Should Your Small Business Use an In-House Accounting Software?

When running a small business, there is the question of whether you should hire an accountant or do the accounting yourself. Most of the time it depends on the size of the company. There is also a hybrid position where the bookkeeping is completed on an accounting software and then it is verified by an external accounting firm to save some money. Today, we will discuss the reasons why your small business should use accounting software solutions in-house instead of hiring a third-party accounting firm.

Accounting Solutions are Now Designed for Small Businesses

Over the past few years, the accounting software packages have evolved over time to where solutions are now available that offer different options based on the business market. There are several accounting solutions options now that make it easy to support small entrepreneurs that are just starting out with a small team, or to assist freelancers that need help managing their financials.

The difference between software solutions in the accounting world means that when you choose the right package for your situation, you are helping your business.

Ability to Stay More in Control

If you are someone who likes to have control in all aspects of the business and do not like letting go, it is recommended that you perform in-house accounting. When you hire someone that is either part-time or full-time to manage the accounts internally using an accounting package makes sense.

To Simplify the Financial Management Process

When there is a need to focus on the core aspects of the business to ensure it is successful, running the accounting is a distraction. Using an accounting solution that is made to simplify and minimize the time involved in managing the bookkeeping to produce basic reports and offer digitized billing reduces the processes involved. Streamlined accounting is recommended when the business owner and the team is restricted to the time available e in the business day.

Cashflow is King

The cashflow statement is a document that allows the business owner to understand how the money is flowing into and out of the business. Not every financial statement is as useful. A balance sheet and profit and loss statement have their place but do not provide a way to monitor the monthly changes and trends over time in the same way.

Depending on the industry the business is in, the cash movements reflect something different than what was on the other financial statements.

The Bottom Line

It is possible to hire an accounting firm that uses software and produces report. Reports have similar information, but it is not a carbon copy between software packages. Unfamiliar accounting packages can cause unnecessary confusion. It is important that you pick the software that provides intelligible reporting. Entrepreneurs who prefer to have the latest financial information, more control, and few delays, the in-house accounting solution is the best.