Online Accounting: An Invaluable Tool For Your Business
Technology just never stops. In recent years, there has been a growing trend towards online accounting in first world countries. It is now available locally but so far has been used mainly by technologically savvy people.
Online accounting offers considerable benefits particularly to Small and Medium Enterprises (SMEs) who can now get control of this important part of their business.
How does it work?
Online accounting software seamlessly integrates many of your daily routines into your accounting system. Consider a credit note – a clerk investigates a claim and once satisfied sends it to the sales manager to authorise. He can authorise it online, your customer is emailed the credit note and your accounting records – sales, stock and debtors – are automatically updated.
Let’s say the business owner is waiting for a flight at O.R. Tambo airport. With his laptop, he can run a month-to-date profit and loss report, see how the margin is holding up and run reports he has designed. For example, a sales person may be on a non-performance warning and the owner can design and run a report on this person’s sales to date. Instead of waiting three to four weeks for the accountant to run month end reports, they are now instantly available.
Why use online accounting?
- The quicker you get data, the quicker you can react. A debtor may be slow paying but finding out about this four weeks after month end could be the difference between collecting the money or writing off a bad debt.
- It’s relatively simple to use. Staff from owners to clerks can be quickly trained to use the system. This is empowering as you can effectively control this part of the business instead of being overly reliant on your in-house accountant.
- Online accounting is getting increasingly cost effective. In addition you will need less bookkeeping staff which can be a considerable saving.
- As your in-house accountant becomes less needed for run-of-the-mill functions, you can now get more expert advice on how to interpret your accounting data. You can also obtain strategic input such as should I outsource distribution, what is the real cost of my sales force etc.
Effectively, your business can move up to another level.
The online accounting landscape is starting to develop in South Africa and the people who get in early will have a competitive advantage.
Speak to your external accountant as to how you can investigate the benefits of online accounting.