Battle of the Accounting Systems: Manual Bookkeeping vs. Accounting Software
The series of accounting steps that must be completed to process and prepare financial information and statements forms part of, what is commonly known as, the accounting cycle. This accounting cycle can be driven by either a manual or software-based accounting system.
If it ain’t broke… why change to a software based accounting system?
The transition from manual accounting systems to a computerised accounting system may seem a scary thought at first, but once you’ve got to grips with your business accounting software (assuming it’s a reliable and renowned product that is relevant to your business needs) you will quickly discover how much easier it makes your bookkeeping.
The move from manual to financial software can be likened to the jump from bicycle to motor vehicle, or from the doggy paddle to the Jet Ski. Computerising your accounts will get you ready for the year-end quicker, more easily, and more accurately.
Accounting Software Benefits
Speed – Bookkeeping software is able to run reports much faster than manual accounting systems. Reconciling your accounts is quick and easy: As you input various transactions, your software will automatically pull this information through to the relevant ledgers and journals. Your balances are also updated automatically.
Accuracy – By using business software you are ensuring a more accurate and efficient accounting cycle. Where previously, mistakes could be made by manual processes, accounting software reduces these mathematical errors. It doesn’t allow for input of incorrect data such as credit-debit mistakes, and it automates postings to various ledgers and journals, virtually making data capturing mistakes obsolete.
Fluid, meticulous results – Want to know where every cent goes without having to dig for hours through your financial books? Accounting software offers you the advantage of viewing your records at just the click of a mouse.
Quicker and easier to pull reports and financial statements – You can run a variety of reports. Post amounts to various accounts and update balances. Preparation of your financial statements is just a mouse click away.
Automation of steps in the accounting cycle – Once you have analysed your source documents and journalised your transactions, a usually laborious manual accounting system can be replaced by an automated accounting system.
Here are a number of steps in the manual accounting cycle that will be automated by a reliable accounting software program such as QuickBooks:
- Posting to Ledger accounts
- Preparation of Unadjusted Trial Balance
- Posting of adjusting entries
- Preparation of adjusted Trial Balance
- Journalise closing entries
- Posting of closing entries
- Prepare a post-closing Trial Balance
- Preparation of financial statements
Are you ready to move from a manual accounting system to a financial software program?
With a solid accountant (or accounting department) and a reliable business software program you can enjoy an accounting system that helps better manage and reflect the condition of your business.
Here are our 3 top QuickBooks tips to using financial software:
Make sure to purchase accounting software that is widely used and well-known; this will save you many headaches, instability and worry. With almost 4 million business software users worldwide, QuickBooks is regarded as an industry leader in accounting solutions software. QuickBooks is affordable, effective and easy to implement.
You never lose what you do save. Make back-up copies of your financial information on a regular basis. A routine back up to hardcopies will avoid any major systems disasters.
Unsure of what your business accounting needs are? Why not begin with QuickBooks SimpleStart. You can update your software package at any time with virtually no hassle.