As an entrepreneur, it is very important for you to keep track of your money inflow and outflow. You need to be able to analyze your business’s financial health from different aspects.
Your analysis is only as good as the quality of your data input. It is critical to get started with the right accounting software to accomplish your daily accounting tasks.
With so many different service providers out there, the selection of the right accounting software can be a bit daunting. Preferably, you will want to get it right the first time to avoid wasting time shifting to another system some time down the road.
Here are some things to keep in mind when you are selecting the right accounting software for your business.
Online versus Offline
Many of the popular accounting software in the market today are cloud-based. There is nothing to install and the service provider takes care of the backup, upgrades, and maintenance. The best part is wherever you are, as long as there is internet connectivity, you will be able to access your accounts.
The drawback will potentially be the monthly subscription you have to keep paying and the fees tend to scale with the number of transactions or features you require. And for some businesses where you do not have a good internet connection, it might be a better idea to go with an offline software solution.
Understand your business accounting workflow and list down the features you require. For example, you may require things like payroll, multicurrency support or doing bank reconciliation by uploading your bank transactions.
Some accounting software providers like Xero has payroll functions that are in compliant with the reporting requirements of Singapore.
It will be best if the features you need are already listed in the basic package without having to pay more.
Continuing on from the previous point, you should choose an accounting service that allows for upgrading when your business operations expand in the future. It will be a mistake to get software that suits your business needs currently but not able to cope when your business grows.
Some software also parties with 3rd party software developers to make add-on modules for extra functions. That would be a good option to have.
Ease Of Use
The software defeats it’s the purpose if you and your staffs have a huge learning curve. Most owners do not have an accounting background and even so, the software must be easy to learn. Investment in training is a cost that should be avoided.
Also, do check on the ability to add users to the accounts. Some accounting software service providers place a limit on the number of users per subscription.
Most accounting software will come with free trials so make full use of it and get familiar.
Ease of Exit
Should you one day plan to change accounting software or to close down the business, you ought to be able to export your ledger for safekeeping. To save yourself from such situations, ensure that the accounting software provides data export facility.
You will not get it right the first time. Along the way, there will be instances you will require clarification or assistance with technical issues. Check out reviews or forums from existing users to see if the after-sales support is good. Or else your entire investment and time spent setting up the system will go to waste.
Talk To Your Accountant
More often than not, small business owners like yourself will outsource the accounting work while focusing on the other aspects of the business. Experienced accountants should be able to give you proper advice on some of the accounting software that is preferred. The pros and cons of each software.
When in doubt, seek legal advice or consult an experienced ACRA Filing Agent.
The editorial team at Acra Filing Agent
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