The Most Helpful Reports for Small Business Accounting

Most small business owners know that data entry - when it comes to your accounting - is important.  What's equally important is interpreting those numbers into meaningful and digestable information that can help your business thrive.  There are as many types of accounting reports as there are software tools to create them.  Here are 10 that may come in handy for you.

The 10 most helpful reports on your accounting software
By Elizabeth Gillam of myob.com

When you own a business it’s all too easy to be caught up in the day-to-day running of the business. You find yourself working in the business, not on the business.

It is tempting to stay in the comfort zone of the day-to-day rather than face the reality of the business by researching your reports.

But the only way you can truly know how your business is going is by checking your back-of-house reports to find your Key Performance Indicators. Knowing your numbers and understanding the data in your reports helps you to be a better manager — and run a better business.

Get into the habit of printing and analysing your daily, weekly and monthly reports to improve your business performance. It only takes a short time each morning, and it increases your chances of meeting your targets and budgets exponentially.

To help you out on which reports to run, let me suggest my top 10.

1. Analyse Sales report
You should run this report daily; it keeps you on your toes and details your sales history.

You have sales budgets, and it is important that you meet them. This report shows you the productivity of your sales team. It also tells you who your most important customers are — the ones who spend the most money.

Learn who these customers are to be sure you are giving them excellent customer service.

2. Sales Customer Detail report
This report shows you which customer is ordering what. This enables you to better know your customer and offer them superb customer service by suggesting other items they might like to purchase from you.

This report also enables you to set your production or ordering schedule. If you are selling items, then your stock levels need to be replenished.

3. Sales Register
This report should be done each morning to track where you are on outstanding quotes, sales in progress and finalised sales.

Your sales people value leadership, and this report allows you to have a conversation with each salesperson every morning to set their daily task list.

4. Aged Receivables Summary
Use this report to monitor your cash flow — the cash you have on hand to pay bills and run your business.

I’m sure you have terms on your invoices, and it’s important that your clients or customers don’t abuse their privileges. Each time a customer takes longer to pay their account, the more it costs you.

Make it a habit to print this report every week and ring each customer whose account is outside your terms of trade. The squeaky wheel gets the grease — make sure you are that squeaky wheel.

Want more invoicing tips? Read 6 quick fixes to improve your invoicing process.

5. Cash Flow Analysis report
This report is gold for the business owner. It will show you what cash will be coming into and out of your account over a set period of time.

If this report shows a negative, it will give you all the more reason to use the aged receivables report from above to identify those customers outside trading terms and ring them to get their money in.

6. To-Do List Receivables report
This report should be run daily. It will tell you whose account is due when.

It’s a great opportunity to ring a client when their account is due to firstly offer further sales assistance and potentially sell more product. You can also mention that their account is due.

This is a great initiative to not only build sales but also to offer superior customer service.

7. Bank Register report
Run this report daily to check to your bank statement.

It helps to identify that your sales from the day before have in fact been banked and that the right amount has been banked. The number of times I have seen money disappear from when it leaves your office until it hits the bank is mind-boggling.Finding an error the next day is always easier than trying to find it next week or next month.

8. Undeposited Funds report
This report helps you keep an eye on transactions that have been paid by the customer and receipted in your system but are yet to hit the bank.

It gives you an idea of how much cash is sitting in your store and whether it is over your insurance levels. It will also show you how much money you have waiting to be settled from credit card transactions.

9. Profit & Loss report
This is a monthly report that is essential for any businessperson to use. It shows you how much profit you have made.

Diving deep into this report will show you where your sales and expenses are coming from. Paying close attention to small improvements on every line of this report will lead to greater profitability.

Want to get a handle on the key drivers of increasing profit? Read more here.

10. Profit & Loss Report to Budget
This report compares your actual figures to those you budgeted for previously in the year.

It will show you if you are on track to reach the goals you set yourself and your business when you prepared your budgets. It helps you to run a tight ship.

Having a software system is a given in business. Using it effectively is the difference between a good businessperson and a successful businessperson.

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Small Business Accounting Software: Use Free Software or Pay?

