The Benefits of Automating Accounting
So why isn’t accounting automated at your company already? If you’re on the fence about whether to automate accounting, consider some of the benefits you’ll enjoy:
1. Easier to Extract Data
Once you have the system set up, it’s easy to extract information from your files and ledger. Whether you have a question about payroll or the income statement, it’s quicker to get answers with automated accounting.
2. Faster Data Transfer
Financial automation lets your company access and transfer data without it being touched by human hands. There’s less chance of an internal actor manipulating confidential data or sharing it with outsiders. Accounting automation is a cybersecurity asset.
3. Cloud Storage
Storing accounting data in the cloud makes it potentially accessible wherever you go. Automated accounting software is equally accessible, making it simple to, for example, cut a check when you’re miles from the office. Plus, cloud-based accounting software is cyber secure, meaning your data security will be much better than if you were using physical in-house servers.
4. Saves Time
The automation of accounting saves you and your team time. It takes less time to enter information, check calculations and run reports. Reconciling information is quick because all the data is already in the system. In-house accountants are more productive; external accountants require fewer billable hours to do the work.
5. Handy Dashboards
Automated accounting makes it easy to create a financial dashboard. Like a car dashboard, it’s a display that collects key financial metrics and presents them in an easy-to-see display. You can see profit, overhead, operating costs or whatever data you’re concerned about. Accounting Seed can automatically populate your dashboard with the specific data you want.
6. Flexibility
Good software is flexible. If you develop new income streams or non-operating expenses down the road, it should be simple to adjust the general ledger, your accounts payable, and other modules within your accounting dashboard.
7. Simpler Foreign Exchange Accounting
A streamlined accounting automation software solution such as Accounting Seed can automatically calculate exchange rates for foreign exchange accounting. Learn more in the guide to Foreign Exchange Accounting: Buying Goods & Services with International Currencies.
8. Automate Accounts Payable
Your system can automate receiving and paying invoices, making your outgoing payments process smoother and taking up less time. Vendor payment processes have worsened across the United States since the pandemic, meaning you’ll stand out from the crowd and build trust with vendors at a time where crucial supplies are limited due to supply chain issues. Learn more in the guide to Vendor Payment Processes.
9. Fast Data Retrieval
With automated accounting, data retrieval is instantaneous. It’s just as easy to get information about earnings or cash flow in the middle of an accounting period as when you make out the statement at the end of the quarter. To make things easier, transactions are automatically pulled into your financial dashboards, giving you intuitive, customized charts and graphs that can be helpful for making important business decisions.
10. Automatic Tax Record Keeping (& Sales Tax Inclusion)
The IRS advises keeping tax-related records for three years, sometimes more. In hard copy that requires filling up a lot of office space with file cabinets crammed with papers. With accounting automation you don’t have to clutter up your office. When you need information it’s easy to retrieve pertinent tax records.
Another benefit of accounting automation is the automatic inclusion of the relevant sales tax rate. If you’re buying and selling in various states, Accounting Seed will automatically calculate the relevant sales tax amount for the state at hand when a transaction occurs.
11. Easier Cash Flow Tracking
When you automate accounting, it’s easier to track cash flow. Call the relevant metrics and projections up on a financial dashboard and you can spot cash-flow problems faster.
12. Improved Employee Morale
Not only does automated data entry save time, it protects your staff from boredom. Data entry is tedious work; they’ll be much more engaged with their jobs if there’s more thinking and less routine.
13. Painless Tax Time
Paying taxes becomes much simpler once you automate accounting. All the time consuming record keeping and form filling can be handled automatically.
14. Recurring Tasks
An automated accounting system like Accounting Seed is particularly useful for handling work you know you’ll do over and over again. For example, its innate accounting workflow automation can take over the responsibility for recurring payables, recurring billing, and recurring journal entries.
15. Bank Account Management
Using an automated system like Accounting Seed, you can schedule an in-the-background download showing all the transactions for a given period. You can set up your accounting automation to run after hours or on the weekends. The bank direct connect feature automatically connects each bank record with a given transaction.
16. Revenue Recognition
The Accounting Seed software makes it easy to recognize revenue. The program is customizable so you can set it up to work with your company’s unique requirements and procedures for accounts receivable.
