Accounting Tips

How to Decide Between Different Accounting Solutions

Whether you’re just starting out, or you have an established business, you make choices every day for the growth of your business.  Each choice affects your success.  One decision that is very important, is how you will manage your financial records.  There are several key considerations when you make your choice.

An effective system for accounting is critical to your company’s health.  The right accounting solution helps

reduce errors, gain insight into your finances, track progress, and create a budget.  Accurate tracking of financial data is critical, not only for day-to-day operations, but also for seeking funding from lenders or investors to take your business to the next level.

Which solutions is right for me?

Before you make your selection, you need to look at all your options.  Then you can narrow down your choices by understanding your needs.

So, let’s look at some of those options.

Accounting by hand – With this method, you’ll spend a good amount of time recording and computing figures.  There is also a significant risk of inaccurate records.  But, it is the least expensive solution.

Hire an accountant – You could hire an accountant to handle your recordkeeping, either in-house or by outsourcing.  While you wouldn’t have to worry about your books, you do lose a measure of control over your financial records.  This is a more expensive accounting solution.

Use accounting software – With accounting software, you enter your business transactions into the program.  The software computes the figures for you.  There are plenty of low-cost software programs that guarantee accuracy.  You maintain control over your recordkeeping. 

Cloud accounting software stores information online.  You can access your accounting from anywhere with an internet connection.  Even if your computer crashes, you can access your accounting records from another device.

Which software should I use?

Understanding your needs and budget will help you determine the right software solution for your business.  Here are four things to consider before buying accounting software.

1. Necessary functions 

What do you need your software to do?  Depending on your type of business, you may need industry-specific functions.  For example, if you pay vendors often, you’ll want software that lets you pay vendors.  Determine what certain tasks you need your software to accomplish. 

2.  Cost

The cost of accounting software varies, but you can find programs for a low price.  Usually the cost is determined by the features provided.  Packages get more expensive the more features you add.  So, knowing what you need can help you keep the cost to a minimum.

Make sure you look at all costs involved.  Ask about fees for updates, customer support, and setup.  Find out about any hidden fees that might be included in the cost.  If you are required to sign a contract, make sure you know the length of the contract before agreeing to it.  Ask the software provider if there is a fee for early termination.

3.  Accessibility

Some companies require more flexible accounting solutions.  If your business has several locations, you might need to access your software from each of those locations.  If you work with a partner or an accountant, accessibility might be important for sharing records.  You can access accounting information from different devices with cloud software.

Online software is convenient for business owners who are on-the-go throughout the day.  If you complete administrative duties at home, you might want cloud accounting software.

4.  Knowledge required

You will need to be able to learn how to use the accounting software.  Find out how steep the learning curve is for the software before you make your purchase.  Some software requires accounting knowledge to setup and use the program.  If you don’t know how to use the software, you might need to pay for and attend classes.  Some accounting programs are easy to navigate.  With a little accounting knowledge, you can learn to use the software.

If you’re looking for the right accounting solution, Pricewise Business Solutions can help.  We have plans that accommodate all levels of business owner involvement vs. accountant engagement.  We can also help you filter through the various accounting options to decide which one is right for you.  We’re here to help….give us a call to schedule your free consultation.