These days technology plays a part in even our simplest tasks, be it being woken up by an alarm, paying bills online or even just talking to someone. So, it is not surprising that technology plays a significant role in the way we do business, including the local accounting practice.
With technology comes change, and there has been a noticeably big difference in the way balancing books and verifying ledgers are being done in today’s day and age.
With the emergence of different software systems to support various accounting tasks, from filing invoices, making sure balances are in check, payroll, preparing sales forecasts, internal auditing, and government tax filing, it has clearly become easier for accountants to complete their jobs with accuracy and efficiency.
Technology and local accounting
Data collection, sales reports, balance sheets, computing taxes, preparing tax returns, analyzing trends, costs, revenues and financial commitments and payroll are no longer such dreadful, laborious tasks.
Gone are the days when you would see the stereotypical accountant working on overtime with piles and piles of paper on top of his desk as he is striking away, hunchbacked, at an adding machine and cross-checking the printout after, then doing it all over again twice or thrice just to make sure everything is correct.
With half the work already done by the accounting software, employees have become more efficient and get to accomplish more tasks during the work day, like interpret data and give sound financial advice for better business decisions.
Technology has changed the way local accounting is done, and it has even transformed the practice into a dynamic profession. There are a lot of different specialized accounting software available in the market that was designed for specific functions.
For example, there is software that focuses on preparing reports on assets and liabilities and summarizing a company’s current financial standing–others focus on sales forecasts; some on taxes.
Of course, there are also those that were designed to do all those things and much more in just one system. These systems provide tools that have been proven to significantly reduce the margin of error thus increasing accuracy in reporting. This, in turn, lessens any probability of wrong decisions due to misinformation, tax penalties, overdraft charges, late paid bills or such.
Companies that have opted to implement the use of an accounting software are more financially stable because they can correctly plan expenses and foresee any losses or gains. These accounting systems are already compliant with generally accepted accounting principle and tax standards. There is also software designed by local companies that also have local accounting standards integrated into the system.
Accounting for non-accountants
Solo entrepreneurs and micro or small business owners have a lot on their plate. They need to develop a booking system and establish sales tax procedures, determine tax obligations, calculate gross margins, among others. So accounting systems are definitely a godsend.
The advent of various accounting software has made it easier for business owners to be able to do accounting tasks for their businesses with a very little background if any at all. It gives them a systematic way of collating and analyzing their finances to plan their business properly.
Using software helps them keep track of their cash management, accounts payable, accounts receivable, payroll, inventory, bank and credit card reconciliations, and cost of goods with little effort and without the need to hire an accountant which, we all know, can be quite expensive.
Accountants have become more of a business consultant, they are there to recommend best practices and suggest ways to reduce costs and increase profit. Since it is cloud-based, they are easily able to monitor revenue, cash flow, track trends, losses, and profits, etc. from wherever they are.
This convenience allows small business owners or entrepreneurs to effectively manage their finances at any given time, and as a result, save their businesses some money.
With the advancement of technology, software developed in the recent years are all user-friendly. Making it easy for solo entrepreneurs and micro or small companies to use it without the need for extensive training to be able to understand how to use and navigate through the system.
So instead of toiling over managing invoices, bills, updating books, making sure all required government forms are complete and all the other accounting tasks, small business owners can actually spend more time working on how to grow their business.
Technology has made it possible for us to do away with adding machines and paper ledgers. We no longer need to spend hours and hours recalculating and manually inputting lost data since everything saved in a secure cloud-based system. Technology has certainly provided us with a lot of conveniences, changed our lives in a way we can only be grateful for, and local accounting has certainly benefitted from this.
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