Well, isn’t that a loaded question? When you consider the ease in which computer accounting software has made bookkeeping for businesses of all sizes, you would think there would be an easy answer to this. However, many small business owners see digitizing accounting as a huge expense and time-consuming process that could take considerable effort to recover from. However, with more and more software programs being developed just for small business, it is getting much easier to make the switch. But before you do, let’s take a look at the difference between traditional and computerized accounting processes to help you truly decide.
1. Costs
There is no denying that it wasn’t all that long ago when computers were so costly that only the biggest and strongest businesses in the world could afford them. Plus, computers at that time were massive. Some took up the entire space of an office and sucked enough power that energy bills soared. However, even at that time, the ways in which computerized accounting streamlined the mathematical part of determining the financial health of a business made the cost seem minor in comparison. Nowadays with new technology always moving forward, the cost of computers has dropped considerably as much as the size of the equipment needed to calculate the bottom line. With the affordability of computers and accounting software and QuickBooks in 2019, this allowed medium and small businesses an opportunity to jump on board the wave of computerized accounting.
2. Speed
When was the last time you sat down with a pen and paper and attempted to calculate all the expenses from the last month for your business? Sure, you may have done this in the beginning and even with the assistance of a calculator you will be able to speed up the process. However, nothing quite matches the speed of computerized accounting. Essentially the computer software program contains the template and all you have to do is input the numbers. Within the blink of an eye, totals are tallied. Plus, with a computerized system in place you can run and print various types of reports with as much speed. The instant availability of this data provides fast snapshots related to the overall financial health of your business and different reports can reveal issues.
3. Accuracy
Nothing can be more painful than manually entering a few hundred invoices and accounting pieces of data in a ledger manually and losing your place when the phone rings or some other distraction pulls you away from your task. It doesn’t matter how focused you are, a glitch is a glitch and with computerized accounting, the only glitches you will encounter will somehow be traced back to the human entering the data. Aside from that, when the data is properly entered into a digitized accounting process, the results are incredible. If you are in need of razor-sharp accuracy when it comes to the numbers part of your business, nothing comes close to the results of computerized accounting programs. Even the guy down the hall with the photographic memory is going to slip once in a while. Your computer, provided it remains healthy, will never let you down when you are in need of up-to-date and current financial information about your business.
4. Backups
There was a time when a backup in the non-computerized accounting department was a new notepad that had not been used yet. Even with the ability to photocopy or scan pages to keep on file in case something happens to the original ledge entries, recovering that lost data involved a long and involved process of re-entering each and every entry by hand. With a computerized accounting system backups are often conducted automatically and even if they aren’t, it isn’t much work to implement. Also, retrieving backed up data is a snap with storage options ranging from internal and external hard drives to cloud applications where your accounting data will always exist, be backed up and saved for when you need to use it again. Often this is achieved with a single click of a button on a keyboard and nothing more.
Still Deciding Whether Or Not To Digitize Your Business Accounting?
There is no doubt that for some small business owners the switch from traditional to computerized accounting may appear to be a lot of work. In all honesty, for some businesses, it will be. However, by using small business accounting software like ZipBooks, you will be able to adapt the operating system to work for your specific business even if it happens to be a very small home-based or single entrepreneur operation. The idea behind digitizing the accounting part of your business is to make it easier on you, your staff and the agencies that require information from your accounting department.
Plus, if you are a proprietorship, a computerized accounting department will lighten your load and permit you the time you will need to focus on the actual operation of your business instead of having to split it between bookkeeping and operating. When you end up in a situation where you must juggle both, something is going to give. When you digitize your business accounting you are not only saving yourself time an effort, you are putting your business on pace with the changes in new technology. The new technology will continue to be a driving force in the world of small business well into 2019 and beyond. You’ll find it will be better to be on pace with this trend than it will be trying to catch up when your business has grown and you can no longer juggle the time required to keep your business finances in order and to keep your actual business open and functioning as it should.
