Why should I use accounting software over spreadsheets

Spreadsheets vs. Software: Navigating the Future of Accounting Practices

We’ve come a long way since the days of dusty ledger books and adding machines. However, even in the past decade alone, some accounting professionals have been reluctant to adopt the newest accounting software despite huge advances.

Let’s take a look at why you should consider waving your Excel spreadsheets goodbye and embracing the next generation of accounting technology.

Can I continue to use spreadsheets in my accountancy practice?

The spreadsheet method has served accounting professionals, bookkeepers and small business owners well for decades now.

So, it makes sense that some remain loyal to spreadsheets. This is especially true if you’ve set the templates up yourself, as you’ve likely designed them to fit exactly to your specifications and ways of working. If you’ve been in the accounting business a while, you’ve probably developed customisations and shortcuts that save you time and effort – that’s what programs like Excel are designed to do.

However, there’s plenty of room for error with spreadsheet working – from the initial setup, mistakes in your data entry and errors in merging data – and it can be a time-intensive process to prepare financial statements this way.

But is accountancy software really any better?

What is accounting software?

Accounting software is essentially online accounting tools with cloud-based storage. These accounting programs can run hundreds of different functions in just a few clicks, with many fully automated functions offering unrivalled accuracy and saving you and your clients precious time.

Big names include Clear Books, Xero, AutoEntry, QuickBooks, FreshBooks and Sage.

Unsurprisingly, these sophisticated accounting systems come with many benefits compared to traditional Excel-based accounting methods.

Let’s take a look at some of them.

They’re fast

Once you’ve got the hang of it, accounting software can shave hours off your working day by completing previously time-consuming tasks at a high speed. Certain processes which used to be laborious and error-prone, such as pulling data together from different sources, can done in just a few clicks.

They generate reports in an instant

Common accounting reports, such as daily, weekly or month-end reports, as well as income statements and cash flow, can be run at the click of a button with accounting software. You simply select the report you want to run and the date range before hitting the button to generate it. Accounting software also allows you to create bespoke reports, which can be saved and used whenever you need them.

They’re in sync

Rather than having to compile data from various sources, a good accounting software solution should have syncing capabilities with other software. By interfacing with other platforms, such as your client’s bank account, HMRC, Companies House and payroll software, you can pull information together without needing to log into different platforms and do it manually.

They’re accurate

Providing the data is correct, accounting software should be 100% accurate. When you make a change, it should be updated across the board for that client, so you don’t need to enter it more than once. By doing away with the need for double entry on data, accounting software pretty much guarantees error-free calculations without the need for cross-checking.

You and your clients are on the same page

A huge benefit of accounting software is that you and your clients can see the same information. With the correct permission, you can log in at any time to see what your client sees – and help them with any queries they might have without you having to bring each other up to speed ‘off-line’.

Filing taxes made easy

Come tax season, your client is relying on you to prepare and submit their accounts on time. Most software can be linked to HMRC accounts, making the previously painstaking task of preparing financial statements much faster, reducing the chances you’ll be burning the candle at both ends for weeks each year-end.

They give a clear picture

One of the greatest benefits of accounting software is that it offers full visibility of a business’s financial position, not just its cash position. Unlike the more static Excel method, accounting software doesn’t just record data. Still, it analyses it, too, meaning you can generate insightful reports about a business’s financial position in a matter of seconds.

It’s on-the-go

Simply by connecting your smartphone or tablet to WiFi, accounting software allows you to perform a full suite of accounting functions without needing to be at your desk. This is great if you’re out and about and a client needs an answer in a hurry or if you’re working remotely.

ICPA members benefit from accounting software

ICPA membership comes with some serious benefits, including huge discounts on subscriptions to industry-leading accounting software tools.

These include:

Clearbooks

ICB and ACCA-accredited Clearbooks bring clarity to business finances for both you and your small business clients and are MTD-compliant. This award-winning software has automated tools, including bank feeds, payment collection, a mobile app with receipt capture and an integrated dashboard with tools such as asset management.

BTCSoftware

Designed to help accounting professionals support their clients as well as ensure tax compliance and accounts preparation in their own business, including Self Assessment and Corporation Tax. BTCSoftware comes with practice management and company secretarial functionality to streamline administration in your practice.

AutoEntry by Sage

AutoEntry extracts information from financial documents like receipts, invoices and bank statements and publishes it in your financial software, meaning no more manual inputting of invoices or receipts and taking away the hassle of manual data entry.

Inform Direct Company Secretarial Software

Designed to streamline workflow and offer clients a first-class company secretarial service, this comprehensive tool includes confirmation statements, share allotments, director and PSCs company formation, and instant generation of compliant supporting documents.

QTac payroll

HMRC tested and recognised that this software takes care of payroll, from RTI submissions to workplace pension auto-enrollment to payslips. They come with outstanding customer support, with ICPA members relying on QTac for rapid and accurate payroll solutions for years.

Time Tracking Software

Time tracking software by Tally Pro automatically identifies ways to boost your practice’s profitability and efficiency, and it’s designed especially for accounting professionals. Tally Pro provides up-to-date metrics on a business’s position and profitability and also handles invoicing, expenses and reporting.

Should I get accounting software?

While the use of accounting software remains optional, we think it’s one of the best decisions you can make for your accountancy practice. The bottom line is that accounting software helps you to support your clients through the ups and downs of their business.  Saving you time, money, and effort will help your accounting practice flourish in the process.