All business owners want to invest in the right accounting software so that they can ensure getting on-time and trouble-free payments from the customers. If you want to invest in the right accounting software, then you should know the basic features of good accounting software. Usually, all accounting systems use double-entry accounting to reduce the probability of errors.
The accounting software helps in managing accounts receivable, accounts payable, banking, and reporting features. Some of the features include optimum inventory management system, time tracking, project management, payroll tools, and many more. But, these advanced features are only available in the high-tier plans or add-ons.
Here, we are going to discuss the core elements in the accounting system:
1. Accounts Receivable
The accounting solution should be capable to manage the billing system and also able to keep track of what customers owe. Some of the main features that you should look for in the accounts receivable management software are:
The accounting software must be capable of managing the invoicing system. When money is owed to your company, then it is imperative to know from whom, the total amount, and what is the deadline for receiving the payment. Various accounting systems also let you easily print the invoices after sending these invoices through emails. Also, your accounting system should be capable of storing basic customer data like addresses, account numbers, basic customer data, and standard terms. The latest technology accounting software also helps you to store the standard pricing system for a wide range of products and services.
This feature will make sure that the collection of payments will not be delayed due to delays in sending invoices. In addition to this, the accounting software will also help in automatically sending statements and late reminders to your customers. In short, it will automate various tasks of the accounting department.
Most accounts receivable automation software allows your customers to make payments online by just clicking on the link provided on the e-invoice. Allowing online payments to customers is also beneficial for the business owners because they do not need to deploy more staff members for processing checks or making deposits in the bank.
2. Accounts payable
Nobody wants to keep track of what they owe. But, the business owners need to make on-time payments and keep a record of due and paid amounts. Here, we will discuss the useful accounts payable features.
One of the most important tasks of the accounting software is handling your purchases and keeps track of what you owe. But, the functions of the different software are different. The accounting software should manage the due amount that the company has to pay along with the accounts receivable management system.
Vendor credit memos
Most business owners often lose track of credits that were hand-out by the vendors. These credits can be in the form of rewards or returns. These credit memos are very beneficial for the business just like cash.
The accounts payable module or debtors management software can help in scheduling the bank payments and direct deposits to printing checks. This feature will make sure that you do not fall behind.
IRS tax forms
The accounting software has information regarding the most common tax forms in its database. This information can save your business many times. It is true if the accounting system of your business puts the necessary details on the forms and automatically files them.
The modules of payroll are very much sophisticated in the accounting systems. These modules help in handling the entire Payroll services and automate everything related to calculating hours and processing wages, and making 401(k) deductions. The best features of the payroll module of the accounting system are described below:
Variable wage schedules
Some employees in the company get a monthly salary and some get paid hourly for their work. The payroll module of the accounting system can help in automatically calculating what you owe them.
It is one of the most important features that all accounting software must support. It is so because most people expect that their paychecks should be deposited directly into their bank accounts. Most good accounting solutions let you scheduled direct deposit payments.
Automatic tax calculations
This feature includes handling various basic deductions to offering sophisticated tax tables and printing forms as well. You should determine that whether your accounting solution supports new-hire reporting, tracking expenses, etc.
Expense Reimbursements And Deductions
If employees of your business incur tax-deductible expenses like entertainment expenses, travel expenses, then you need a system that can easily accommodate this reimbursement. It is important to make sure that all payments comply with tax guidelines.
The accounts receivable solutions must have a kind of link to the bank account. It will let you make direct payments and also help in importing real-time data. This module of accounting solutions also helps in accounts reconciliation and check handling.