How Does Accounting Software Improve Financial Performance?

As a business leader, there’s one thing you’ll always want regardless of industry, and that’s growth.

Improving financial performance is one way to make this happen. Accounting software helps makes sure efforts towards this are speedy, streamlined and seamlessly integrated.

In this article, we’ll be going through some of the ways investing in accounting software can give your business’s financial performance the lift it needs – and maintain it in the long term, too.

Why Use Accounting Software?

Streamlined Financial Processes

The speed of your business’s financial processes directly impacts the productivity of a team. Previously, documents may have had to go through several people before getting approved. This doesn’t only take longer – the administrative costs can also pile up. All of this affects your business’s bottom line. Accounting software makes these processes far less time consuming, whether through rapid order entry, automatic reconciliation, or expense tracking – saving you some pennies along the way.

Automation

If all your team knows are manual processes, there’s a good chance that they’ve factored the extra time spent on them into their working day. This has an obvious downside: for every extra minute devoted to tasks like invoice processing, that’s a minute they’re not spending on helping the organisation meet its goals.

Accounting software has automation built in – so statements that would have been filled in by a person can be done with the click of a button. You can also assign workflows to specific processes. This means you also save time in having to check documents for errors – time which you can devote to tasks that actually make your company do what it needs to, faster.

Real-Time Insights

As we alluded to earlier, a manual process can have multiple people needing to sign off on it. We know this causes problems for a business’s time management, but it can also affect the freshness of financial data.

Traditionally, compiling data would take hours at best, and days at worst. By the time the statistics get in front of your fellow executive leaders, there’s a good chance they’ll be out of date. Though the difference may be negligible, business leaders understand how even the smallest changes can have significant impacts.

Unlike its manual counterpart, modern accounting software is set up to be constantly up to date. This isn’t just good news for board meetings. It also means your team can be more confident in using this data to inform their business decisions, helping to build a stronger, more financially sound company.

Forecasting and Planning

Following on from the point above – another way that accounting software can improve financial performance is through its forecasting. With the security of knowing you have the freshest data, you can then use it as a basis for multiple financial reports. The ability to split these reports – by region, sales representative, or many other metrics – opens up your business to new avenues of opportunity.

Integration with other systems

Complete business visibility. It’s the ultimate goal for every leader, but achieving it is often easier said than done.

In many cases, accounting software is built to integrate with other systems that you already use. They might be ones you haven’t even thought of in this context – like payroll or timesheets. Accounting software links all of these systems. Instead of pasting data between programmes, you and your team get a comprehensive view of the business’s financial and operational data. Your departments can make better decisions, together.

Scalability

While we hope you haven’t encountered this, we’ve heard plenty of examples of businesses whose accounting has struggled to keep up after periods of significant growth. This is a foregone conclusion with manual accounting – after all, you can only add so many pages to a paper journal!

Though businesses aim for growth, they probably don’t have the resources to buy a new piece of software every year. The makers of accounting software know this – so they build their programmes with scalability in mind. One piece of software is flexible enough to handle increased transaction volumes and complexity without needing more infrastructure. You can work with a system that’s able to expand as you do, rather than struggling against one that’s not built for your current business.

Of course, no solution is a silver bullet when it comes to financial performance. It will fluctuate regardless of what you do. But successful business leaders are all about giving a company direction. Accounting software does that – letting your team make better use of their data and their time. It’s not just a tool, but a catalyst for driving efficiency, and supporting long-term business success.

Sage software is the all-in-one business management solution trusted by over 9,000 businesses in the UK. Contact us today to learn more – call 01332 959 008, or use the enquiry form.