A big part of what Accounting Works Solutions does is help small businesses implement a user-friendly system (including software and accounting platforms) to meet with current and future accounting needs.  Whether that means invoicing, inventory cost estimation, tracking expenses, or payroll - it's important to plan for growth.  My experience is that when small businesses start from the ground up working with a professional accountant, they save time, hassle, and money.  If you get started with the correct platform right away, it can not only grow along with your needs but it can save you from having to learn an entirely new system once you've achieved your growth goals. 

How to Choose Between Free and Paid Small Business Accounting Software

By: Juan Martinez

As your company matures, it's important to determine whether or not you need a software upgrade to streamline business processes. This is particularly true in saturated industries. If dozens of reliable partners are available to meet your needs, how do you determine who to choose, how much to spend, and whether or not your choice tool is secure enough to handle your data? Perhaps no other industry creates this dilemma like the accounting software market.

With freemium, small business, and enterprise tools available, it can be difficult for small to midsize businesses (SMBs) to determine which solution is right for them. You might have the money to buy expensive software such as Cougar Mountain Denali Summit and Microsoft Dynamics GP, but do you really need all of that customization functionality and scale? Conversely, you might be able to get away with using free tools by companies such as Wave, but is the tool smart enough to handle more complex tasks?

To find out what SMBs should look for when choosing paid accounting software, I spoke with Scott Davisson, co-founder of Acclivity, provider of desktop-based small business accounting tool AccountEdge. I asked him about pricing, flexibility, security, and customer service.

1. Does Your Paid Software Do More Than the Core Four? 

Davisson said most of the free accounting tools can handle account management, expense tracking, invoicing, and sales. These are the bare minimum tasks that any tool should be able to help you accomplish, regardless of how much you're willing to pay.

"That's the core," said Davisson. "If all you need is to do that, then you're probably fine on a freemium model. As those needs get more complex…that's where you might start to evaluate your needs about what's out in the market and how much it costs."

Additional needs might arise that your freemium tool can't handle. If you need software that can handle things such as billing for time, inventory tracking and payroll, you're probably going to need to invest in a paid tool. Also, although most free tools can handle sales data, if your business has multiple departments, you might want to consider going with a more complex tool because most freemium tools won't allow you to enter sales data by department (rather, you'll need to enter the data as one lump unit).

2. How Flexible is Your Accounting Tool? 

One of the main reasons businesses select enterprise-level accounting software over lower-cost or freemium applications is that enterprise tools often provide limitless customizations that can bend and layer the software specific to each client's needs. Small business tools, such as the one provided by Acclivity, won't offer that level of complexity.

However, this doesn't mean you're stuck with what comes out of the box. Think about what third-party integrations your SMB software offers. Does it integrate with a customer relationship management (CRM) tool? Does it pull in data from your e-commerce software? If a small business accounting tool can provide you with multiple integrations and add-ons, then you might not need to spend big bucks on an enterprise-level platform.

"The software needs to be flexible enough to meet your needs," said Davisson. "But it's a tricky goal. Our software isn't for one specific type of industry. We need to have a solution that fits your needs, but we don't have that out-of-the-box customizability. We're sort of like a Swiss Army knife. Our add-ons give customers additional components that bolt onto the software to continue to make it relevant to their needs."

3. Is Your Software Secure? 

One of the main points of differentiation that you'll find between enterprise-class, SMB, and freemium accounting software is the level of security that your vendor intends to provide. If you're not paying a cent for your software, do you realistically expect Fort Knox-level security?

This is one of the reasons Davisson said his clients prefer on-premises software to cloud-based tools. "A lot of people are pulled to the cloud against their will," he said. "But they don't trust their finances in the cloud. It's about security and control."

AccountEdge is a desktop-based tool that can be expanded into the cloud with a companion app. However, Acclivity doesn't offer a cloud-only version of the tool. "Part of why we're seeing a lot of activity and interest is because, once we license the desktop software, you can put it on your own network, behind a firewall, it's yours," Davisson said. "In terms of security, that gives you the ultimate control."

