How To Get The Most Out Of Bookkeeping Software?

Answer 1

While many companies purchase expensive bookkeeping software packages, they often limit their use of these powerful software systems. Despite the advanced capabilities of bookkeeping software to save time, reduce staff costs and increase efficiency, many businesses use Quicken, Quickbooks and PeachTree as little more than glorified checkbooks. Leveraging the full operational opportunities available can save your business significantly. Try these tips to get started.

Instead of using your bookkeeping software to record only deposits and expenses in your business's checking account, take the time to set up your balance sheet accounts in the bookkeeping software as well. By investing the time now in detailing your company's fixed assets by type, both for book and tax purposes, you will later be able to track your company's assets on a yearly basis. This means being able to book depreciation journal entries or forward your fixed asset listing to your certified public accountant at the end of the year so that he or she can do so.

Your balance sheet accounts also likely include a number of investments. It could mean that your company holds long term investments in stocks, bonds or other traditional investments. These balances fluctuate daily, and you can use your bookkeeping software package to get an up to date picture of your company's finances by connecting your investments' online accounts to your bookkeeping software. Quickbooks and other bookkeeping software packages have the option to allow you to have daily changes or monthly statements downloaded to your bookkeeping software for easy reconciliations. This will keep your financial statements accurate while reducing the amount of staff time necessary to monitor your investments.

The financial information that your bookkeeping software can generate is useful for much more than providing your certified public accountant with your profit and loss statement and balance sheet at the end of the year for your income tax filings. Once you have input all of your information into your bookkeeping software package and set up your accounts receivable, Accounts Payable and other financial inputs so that they automatically feed into your bookkeeping software, you can use it to forecast future financial results. While no bookkeeping software can predict the future, you can use it your bookkeeping software in conjunction with Microsoft Excel and other financial modeling software packages to conduct trend analysis. This will allow you to identify areas of additional cost savings that you can take advantage of.