Running a startup business often means juggling all sorts of tasks. With limited resources, growing competition and an increase in market demand, startup owners are faced with multiple challenges making survival even more difficult. According to Investopedia, the failure rate of startup businesses has reached 90% in 2019 alone. 21.5% of them failed in the first year due to several factors such as running out of budget, lack of research, ineffective marketing and the biggest reason of them all, poor bookkeeping. With this, it has become paramount for each organisation to invest in reliable accounting software.
As your business grows, the needs of your company also change. The overall processes and operations become even more difficult. A successful business means more invoices, more financial statements and so on. To manage everything with ease, most businesses are now gearing toward the use of technology for their day-to-day operations. Gone are the days when sticking into the good old paper and pen strategy was the only way to carry out financial calculations. Thanks to technological advances, accounting software solutions now exist.
5 Advantages of Accounting Software for Startups
Businesses, regardless of size and industry, need to have accurate accounting. However, investing in accounting software is not always on top of most businesses’ priorities. It is only when it’s too late that they see clearly how valuable this system is.
To help you realise how important an accounting software solution is to your organisation, read on to find out more:
Access data anytime, anywhere
One of the biggest advantages of cloud accounting software is the ability to access data whenever and wherever you need and from whichever device you want. An accounting system lets you perform accounting-related tasks from your desktops, laptops, tablets and mobile devices. With a centralised database, you can easily manage inventory, payroll and other important financial aspects all in a single point.
With an accounting software solution, you can instantly view and download your company’s financial statements with just a few clicks. All you need is a device connected to the internet plus a browser or an app.
Back in the days, the only way to synchronise all financial data was by saving it on a USB drive then requiring everyone in the department to download it on their PC just so everyone could have the file’s most updated version. Sounds gruesome, isn’t it?
Fortunately, you can bid goodbyes to those memories and start anew with accounting software. This solution enables users to access the same data in real-time. Employees can easily do what they need to do, without getting in each other’s way. With an accounting system, businesses can improve collaboration, resulting in productivity and efficiency.
Compared to manual bookkeeping which can take a lot of your employees’ time and energy, accounting software enables users to get things done the fastest way possible. An accounting software solution gets rid of repetitive tasks such as creating invoices and journal entries, tracking transactions and sending late payment reminders.
An accounting system lets you automate journal entry creation by integrating your bank directly to the software. Once integrated, the accounting software will automatically create a journal entry as soon as you make or receive a payment. This saves a lot of time, allowing you to focus on activities and tasks that generate profits.
Data breaches are everywhere. Most of them are designed to target businesses, even small ones. Fortunately, accounting software ensures better security by having all your data stored on the cloud. Unlike desktop-based accounting software where data needs to be backed up regularly and stored in a hard drive, which can be easily destroyed or stolen, cloud-accounting software makes your data extra protected with layers of encryption algorithms. What’s more, accounting software allows you to give different access levels to different users depending on their privileges.
Manual bookkeeping increases the chances of errors and inaccuracies. While these issues can be solved if addressed immediately, some errors go unnoticed. Thus, resulting in bigger and more serious problems. With accounting software, you can avoid the most common accounting errors. Once a possible error has occurred, the system will immediately notify you even before you make the mistake such as clicking submit. Moreover, accounting systems help ensure that all accounting records are accurately organised. By looking at accurate data, your team can make decisions faster, resulting in greater productivity.