Friday, January 20, 2017

Accounting Made Easy

Accounting is not just about figures. Data collection, maintenance, and auditing of financial records are all part of the deal of being an accountant (a.k.a. bookkeeper). Bookkeepers list related debits and credits of clients in chronological lists.

Early accounting technology proves that even during the time of Leonardo Da Vinci, the idea of using machines in solving numerical problems is evident. Da Vinci designed the Codex Madrid machine which contains thirteen wheels that register digits. Several other attempts to improve such technology was depicted. The invention of the early calculator by a French scientist named Blaise Pascal has made accounting less arduous. Several other technological improvements were developed to increase speed and efficiency and greater accountability for bookkeepers.

Although several other improved machines have flocked in the market for the improvement of the accuracy of the accounting process, paperwork still did not cease. Bookkeepers still keep their journals, ledgers, accounts for receivables, and accounts payable in handwritten formats and prepared by hand. In later years, accounting machines and billing machines were refined for advances in mechanical operating complexity and electronic calculating capacity. These new generation accounting machines are mostly operated by a computer.

Keeping an accurate record of data is critical. And since finances are changed from time to time, computerization of accounting task increase efficiency in the office. With such improvement, requests for updates of records are just minutes’ notice.

Computer plays an integral role in this technologically-minded society. In the field of accounting, software and applications are widely available for efficient and convenient accounting. Among others are electronic spreadsheets (e.g. Microsoft Office’s Excel) and point of sales (e.g. NCR POS machines).

The major significant difference of a computerized accounting system is the integration. When the transaction is being input in the computer, the figures are carried to all the necessary modules or components of the system that uses them. Thereof, redundancy is completely rid off as only one entry is needed to be entered. Unlike in a manual system, figures would be entered several times.

Another known advantage is the accessibility of information over time. In a computerized system, information is posted immediately once updates of records are being accounted. As such, financial statements and reports are obtained frequently by clients. Information, therefore, is handled in a very simple yet straightforward manner.

E-accounting, which is an online application in Internet technologies, enables accounting processes to be performed in internet-based accounting tools. Online accounting in web applications will enable accountants and advisors to access records anytime and anywhere so long there is an internet connection available.

The functionalities to look for in web-based accounting applications are: anywhere access – secure log in anywhere over a high-speed internet connection; unlimited user access – accountants, business partners, and assistants collaboration; automatic data backup and unlimited data storage – no limit on the number of transactions and data are being backed-up in secure locations for fail-safe purposes; no required installation; time and money savings through the bank statement upload – cut bookkeeping time in about 60 percent from the usual, real-time financial reports, and overdue invoices and bills tracking; multi-currency support – automatically downloads daily exchange rates to track down invoice clients and expenses with multiple currencies; and ultimate search – search for customer of vendor in seconds.

Trying out different accounting software packages will help accountants and business owners to learn the latest buzz in accounting.

Some desktop software vendors like Intuit has relatively made solid moves towards web-based applications. It’s QuickBooks online has been in the market for quite some time for small businesses. The release of Quicken Online has fiercely competed with other existing web-based accounting applications with its price. For as little as $2.99 in a month, the deal will work wonders. It even has a 60-day trial period. Other competitors like Freshbooks, Xero, and Zoho which offered pure accounting features like payroll, invoicing, and etc. is something to look forward to especially that some of these vendors are claiming to have over 400,000 users. Some impressive new entrants like Mint, Wesabe, Expensr, Geezeo, and Rudder focus on personal financing – budgeting and bank accounts.

With this technological advances, fraud and sabotage of information would be major forms of destruction. Bookkeepers or auditors should ensure that the system can survive these hazards.