Most businesses use some form of electronic software to record, store and analyze accounting transactions. The size of the business and the industry will usually determine what type of software is used. It is a good idea to know the basics of some of the most commonly used accounting software.
There is a plethora of accounting software being used and advertised and there is no way to know them all; however, understanding the basic fundamentals of a select few of these will help in the long run. This does not mean one should not step up their Microsoft Excel skills but it does mean one should not only rely solely upon this program. As previously stated, the type of software used is based on the size of the company, the industry, and the cost the company is willing to pay to purchase the software. Typically “big box” companies will use SAP or Oracle as their accounting systems, mid-size companies will use Sage or Microsoft Dynamics and smaller companies will use QuickBooks. This list is not exhaustive but it is a high level, generic overview of some well-known accounting software.
Accounting software allows for an easy flow to managing the accounting aspects of a business with speed and accuracy. The advantages of using accounting software include, but not limited to, ease of recording transactions, less storage space needed, quickly generate financial reports and statements, and automatic calculation of data. Utilizing an accounting software ensures that employees can use their time effectively and efficiently.
The importance of having accurate accounting can’t be stressed enough. The integrity of a business lies within its accounting records and using an accounting software can reduce errors significantly. This does not eliminate errors but it can decrease the amount of errors and assist in spotting them sooner rather than later.