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How to choose the right computer equipment for your business to increase your productivity and efficiency without it costing the earth.

Business software helps you complete a range of tasks. Choose the right software, provide support and train your staff with our introduction.

It is highly likely that you depend on the internet for some aspects of your business. Find out how you can use the internet more effectively.

Good communication with customers, partners and suppliers is vital for business success. This summary explores business communication methods.

How would you cope if your IT system failed or was breached? We cover the main IT security issues and how to protect against them.

Good IT management can help you choose, use and implement IT. Our overview helps you manage IT in a way that maximises the return on your investment.

IT support is vital if you rely on your IT system. But how can you set up an effective safety net in case things go wrong? We explore the options.

Getting the right IT is just the first step. Appropriate training, policies and working practices can help you maximise return on your IT investment.

Accounting software FAQs

23 FAQs on choosing and using accounting software in your business

  1. How can accounting software help us?
  2. What's the difference between cloud and desktop accounting software?
  3. Do we need to know about accounting to use accounting software?
  4. Do we need accounting software?
  5. What should we think about when choosing accounting software?
  6. Can we manage business finances without accounting software?
  7. Should we get an accounting package that does payroll, too?
  8. How can I make sure accounting software will be right for the long-term?
  9. Is free accounting software any good?
  10. Should we choose accounting software based on our industry or sector?
  11. Who should we talk to when choosing accounting software?
  12. What are the main benefits of using cloud accounting software?
  13. Is it safe to put my financial data in the cloud?
  14. Should we keep a local copy of our accounting and financial data, too?
  15. What happens if our online accounting software goes down, or our internet connection fails?
  16. Can accounting software replace our accountant?
  17. Will our accountant help us choose accounting software?
  18. Will our accountant use our accounting software too?
  19. When is the best time to switch to accounting software?
  20. How can I be confident my accounting software will be kept updated as legislation changes?
  21. Is it easy to switch to a different accounting software package?
  22. Who in our company should be able to access our accounting software?
  23. Do we need to keep records outside of our accounting software?

1. How can accounting software help us?

Accounting software can be the financial hub of your company. You use it to keep accurate financial records and perform tasks such as:

  • creating and sending invoices
  • creating quotes and estimates
  • recording expenses
  • completing tax returns
  • checking cash flow or profit and loss
  • creating budgets and forecasts

Accounting software can automate many of the repetitive, manual tasks involved in maintaining your accounts. For instance, many packages can be linked to your bank account and automatically check bank transactions against your records.

As well as saving you time, accounting software can give you a better understanding of your business finances. Because the software holds all your financial data, you can generate reports that show how your business is doing.

Finally, accounting software makes it easier to meet the legal requirements when running a business. For example, you can file VAT returns without having to do any manual calculations, or quickly access the figures you need to file your company accounts.

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2. What's the difference between cloud and desktop accounting software?

To use desktop accounting software, you must install it on your computer and run it there. All the data relating to your accounts is also stored on your computer.

Cloud accounting software runs on the internet. There's nothing to install on your computer. To access the software, you visit a website and sign in with your username and password. This means you can use cloud accounting software from virtually any device with a connection to the internet (including tablets and mobile phones).

Most businesses now use online accounting software rather than desktop software. Online software is generally cheaper and faster to set up, and easier to use.

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3. Do we need to know about accounting to use accounting software?

Modern accounting software is generally designed to be user-friendly, particularly if it is aimed at smaller businesses. It may take a while to get familiar with how it works, and perhaps with a few accounting terms, but you should not need specialist accounting expertise.

More sophisticated packages aimed at larger companies may be more complex and use more accounting jargon. But larger businesses often employ trained bookkeepers who have the necessary knowledge and experience.

You may find that you need some understanding of accounting to make the most of what the software can offer. For example, you may want to set your system up to break down expenses into the most important categories and to track key figures, such as the amount of working capital tied up in the business. It can be a good idea to work with your accountant to get things set up the right way from the outset.

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4. Do we need accounting software?

The majority of businesses, even the very smallest, use some form of accounting software. While it's still perfectly valid to run your business accounts on paper or using Excel, there may be advantages to switching to dedicated software. For instance:

  • Save time. Accounting software can automate many tasks you perform by hand, like checking bank statements or sending late payment reminders.
  • Make better decisions. Accounting software gives you easier access to information that actually means something, so you can use it to make decisions based on facts.
  • Fewer headaches. Good accounting software will help you meet HM Revenue & Customs (HMRC) requirements and keep you up to date as legislation changes. And, if you're ever selected for an HMRC audit, you'll have good records to show.

If you are registered for VAT, you will almost certainly want to use accounting software. Under Making Tax Digital, you must keep digital records and submit VAT returns online. Making Tax Digital is gradually being extended to other taxes.

Similarly, if you have employees, you will want payroll software to handle real-time PAYE returns.

It's usually more practical for the smallest businesses to get by without accounting software. But even then, it often makes sense to start using it. A cheap or free package will get you into good financial habits and make it easier to handle more transactions as your business grows.

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