A piece of paper is generated for every transaction that takes place in accounting and business. Accountants even prepare internal vouchers for various procedures. Over time this can lead to voluminous amounts of paper. These have to be stored, leading to non-productive use of office space. The other downside is that if you wish to find a particular document you have to spend time searching, leading to wasted efforts. Digitalization in accounting should be number one priority, particularly if you are looking to get accounting and bookkeeping done by accounting outsourcing company.
How accounting outsourcing company can help digitalize
Paper use is unavoidable. However, you can digitalize everything to ensure digitalization in accounting. If you do not know how, your accounting outsourcing company can assist. You can transition to digitalization in accounting this way:
- Make use of modern accounting software, possibly cloud based, so that you can upload or download documents and your outsourced accountants can work on digital documents and make electronic entries.
- Avoid printing out receipts and invoices. Instead, convert to PDF through the accounting software and email them instead of sending printed documents through snail mail. An APQC survey shows that it costs about $ 12 to process paper printed invoices.
- Convert paper documents you receive from suppliers to electronic format through the appropriate standalone software with optical character recognition or use accounting software that has this capability. This way you and your accounting service do not need to access paper documents. They are all available in one place. Plus, when you convert to electronic format, you can index them and searching becomes easy.
Digitalization in accounting should be number one priority. There are convincing arguments in its favor.
Governments are putting in place systems that impel you to use electronic documentation. In the US the government modernized the Tax and Customs Administration followed by IRS, Digital bookkeeping system and electronic invoice as well a host of other finance and compliance matters. You will need to submit electronic documentation to stay compliant and do so within a prescribed time limit.
You should give digitalization in accounting top priority because, these days, businesses need to be agile, nimble and flexible. If there are changes taking place and you must take fast decisions then you will need to have up to the minute information on cash flow and a picture of your profit and loss.
Digitalization in accounting means you can have the system generate whatever statements you wish, and, in advanced systems, play “what if” scenarios and carry out future projections. You do not lose opportunity. At the same time, when there is speed, you know immediately if anything is going wrong and you can take corrective action.
Precision and accuracy
The cards fall into place. Think of digitalization in accounting as a system of extreme precision and accuracy. Humans can make a mistake in entering the data incorrectly and post incorrectly. However, do it electronically and one entry at one place is reflected in all relevant sections. A payment made will reflect in the bank and the creditor account. Likewise, payment received will show in the bank account and to the credit of buyer besides other sundry relevant heads. There is no scope for error.
Manpower is expensive
Manpower is expensive and time consuming too. Digitalization in accounting will cut down expenses of maintaining personnel and also do away with delays that take place during manual accounting procedures. You can have just one accountant in the accounting outsourcing company handling your accounts and everything is kept up to date at a low cost.
Generate your reports
In an enterprise you have the owner who may want a report with a particular set of figures and possibly balance sheet and profit and loss account at the end of each week or each month. Sales managers may simply want a report that gives details of bills raised and outstanding so they can follow up. Purchase manager may wish to know about bills payable. Marketing may want reports that will give them a picture of the health of the company and help them to take informed decisions for growth. Should each department ask the accountant to generate such reports it would take a long time. Digitalization in accounts translates to ease of generating insightful reports plus the benefit of analytics in a secure way.
Is it difficult to digitalize?
For the present and future you can start using cloud based accounting system handled by outsourced accounting but what about companies or small businesses that have been following the paper based method? Engage accounting outsourcing company for digitalization in accounting. Your previous year or last two years’ books can be digitalized in addition to the current year. Finacc Global handles digitalization in accounting and paves the way for transformation of your business.