Accounting automation software has been growing in importance in recent years. But it’s become especially vital in the wake of Covid-19.
Now, more than ever, businesses are looking for ways to keep costs down. For many, it’s the difference between going under or keeping afloat.
While everyone is cutting their cloth, it might seem counterintuitive to invest in accounting automation software. But the key word is “invest”. A mighty 64.4% of SMEs use accounting software and, like many trends, the shift towards automation is likely to accelerate in a post-Covid world.
Here’s why and how you can make your resources - especially accounting automation software - work for you.
1. It cuts labour costs
Redundancies and pay cuts are an unfortunate consequence of Covid-19. But automation does not necessarily mean redundancies: automation reduces tasks, not jobs. So this means that an employee who might otherwise be sifting through and filing receipts and invoices could be doing something else.
Indeed, manual invoicing can take as many as 15 steps before it’s done. Automated accounting software eliminates most of those steps.
The consolidation of information to the cloud and to one easily usable and searchable software package also reduces research and admin time: no more combing through endless files, Excel sheets or (worse!) filing cabinets.
In that saved time, you or a member of your team could be giving more attention to clients, researching new business prospects or analyzing the numbers in more depth.
Speaking of which...
2. It allows for more in-depth accounts analysis
According to a US Bank study, 82% of businesses fail due to cashflow mismanagement.
Accounting automation does more than remove tasks: it can offer insights that could bring long-term savings.
The greatest benefit here is that accountants are no longer struggling to get to Trial Balance, and are now spending that time advising their clients. The saved time mentioned in the first point (above) also frees up an accountant to share their wisdom and insights and guide the client to a healthier balance sheet.
Now, they are earning additional revenue because of the valuable advice they’re giving, making the client less likely to churn.
Having information consolidated in one place gives you the opportunity to identify trends, where too much money is slowly eking out, or where opportunities are left unexplored.
In today’s ferociously paced world, it can be hard to gain perspective. And that applies to your business and its comings and goings too. It could be one graph highlighting a worrying trend that you might otherwise have missed; or an accountant having more time to spot a concerning trend or potential opportunity.
3. Expenses can be tracked more quickly and accurately
Incidental expenses are a part of doing business, of course, but any accountant can tell you that they add up.
Clients’ receipts and invoices can be collated and automatically added to your software, automating a huge part of your job.
Instead of clogging up wallets with receipts and drawers with invoices, a business should be photographing and documenting these items. They’re more likely to be kept, less likely to get lost and they reduce clutter.
Making something easier to do, naturally, means that people are more likely to do it. Then, once digitized, a clear picture of expenses is painted - including areas where you might want to cut back.
Additionally, digitization reduces the potential for human error.
Every penny counts, and automation keeps a closer track on those pennies.
4. Automation is a remote working tool
For many businesses, remote working has become a reality, whether they were ready or not. In the US, 62% of staff worked remotely because of coronavirus (according to Gallup).
Accountants and their clients are communicating via video conferencing and phone calls, not in person.
This mass experiment of remote working was forced on us, but many companies are seeing the benefits of it - not having to pay rent and bills, higher productivity and in many cases, happier staff.
Automated accounting software is a massive help - maintaining documents in a shared cloud, allowing easy sharing of invoices and receipts and more.
Automation, in accounting and beyond, aids remote workflow, as line managers outsource some of the time management to reminders on Google calendars, add auto-reminders of deadlines to team members on Slack and consolidate marketing analysis into one document with an app like Stackby.
Accounting automation, along with other AI tools, are making businesses more agile, smarter and more competitive.
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