It is very difficult to maintain proper records without a proper structure of it especially in case of big companies; however, with the help of certain application software that contains modules such as accounts receivable and payable trial balance and payroll, it enables the user to maintain correct records of transactions. This is known as accounting software. One can either buy this from a third-party vendor or can create their own software based on the company requirements or can modify the purchased software to fulfill the needs regarding their system of accounting.
Some of the common modules of such software, that are bought by the best accounting firms for small businesses are as follows:
- Accounts receivable: it is a claim in which legal enforcements tend to get the vendor to pay the supplier for the goods that they have purchased.
- Accounts Payable: In this, the company pays the bills and the money that it owes to other organizations or vendors.
- General ledger: The Company’s account such as assets, liabilities, owner’s equity, revenue, and expenses are maintained in this book of records.
- Billing: It is a document or an invoice that a seller produces to the buyer in which the details of the goods such as quantity, price, and product are mentioned.
- Stock/inventory: In order to sell the goods again the company holds such products which are known as inventory.
- Purchase order: Before initiating an order, the company issues a formal document that is the first official offer to the buyer known as a purchase order.
- Sales order: It is the record of the orders of the vendors to the suppliers known as sales orders.
- Bookkeeping: All the details of the payments made and collected by the vendor is known as bookkeeping.
Apart from these, best accounting firms for small businesses, have some non-core modules in the software that are as follows:
- Collection of debt: it is the record of unpaid or overdue bills maintained by the company.
- Electronic payment processing: The system to settle a transaction is by following certain rules is known as electronic payment processing.
- Expense: it is the record of expense related to the employees and business.
- Inquiries: Finding any information in the software without any addition or editing is known as inquiries.
- Payroll: The break-up of wages, salary, and taxes related to them is known as payroll.
Some other non-core modules are timesheet, journals, etc. that are included in this software making it very easy for businessmen keep a track of their accounts.
In order to survive such a competition as we face today, it is important to keep pace with the latest trends and technologies. This area is facing changes on a daily basis which is why people need to update their knowledge so that they can be on the top of the list. Every company has a separate department because it is impossible for a single person to handle all the different verticals such as operations, finance, accounting, etc.
Large companies find it very difficult to keep track of the payment it has to make to their employees. This is because there are various breakups of the salary of each employee and the number of employees being more than a thousand; it is a tedious job to calculate individual wages. Thus, giving rise to the need for automation of the process where all the calculations are done automatically by a computer. Such an application is known as payroll software.
The benefit of the same is that it minimized the errors that we make during manual calculations and reduces the time and effort. In a few cases, the company assigns this job entirely to the third party who deals with this software.