A small business is a business like any other, so proper records should be kept to increase accountability of how the funds generated are spent. This means that the act of accounting is required. Accounting is a systematic process of recording, analyzing, summarizing and presenting the information to interested parties. These parties may include the managers, employees, government, tax authorities and others.
There are both formal and informal accounting methods. Most small business adopt informal accounting principles. They are more likely to keep the incomplete records. The accounts in a small business can be done using a manual system or computerized systems. To this day, many small businesses have opted using a manual system as they tend to be cheaper as compared to the computerized ones and require less expertise.
QuickBooks is a program often used by small business operators to keep track of the costs and all financial business operations. Quickbooks is a program from Intuit, which has been providing accounting software for many years. This program helps in the management of accounts payable and receivable as well as tracking expenses.
Another package is the Gnucash package that is a free package used by people using the Linux operating system as well as Windows. This program is most accurate and effective when it comes to applying double entry accounting principles and also when tracking bank accounts, incomes generated and expenses declared. It gives relevant and required information and ensures accurate financial reports are generated. (See http://en.wikipedia.org/wiki/GnuCash)
Another option is the Turbocash package. It is diverse and even medium sized businesses can use it. It creates a general ledger and helps in posting transactions into different accounts and producing financial reports. It assists in managing creditors, debtors, invoices and also the bank reconciliations. This system is unique in a kind that it can be set up in a way it uses different currencies.
Cashflow Manager is another package aimed specifically at small business. Developed in Australia, the US version is called Simplazz 1-2-3. It’s a rule of thumb that in order to be successful in preparing the financial reports you must possess accounting knowledge. The Cashflow Manager or Simplazz 1-2-3 package enables those who do not possess any accounting knowledge to prepare financial reports. This system is advantageous in that it is easy to understand, saves time and money.
If you want to keep excellent books and not need to use a computer, the Accounts Manager Manual System can be used in the UK. It is also helpful in that it acts as a learning tool for the bookkeeping process. It has instructions that act as guidelines, gives examples, has sections for recording receipts, recording payments, wages computations, creating a cash flow budget and also helps in VAT computation and reporting.
Xero software seems to be the flavor of the month because it is spending huge amounts on marketing even though it has never made a profit. It seems to be banking on building a large client base at any cost. Maybe the plan is to then sell it off which is an interesting strategy. It has a lot of add-on modules such as payroll tools, invoicing, inventory accounting, payments and budgeting and while it is a good program, it is quite costly to own when you do a 5 year cost comparison with other alternatives.
Expensify is especially an expense software. It uses a smart scan that inputs collects information, accepts receipts and matches it with relevant expense. It can also capture reimbursable expenses such as mileage.
Indinero is another system that is generally meant for entrepreneurs rather than accountants or tax professionals. It makes the information easier to understand for entrepreneurs and tracks the trading profits and loss accounts, the statements of financial position and the cash flow.
If you are looking at payroll, the Zen Payroll system focuses only on payroll. The user enters the data about the employees such as hours, bonuses, overtime pay and then the system automatically computes and pays the state payroll taxes.
Zenefit is a program that makes it easy to come up with benefits for a group on issues like stock options and medical. It also has a payroll feature and also helps entrepreneurs in the selection of insurance plan.
Small business software products are very important for any business that wants to make and maximize profits. Obviously, small business operators do not need to use all the systems but choosing the software that best meets their accounting needs is very important to be successful.
All businesses should choose an appropriate system and ensure they always do regular checks to make sure it is working for them.