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What does accounting software do?

How does accounting software work exactly and what features does it offer? There are many different ways in which accounting software can optimize your business, depending on its main features and objectives. From simplified invoicing to complex tax reporting, accounting systems come with all sorts of extras that are not even feasible without an appropriate system.

Here are some of the features of accounting software

1) Accounting :

Accounting is the main component of each system in this category and the one you should be looking for first when choosing a reliable solution. What we have in mind by ‘accounting’ is general ledger, fixed assets, accounts payable & receivable, and bank reconciliation. These are, of course, the basic and most important ones, while advanced systems have much more bells and whistles to offer to their users.

2) Billing & Invoicing :

There are accounting systems exclusively devoted to billing and invoicing, but most of them still treat similar operations as an integral module of any finance operation. Thus, they let customers automate mundane collections, adjust operations to new and effective payment methods and industry standards, and prepare accurate and in-time invoices for their clients.

3) Budgeting and Forecasting :

This is also a common bundled module in most accounting systems, which calculates and interprets finance performance for the current year and helps estimate the budget of the upcoming one. Using it, companies can prepare their estimates and set up feasible and optimistic sales targets.

4) Management of fixed asset :

Both as a separate tool or an inclusive module, fixed asset management helps manage financial data much more accurately. The module combines features such as audit history, cost records, depreciation calculation, resource allocation and many more.

5) Payroll management :

With an array of payroll features, you will be able to calculate and process employee payments, prepare and print their checks without delays, and respond to all active legal and tax commitments without errors. There will be systems out there exclusively devoted to payroll management, used by enterprises and high-tier performers to remind them of their financial obligations.

6) Project accounting :

Project accounting software is usually packed in separate systems that represent the accounting version of vertical industry software. They are most welcomed by construction operators and software developers, where both costs and applicable rules differ from one project to the other. The main capability of this software is to estimate and handle overheads and costs related to labor, material, and equipment, in line with all other features frequently met in accounting systems.

7) Fund accounting :

These features are to be found in accounting software designed for government agencies and nonprofit organizations and include tracking donation expenditures, grant management, GASB (governmental accounting standards board) regulations, and a special suite of financial reports.

8) Inventory management :

Inventory management is a specific toolkit developed for stock control, and where you will find all the necessary tools to give your business a higher shelf-life product line. This means you will be able to control the availability and movement of your products and avoid all sorts of delivery issues such as overstocking or understocking.