Bookkeeping is an absolutely essential, often underappreciated element of running a business. Small business owners should be diligent about bookkeeping to avoid common tax mistakes; freelancers should care about bookkeeping too, and that’s becoming more relevant as more people gain employment in the gig economy.
Keeping track of your income and expenditures might seem tedious, but it’s well worth it; what’s more, software is making it easier than ever to track your finances. Those who aren’t using cloud bookkeeping software should start using it right away - software like QuickBooks Online can really improve your businesses’ efficiency. Here’s why.
Access Your Files Anytime
Long gone are the days of needing to pull out every document from your filing cabinet in order to crunch numbers; bookkeeping software holds all of your financial information for you and can do a number of relevant calculations for you automatically. While you should continue to keep and manually sort physical copies of your financial documents, online bookkeeping software allows you to store these same documents digitally, no matter where you are in the world. That’s especially useful if you incur expenses on a business trip - with online bookkeeping software, you can take a picture with your phone and upload the document to the software. You can also quickly review and update your bookkeeping from your laptop.
Grant Access to Others
There might be a number of folks on your team who need access to financial documents; with online bookkeeping, giving them access to these documents is as easy as a username and password. This is incredibly useful if you have a team of people living in different places - remote work is becoming more popular, and the ability to access these documents remotely can be a huge boon to current and potential future employees.
Another feature of online bookkeeping is the ability to give your accounting team unprecedented ease of access to your financial documents. Rather than having to scramble to find the appropriate documents at tax time, your accounting team will automatically have access to all the files and information you’ve uploaded to the software - it also makes it easier for them to communicate with you if something is amiss.
Ease-of-access is important, but automation is the real killer app of online accounting software. The features of QuickBooks online are pretty incredible. Take, for example, tracking miles - what is widely considered to be one of the most tedious bookkeeping activities is made simple. You download the QuickBooks app, it uses your smartphone’s GPS to track your miles, and it automatically logs them. That would be impossible without connecting to the cloud; now it’s easy.
There’s a number of other financial transactions that are automated through bookkeeping software. You can, for example, schedule bill payments using this software, and you can pay multiple invoices simultaneously - those payments are automatically logged into the software, so the books stay balanced. You can also integrate your software with your point of sales systems, so any income you receive is also automatically logged.
Almost any income and expense can be tracked using online bookkeeping software. You can automate tax calculations on payroll for your employees, and integrate your payroll with the software. You can create invoices, schedule automatic payments, and much more. The software that’s currently available can perform the tasks that you would have needed several pieces of software to do in the past - all because we can transact online.
Secure Your Documents
One of the more common worries about cloud accounting is security - there are some folks who hear about hacks where financial information was stolen, and that can make them reluctant to transition. Fortunately, online bookkeeping is incredibly safe - in many ways, it’s safer than traditional bookkeeping.
With traditional bookkeeping, you’ll often only keep one copy of all of your documents, making them susceptible to damage from all kinds of risk, including fire, water damage, theft, and degradation. Keeping documents on the cloud acts as a backup, so if your physical documents are ever damaged, you have digital copies you can readily access and print out.
The security fears about online bookkeeping are overblown. Most of us already bank online, we’ll book an appointment online, and we’ll send sensitive emails to business clients without sweating for a second - online bookkeeping is as secure, or more secure, than any of the above. You can enable things like two-factor authentication in order to ensure that no one outside of those with approved access can use your bookkeeping software, and all the reputable online bookkeeping companies have taken steps to make their systems extremely secure.
The best part about online bookkeeping is how cost-efficient it is. That’s in part because it increases your efficiency so drastically over traditional bookkeeping options that it saves you money, and in part because the software can be customized to suit your business' needs. You won’t necessarily need all the bells and whistles available in the top-shelf version of every product, but that’s okay - if you ever do, it’s easy enough to upgrade while transferring over all the relevant information.
Some Final Thoughts
Online bookkeeping software can be very sophisticated - this complexity is its biggest draw, but it can be daunting for someone who has never used the software before. The user interfaces are usually very well thought out and quite intuitive once you know the lay of the land, and a lot of work can be automated if you know what you’re doing. We can help you choose the right bookkeeping software for you, we can help you set up the software, we can help you navigate the software, and we can review your bookkeeping for you. Get in touch with us; we’d be more than happy to discuss your business’ needs and find the right solution for you.