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Accounting with Computers

       Accounts and Bookkeeping


Date Published: March 2001

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Accounts and machines
We all know that computers love numbers right? They can can go through them without even thinking! So why doesn everybody use a computer to help with their accounts?

The truth of the matter is that many people believe that accounting software will be too difficult to learn; if its difficult to learn a business accounts software package, wouldn it be better just to stick with the way you e currently working?

OF COURSE NOT!

You e probably either currently spending either your own time on sorting out your accounts, or paying an accountant to do it all for you. Running a simple to use business management software package which includes accounting software would save you both time and money.

Statutory Obligations
All businesses have certain statutory obligations they have to fulfil. If you run a business you need to be able to provide invoices to all of your customers. If your business has any expenses you need to keep a record of how much your business costs to run - and what business doesn have expenses? Its well recognised that a business generally has more ways of spending money than acquiring it! If you e a VAT registered business you have to submit a VAT return every quarter.

Time saving
These tasks in themselves can be incredibly time consuming, and none of it makes you any more money. All the time that is spent completing them is time not spent on the actual running of your business. Accounting software that can help you to cut down that amount of time spent on these tasks is therefore an essential part of your business management software.

In addition to providing facilities to be able to store and retrieve financial information both quickly and easily, Accounts software can also allow you to view the information in different ways at the click of a button; this information can give you an invaluble insight into how efficiently your business is running, if there are cash flow problems around the corner, where expenses could be cut etc.

Flexibility
Small Business Accounts Software should have the flexibility to enable a business to complete their statutory obligations quickly and without fuss, and to use more in-depth facilities as and when they become required

Sales Day Book
Central to any Business Accounts package is the Sales Day Book. Sound scary? It shouldn do. The Sales Day Book is just a list of the invoices that you have raised, when they were raised and how much they were for. So if you view your Sales Day Book for the month of June for a given year, for example, you can see how much money you have invoiced for. Simple!

So how is the Sales Day Book information created? Well in a good accounting software package all you should have to do is create an invoice for someone, and thats it! The software should then create all the other necessary information and look after it all, so that you can get straight back on with running your business. Even small business accounting software should provide these facilities.

Whats the Sales Ledger?
The Sales Ledger information is the same information that is in the Sales Day Book, except that it is split by customer. This enables you to easily see for any given client how many invoices you have raised, and how much is outstanding for payment. The Sales Ledger will often only show information relating to invoices that have not yet been paid.

Payments and Debt Chasing
Accounts software should build on the Sales information, enabling you to enter payments against invoices when they are received, provide you with Invoices that are late being paid, and send Statements of outstanding invoices to late paying customers.

Debt chasing is of fundamental importance to any business. Its no good being busy and invoicing loads of customers if you e not getting your money from them. Bad cash flow is the cause of so many business failures, but with good business accounts software it is totally avoidable if the bad cashflow is a result of bad debt collection.

Expenses
If the Sales Ledger looks after payments coming in to your business, then the Purchase Ledger looks after the money going out. You need to keep a record of your business expenses for tax reasons, but there are other reasons for keeping this information in a business accounts software package. Once information has been entered into the Purchase Ledger (simply a list of your purchases with the date and amount) then you can gain a valuable insight into where your business is spending money.

If one particular area is swallowing up a high percentage of your businesss money, then maybe you need to change supplier. Or perhaps the running of that area of your business needs to be more efficient. Important changes can be made to a business through the information that an accountancy package can provide - and these could well be the changes that ensure the continued success of your business.

VAT Returns
With both income and expense information in your accounts package, the production of your quarterly VAT Return becomes a two minute job, rather than days spend going through receipts and paperwork. Your statutory obligations suddenly become a small task rather than a major headache.

If you have an accountant (and using a business accounts package doesn mean that you don need an acountant), you should be able to provide them with all of your accounting information, so that they can perform their tasks without having to go through all paperwork from scratch - and this should result in a reduction in their bill!!

Accounting software, particularly business accounts software, needn be difficult to learn and the benefits by far outweigh any learning that may need to be completed.

If you aren using accounting software GET SOME TODAY!

Payments and Debt Chasing
Accounts software should build on the Sales information, enabling you to enter payments against invoices when they are received, provide you with Invoices that are late being paid, and send Statements of outstanding invoices to late paying customers.

Debt chasing is of fundamental importance to any business. Its no good being busy and invoicing loads of customers if you e not getting your money from them. Bad cash flow is the cause of so many business failures, but with good business accounts software it is totally avoidable if the bad cashflow is a result of bad debt collection.

Expenses
If the Sales Ledger looks after payments coming in to your business, then the Purchase Ledger looks after the money going out. You need to keep a record of your business expenses for tax reasons, but there are other reasons for keeping this information in a business accounts software package. Once information has been entered into the Purchase Ledger (simply a list of your purchases with the date and amount) then you can gain a valuable insight into where your business is spending money.

If one particular area is swallowing up a high percentage of your businesss money, then maybe you need to change supplier. Or perhaps the running of that area of your business needs to be more efficient. Important changes can be made to a business through the information that an accountancy package can provide - and these could well be the changes that ensure the continued success of your business.

VAT Returns
With both income and expense information in your accounts package, the production of your quarterly VAT Return becomes a two minute job, rather than days spend going through receipts and paperwork. Your statutory obligations suddenly become a small task rather than a major headache.

If you have an accountant (and using a business accounts package doesn mean that you don need an acountant), you should be able to provide them with all of your accounting information, so that they can perform their tasks without having to go through all paperwork from scratch - and this should result in a reduction in their bill!!

Accounting software, particularly business accounts software, needn be difficult to learn and the benefits by far outweigh any learning that may need to be completed.

If you aren using accounting software GET SOME TODAY!


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Comments

Posted by Bee
On Friday 6th of March 2015 04:10:30 PM

"needn be difficult to learn and the benefits by far outweigh any learning that may need to be completed."

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