Every successful business has its finger on the pulse of its financial information. Business owners need to know their key numbers, revenue, closed deals, cost of goods sold & not the numbers in last year’s tax return & financial statements. Last year’s information is out of date. Businesses need today’s numbers…Today!
A cloud accounting system can provide real-time financial information for your growing business. If you don’t have a cloud accounting system this blog will review how to get started with cloud accounting.
To recap, there are essentially just 4 types of accounting systems: manual, spreadsheet, desktop & cloud accounting which were discussed in detail in Part 1. While manual, spreadsheet & desktop systems may be initially cheap, they all have hidden time & system related costs. The benefits of a cloud based accounting system are numerous.
Your first decision is determining which cloud accounting system to adopt. Which has the reporting & functionality necessary for your industry (services, retail, construction, etc.)? There is countless cloud accounting systems & they are all different. Some have more functionality than others, some are better for specific industries, some have a more user-friendly interface & the list goes on. The major cloud accounting vendors Quickbooks Online (QBO) & Xero have add-on app’s (applications) that work in conjunction with the cloud accounting to further enhance the financial & non-financial reporting or minimize or eliminate time consuming functions. The add-ons are so extensive, that is a topic for another day. Assessing all the options is time-consuming. The point is, with all the options on the table choosing the wrong solutions will cause you a big headache.
Once you settle on the best system for you and your business, now you have to set it up! For an experienced accountant or bookkeeper, setting up an accounting systems typically takes a full day or more of uninterrupted time. System implementation requires entering all the key details of your business (accounting year end date, Federal Identification number, and so on) & you also need to set up you chart of accounts (that’s the specific types of sales, income, expenses, assets and liabilities unique to your business). Once that’s done you need to transfer any opening balances.
While you can set up the system yourself, your time is valuable. We recommend you talk to your accountant & trusted business advisor to answer questions about cloud accounting offerings & implementation. Every good accountant will be able to set up your cloud accounting software.
We specialise in cloud accounting, so if your accountant doesn’t offer this service we can help. You don’t even need to be in the same part of the US… we can set it up online for you. With real-time access, your accountant & trusted business advisor located anywhere in the world can help you operate, understand & grow your business rather than just adding up the numbers.
To find out more about cloud accounting, contact us at bodhi@bodhibusinessadvisors.com.