poorly but forget to review the good things.
For example your business has multiple stock locations and you have a need for this functionality as well as serial number tracking and barcoding. You find new software that does this well but later discover; after using it for several months, that it doesn’t allow for merging of stock codes, reversing transactions or changing codes. Your existing software did this very well, in fact, you took these features for granted and didn’t document them when assessing the new software program.
It’s important to list all of your business needs, in particular the quirky things you do, when you’re assessing new business software. Invite your entire team to put forward suggestions as to what would make their day easier, or more efficient. Ask them if they have a “wish list” of features, reports, processes that they would like the new software to achieve for them. Not only will you end up with the best program for your business, you’ll also find that your team will appreciate the change and be positive influencers in the critical first few months of using the new program.
Make a list and stick to it. Don’t be fooled by slick sales peoples banter, showing you features that look glossy but provide no intrinsic benefit to your business. If you have assessed a number of products and have ticks and crosses it will allow you to look at it objectively and make the right decision. Just as important as feature sets is the business partner behind the software, the people that install, train and support you. Make sure they’re local, have dedicated teams in consulting and support, and can provide you with good references. This can be the difference between a poor installation and a smooth one.
To find out more here’s a great article: Return on Investment
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