This doesn't mean that cloud-based tools are inherently less secure than desktop apps. For example, Intuit QuickBooks Online Plus stores data on firewall-protected servers where the data is encrypted. When your data leaves the web browser, it's transmitted over Secure Sockets Layer (SSL) encryption technology. Intuit also lets administrators limit who can access specific types of data inside the tool should they decide to make certain information available to executive-level employees only.

4. Customer Service 

This one should be a no-brainer. The more competitive a market becomes, the more important customer service has to be. Can you reach your accounting software vendor if and when something isn't properly working? Can you reach them on the medium of your choice or do they force you to pick a specific communication platform? Are the service representatives speaking your language or did the vendor outsource its help desk team?

These are incredibly important questions you should ask each of your prospective vendors. It's highly likely that enterprise-level accounting software will offer 24/7 support, especially if you're willing to make five-figure annual payments or more. However, if you're trying to choose among a list of freemium and paid SMB tools, you'll want to closely investigate your service options.

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Is Cloud-Based Accounting Right for Your Small Business?

Accounting Works specializes in helping small business owners set up easy to use software for everyday accounting needs.  If your business involves being out in the field or multiple employees conducting transactions, Cloud-based tools might be the right option for you!  Since everything can be accessed from anywhere your expenses and invoices can always be up to date even with multiple users.  One of the benefits of a subscription-based service is that updates will be available regularly at your normal subscription cost rather than purchasing updated software every few years.  This article from Entreprenuer.com goes into detail about how Cloud-based accounting could benefit you.

3 Benefits of Cloud-Based Accounting Tools for Small-Business Owners
By: Jen Cohen Crompton

What do a pastry chef, a construction project manager and a creative design director have in common? As small-business owners, each opened up shop to serve customers and do what they love -- not to spend hours on accounting or bookkeeping.

Fortunately, today’s small-business owner can take advantage of an ever-growing suite of organizational tools and technologies to reduce the headaches of managing invoices, bills and receipts while increasing the time spent pursuing new business opportunities. These tools are increasingly available as cloud-based offerings, and most small businesses should consider migrating their current accounting workflows to the cloud.

What, exactly, is the cloud? Cloud-based software, or software as a service (SaaS), offers users access to technology on a subscription basis. The software provider securely hosts all necessary databases and servers, and small-business owners access their data anytime, anywhere via internet connection.

Many small-business owners may wonder if they can expect the same functionality from cloud-based accounting programs that they’re accustomed to with traditional desktop versions. While it’s true that cloud-based versions of tools like QuickBooks may provide slightly different functionality compared with a desktop version, what current versions of cloud tools lack in functionality they make up for in versatility and long-term viability.

Software providers are likely to continue phasing out desktop solutions and limiting or discontinuing support, which means that customers who migrate accounting workflows to the cloud today won’t be stuck with an unsupported product in the future. Additionally, small businesses that upgrade accounting workflows to the cloud can also enjoy a number of other benefits that SaaS models allow. Here are a few:

1. Enable smart organization for a distributed workforce.
Since accounting information stored in the cloud can be added or accessed anywhere, team members can quickly and easily complete their work regardless of their physical location. Whether a sales rep needs to add expense receipts or a project manager needs to check an invoice for a supplier, having cloud-based tools in place makes organizing and accessing important information as easy as taking a picture of a document or searching by vendor, amount or date.

2. Maintain relationships and easily verify discrepancies.
Relationships with vendors and distributors play an enormous role in the success of many small businesses. When a vendor or distributor questions why a bill hasn’t been paid, small-business owners that leverage cloud-based tools can quickly search for invoices. Advanced cloud tools allow team members to search by virtually any term to locate a bill and identify whether it was missed and pay for it quickly to preserve the vendor relationship.

3. Use a broader suite of secure apps.
Cloud applications such as QuickBooks Online and Neat not only provide access to information and documents from any device, but they also integrate with other cloud-based tools. As soon as a small business starts using one cloud-based accounting technology, it’s easy to extract and leverage data across a number of different platforms and reduce time spent on manual data entry.

Small-business owners start businesses because of passion for what they do -- not to spend time managing paperwork. Migrating traditional accounting workflows to cloud-based solutions enables small-business owners to reduce time spent managing information and improve overall operational efficiency.

For the original article, click here.