When it comes to selecting accounting software, there are a number of options available in the market and it can be overwhelming to choose the best one. The following is a list of factors to be considered while choosing accounting software:
1. The Size of the Business Organization: The size of the organization and the volume of the business transactions entered into influence the choice of software. While a large organization will require software that meets the multi-user requirements because it is geographically scattered and connected through complex networks, a smaller organization may opt for simple, single user operated software.
2. Ease of Use: The interface and navigation should be simple and self-explanatory. There should also be an option for data back-up. Preference can be given to vendors that offer help at no additional cost, have reasonable service plans or offer tutorial training that walks the clients through the most popular business tasks and transactions.
3. Features: What particular software offers is an important consideration. A list of the primary things that the business needs to track and account for should be carefully prepared. The business must know how much each service or product costs and be able to track the cost of goods sold (COGS). Features like invoicing, online payments, payroll, auto payments, reporting, bank balances will help to stay up to date on sources of business income, expenses and where it may need to make adjustments.
4. Protects Classified Data: When financial data is stored in the cloud, there is no longer the possibility of vital information being lost in the event of a hard drive crash, power surge, or coffee spill. The data is backed up on external servers. However, with cloud-based software comes, the threat of classified data falling victim to malicious activity. Online banking has set a standard for security, so it becomes necessary to ensure that the chosen software either meets or exceeds this standard. This means Secure Socket Layer (SSL) encryption, multi-layered firewall server protection, and routine external audits and inspection.
5. Compatibility: If there are other financial tools that are used in the business – for example, an e-commerce system, then business would want to look into the compatibility of the financial software with any other essential software to run the online or storefront portion of the business. In an ideal world, it may want a solution that provides most of what it requires in a single program. However, if it must have multiple software packages, it will have to ensure that the data can automatically be linked for real-time updates or transferred daily with the upload of an Excel or CSV file.
6. Price: While price is a necessary factor to be considered, it shouldn’t necessarily be the deciding one. The ability to manage money is far more important if it’s the difference of saving just a few rupees. What one should be aware of is the different pricing models that are used by software product providers. Having suitable software in place, will allow a business to stay on top of cash flow and focus on what it does best (i.e. allow the business to focus on its core competence). It also helps keep the records clean.
