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Why Do Small Businesses Need Accounting Software in UK?

07 April, 2023


As your business grows, so does the complexity of your financial data. Managing a company's finances on spreadsheets may be time-consuming and open to error, making it unreliable. To keep accelerating with today’s fast world company leaders, must look beyond spreadsheets. A scalable accounting system is essential for growing companies. 

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Nowadays people want their work to be done automatically and with less budget, so do the businessmen. Tasks like creating and sending recurring invoices, sending due payment reminders, managing inventory or stock, expense management and analyzing, creating profit or revenue reports etc, are time consuming and tiring.

Also, tax payment is a big task of every business owner. Especially in the UK all companies must have to calculate and pay tax and VAT returns to HMRC. To automate all time taking tasks and to avoid complexities of tax calculation and late payment, small businesses or companies can use accounting software in UK.

Benefits of Using Accounting Software

Reduce Paperwork And Increase Productivity:

There will be no one in 2022 who enjoys filling out papers. It takes a lot of time and labor to deal with paperwork. Why bother manually entering data when you can just click to produce a copy?

Accountants and bookkeepers spend a large portion of their time performing manual and repetitive tasks. For instance:

  • Creating bills and invoices for every client and sale
  • Keeping track of transactions and recording them in a journal
  • Reminding your customers of overdue payments 
  • Noting daily expenses and reporting to higher management
  • Keeping a record of Inventory and stock, then noting down their proportions

You get the idea. It's possible to automate nearly everything in this accounting process. This is where the accounting software works best for small businesses.

Better Accounting Security and Accuracy

There are several advantages to adopting accounting software, major is the ability to access all of the company's financial information online. In the cloud, all invoices, records, and entries are protected by many levels of encryption. Accessible to everyone who has the proper permissions.

The information on a computer's hard drive is not safe. Hard drives are notoriously fragile, they can be lost, deleted, or corrupted, rendering them useless.

A lot of time and effort was required by organizations to integrate accounting and financial data into their disaster recovery plans. As a result of this, costs went up and time was wasted.

But now desktop based accounting software in UK like Moneypex is password-protected by default in the majority of cases. Users can utilize this feature to prevent unauthorized individuals from accessing their personal data. Furthermore, storing your data in software makes it easier to find, search for, and retrieve files, as well as protects them from calamities like fire and flood. There are no natural disasters that can harm your data if it is only accessible online.

Inventory and Stock Management 

Stock and inventory management can be easily integrated into a decent accounting system. Helping you keep track of your inventory and your assets.

Accounting software works best for simple inventory management capabilities that automatically update to display the amount of each product you have on hand, what’s been sold. On top of that, it can anticipate when you are likely to run out of stock so that you may buy more things in advance.

Accounting software is a simple method to acquire precise, real-time information on your stock levels, instead of depending on error-prone human entered data for small and large businesses.

Additionally, you can manage inventory expenses with accounting software, which makes it easier to take stock and compute asset depreciation.

Real-time Reporting

Accounting Software in UK

Preparing reports with spreadsheets is quite demanding since you need to aggregate data and add formulae manually to make each report. But accounting software creates reports automatically, saving your time and effort.

Accounting systems may give precise information on your company processes and help you track the money movement in your corporation. You may receive a comprehensive view of your costs and income at any moment.

This can make it easier for you to figure out how much money you're making and who your most valuable customers are. The level and breadth of actionable reporting provided by leading accounting softwares are solely determined by the data you place into them.

Integrated reporting capabilities in accounting software allow organizations to keep tabs on their cash flow. It is possible to prepare profit and loss statements and balance sheet reports to assist you in better understanding your company's important financial elements, drawing conclusions, and making well-informed decisions to guide your firm in the proper way.

It also automatically aggregates information on other vital areas of your organization including sales, purchases, taxes, inventories, and projects. You can quickly produce reports, make choices, and keep your business healthy with all of this data.

 If your reporting needs are more particular, you can generally filter the data or add more detail to tailor reports and run these reports again in the future.

In summary, these reports may help you make informed decisions, and manage your organization more efficiently and successfully.

Tax Compliance Simplified

When dealing with different tax rates, accounting software can help you calculate taxes more quickly and precisely. Additionally, it may help you comprehend your taxes by providing tax summary reports that will assist you in remaining organized and prepared for tax season.

It is intended to comply with local tax requirements and to make tax preparation easier. 

With correct accounting records, current financial statements, and reports, compiling the documentation and information necessary for tax filing is a breeze.

Moreover, accounting software incorporates UK-specific tax requirements, letting you focus on building your business rather than worrying about the VAT returns

Bank Reconciliation

Bank reconciliation is a critical accounting function for any business, and accounting software automates the process. By directly connecting your bank account to your accounting software, you may immediately import statements from bank feeds into your accounts. 

It might take hours to collect data from different platforms, such as bank accounts, credit card accounts, and payroll systems. Accounting software can put an end to downloading financial data from each source and spend time entering it.

Custom criteria and bank rules can be configured in accounting software to automatically categorize and match incoming bank transactions. Once your transactions are matched, all that is required to reconcile your accounts is to validate and confirm them. It simplifies bank reconciliation, ensuring that your organization is audit-ready throughout the year.

Moneypex Accounting Software, for Better Business Future!

That's a wrap! You should now be aware of the benefits of using accounting software. Modern industries are expected to function digitally with speed and precision in the period of COVID-19, as given that most individuals are working remotely nowadays. 

Moneypex accounting software can manage financial data, from simple invoicing and billing to tax computations and project management online or offline. Additionally, HMRC has authorized this accounting software, so you can easily pay VAT return to HMRC.

Furthermore, it aids in managing clients, reconciling bank accounts, and generating analytical financial reports and much more that assist your business to expand effortlessly and continually.  You can also take advantage of its cloud and mobility facility and access your business related data anytime, anywhere. Flexibility! 

Do you want to reduce the amount of time you spend on financial management? Cloud-based accounting software like Moneypex is the best solution to your business financial and other handlings in 2022.  

Get started for free or Get a free demo from our experts on how this system can work for your business.

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Moneypex team is here to give you the best tips for starting, running, or growing your small business. Written for self-employed individuals and small business owners, Moneypex provides insights into the latest trends and expert advice.