For those wanting to start using software to manage their accounts, we’ve put together an overview of what to expect from a basic accounting software package.
Reliable accounting software can take away the strain from your regulatory responsibilities in terms of tax returns, selling outside the UK and doing your end of year filing. It’s now easier to use than ever before, it’s secure, as well as being accessible from any device with an internet connection.
A general ledger is a central location for all the accounting data running through your business. This should include all your accounts payable, accounts receivable, cash management, fixed assets and purchasing. Whether you want an accounting package for your sales, one for your purchases and a third for expenses, an accurate and easy to use ledger is vital for control over your finances.
Sales and purchase ledgers
Other ledgers (such as our sales and purchase ledger) may include a separate area for you to enter non-stock invoices such as rent, office supplies, freight, and duty. These transactions will be submitted to a nominal account chosen by the user when entering the data, then double-entered against the debtors or creditor account as appropriate. If Tax (VAT) is applicable to the transaction, an entry can be made to the appropriate VAT account. The transaction will also be posted to the sales and purchase ledger which will appear on the customer’s or supplier’s statement.
Whether it’s basic or advanced invoicing, all accounting software should offer the ability to quickly create, manage and send off your sales invoices. Once those invoices have been created and issued, this should have an automatic impact on your trial balance, profit and loss statement, balance sheet and customer statements.
For more advanced invoicing, look for an accounting software that offers you the ability to brand your invoices. That might be with notes; thanking a customer for their purchase, reminding them of your contact details, or telling them about any current offers. That might also mean branding the invoices themselves with a company logo. Automation will mean your invoices are being sent as soon as they are generated, using professional email templates of your own design. This ensures not only customer retention, but also a positive impression for your first-time buyers.
Account or bank reconciliation
Reconciling your bank accounts is the process of matching the balances in your accounting records to the corresponding information on a bank statement. Comparing your internal records against your monthly statements from external sources (such as your bank, credit card etc) is important for the financial health of your business. This is a process that will flag up any mistakes, discrepancies, or a potential fraud in your figures.
These reconciliations typically take place at the end of every month when the bank sends over your company’s bank statements. These statements will include the bank’s starting cash balance, transactions, and the end cash balance. Accounting software not only makes these checks easier to undertake but gives you the confidence to carry them out as often as you need.
Within a few clicks of the system, you’re able to bring together reports on your sales orders, purchases and returns from any financial period. Having these reports at your fingertips are not only a powerful way of driving KPI’s, but keeping control over the most important areas of your business.
An example of some of these reports might include:
- Product Item and Type Sales
- Customer Sales
- Monthly Sales
- Invoice Sales
- Campaign Summary
- Custom Reporting
Integrate with other providers
If you’re wanting to integrate your software with other business applications, it’s important you’re using business management software that allows for multiple integrations. Khaos Control Cloud integrates with Xero to expand the accounting options already available within the system; including automatic bank and credit card account feeds that allow you to control your ingoings and outgoings, as well as multiple tax rates and currencies.
Improve the way you handle your accounts
Still curious to learn more about what to expect from a basic accounting software package? Check out our own accounting software to see the basics, and a whole lot more.