Small Business Accounting Software
Checklist for Purchasing a Bookkeeping Management System
When looking to purchase software for a small business management system, it’s best to have a comprehensive checklist for the accounting needs of the business. Using a checklist will enable the entrepreneur to find the best system for their business and eliminate those that don’t meet their needs. It’s also important to have a system that is user friendly and easy to use. Accounting software that’s user friendly should be the first item on the checklist.
Business Accounting Software and Invoicing
Small business accounting software should always start with invoicing. The management system should be able to perform the majority of bookkeeping functions when invoices are created. When an invoice is created, the system should be able to automatically post to all appropriate journals at the end of the business day.
Examples of Automatic Journal Postings
- Sales
- Cash
- Accounts Receivables
- Inventory
- Cost-of-Sales
- Freight
- Sales Tax
Business Management Systems and Inventory Control
Depending on the type of small business, a good management system should be able to keep track of product inventory. In a service related business the system should be able to track service charges or labor sales. Since it all starts with invoicing the product should be automatically deducted from inventory by part number or product code when an invoice is created. Some other considerations for inventory control by product code or part number may include:
- Automatic deduction from perpetual inventory
- At least 12 months of sales history by month
- Bin locations
- Create stock orders with stocking levels and reorder points
- Track special orders
- Post receipts
- Ability to perform physical inventory counts
- Product fields like pricing, descriptions etc…
Business Accounting Software and General Ledgers
Management system software should have good general ledger flexibility. It should allow the entrepreneur to create general ledgers as needed for easier analyses of financial statements. The system should automatically post from the journals to the general ledgers and then on to the financial statements.
Accounting Software and Payroll Considerations
Many businesses use a separate service for payroll. Incorporating payroll into a small business management system can result in some savings versus the expense of a payroll service. If payroll is incorporated into the bookkeeping software, make sure that all payroll transactions automatically transfer to the general ledgers. The payroll software should be able to automatically figure various payroll tax deductions as well.
Some of these recommendations for a checklist are generalities. There may be other considerations that may be unique to a particular business. One of the most important aspects of a business accounting software system is to find an all-encompassing comprehensive system. Look for a system with a minimal amount of human interaction that allows password security protection by function.
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