What Is Accounting Software? Everything You Need to Know

If you’re self-employed or own a business, you’ve likely wondered if accounting software is the right choice for your needs. Yet the decision to begin using a small business can be complicated by the fact that not all bookkeeping software and accounting systems are the same. Understanding what accounting software is, the purpose of the software, and the benefits of accounting software can make your decision easier. 

Don’t feel overwhelmed if you’re a novice when it comes to crunching numbers. We’re here to help. This article will break down the basics of small business financial software and online accounting systems. 

What Is Accounting Software?

Accounting software is a digital program that performs bookkeeping tasks and keeps records for future use and reference. Some of the most common bookkeeping software tasks accounting programs can complete include:

• Automating payroll and taxes
• Keeping track of accounts payable and accounts receivable (AP and AR)
• Balancing bank accounts
• Invoicing
• Calculating overhead, profits, and revenue

Accounting system software used to be purchased via a CD-ROM. Now, small businesses, accountants, and self-employed individuals can access the best business accounting software online. This often includes remote access via smartphones, tablets, and laptops.

The Purpose of Accounting Software

Accounting used to involve stacks of forms, guidebooks, and calculators. With accounting software, the most complicated calculations become easy. This can serve a multitude of purposes for accountants, accounting firms, and small businesses.

The Purpose of Small Business Financial Software

Simple bookkeeping software simplifies money handling, bookkeeping, taxes, and financial planning, allowing small businesses to keep their accounting in-house. Not only does this save money (increasing revenue), but it also allows business owners to make better-informed business decisions in real-time. 

Basic accounting software for small businesses also allows a more hands-on approach for business owners. 

Advantages of Accounting Software for Small Businesses

When a business owner knows the numbers they can:

• Cut costs more expediently by seeing the overall picture at a glance
• Respond to supply and demand trends
• Save time by not manually calculating payroll and taxes
• Analyze profitability year-over-year
• Track employee performance and sales
• Pay bills easily and on-time
• Keep track of AP & AR
• Reduce busywork
• Use customer service to help with software support
• Use cloud storage
• Achieve goals faster

Benefits of High End Software for Accountants

As for assisting accountants in their day-to-day tasks and keeping track of their client accounts, the best accounting programs for small businesses feature more advanced accounting tools. These tools can make light work of difficult tasks.

With the best finance software, accountants can increase their productivity and take on more clients. They can also rest assured that their numbers are accurate, up-to-date with the latest IRS and other regulatory numbers, without having to look up information. And accounting software keeps records more organized and accessible. 

Advantages of Using the Best Bookkeeping Software as an Accountant

Here are some advantages of the best bookkeeping software for small business:

• Increased productivity
• Easy record-keeping
• Simple form creation and sharing
• Streamlining and prioritizing tasks
• Easy invoicing
• Automated calculations
• Remote access to numbers for client meetings
• Increased customer satisfaction
• Streamlined communication with clientele
• Improved accuracy and up-to-date regulatory information
• Better storage systems
• Simple IRS, state, and local reporting
• Auditing made easy

Where to Find Financial Tax and Accounting Software

You no longer need to sort through boxes of software to compare tax and accounting software. Online companies, such as Sage, offer clear insight into their accounting packages, so you know exactly what kind of financial accounting software you will purchase and how it works. 

Comparing Top Accounting Software Programs

When it comes to the best accounting software for small businesses, comparing capabilities, accounting tools, and functions of such software can be tricky without committing to a subscription. However, reputable software companies will let you preview the functionality of all the accounting packages they offer.

Furthermore, you can read accounting software reviews to get a clearer idea of who uses the product and if they are satisfied with it. 

When comparing the best business accounting software options, take note of what reviews mention about specific advantages and difficulties they experienced. Finding accounting software reviews from other entrepreneurs in your industry can also help you narrow down what the best online accounting software for your small business will be.

What Are the Different Categories of Accounting Software?

The functions of accounting software should reflect the business size and industry it is designed for. This means you will find a wide array of different categories of accounting software available online. Additionally, you will also find simple bookkeeping software that adapts to general business accounting needs, including taxes.

Types of Accounting Software

Here’s a short list of accounting software that exists for various industries:

• Small business bookkeeping software
• Medium business accounting
• Construction accounting
• Food and beverage bookkeeping and CRM software
• Financial accounting for growing businesses
• Manufacturing and distribution enterprises software
• Accounting & tax software for accountants and accounting firms
• Business software for start-ups and tech firms
• Accounting system software for nonprofits
• Accounting packages that can be customized for any business, including financial software that integrates
• Inventory
• Operations
• Assets
• HR
• Fulfillment
• Project management

Choosing the Best Business Accounting Software for Your Needs

When it comes to finding top accounting software, there are plenty of companies to choose from. However, Sage provides small business owners with a multitude of accounting packages to best fit their individual needs. This provides each user with a unique solution for performing tax and financial processes to streamline inventory. Because functional software should reflect the unique needs and tasks associated with your business.

Financial accounting software shouldn’t be difficult, and it should offer you and your business solutions to the most pressing accounting needs.

Learn more about Sage, the best accounting software for small businesses.