Published on January 12th, 2022 | by Sunit Nandi0
Why We Need to Develop Accounting Software
Today, there are few areas of activity that have not undergone reorganization due to the introduction of automation solutions. The owners of companies got the opportunity to expand the scope of their business without the need to attract new human resources. In addition, the risk of human error has also decreased: unlike a person, a machine cannot mix up numbers or forget to fill in some details. Specialized applications are gradually finding their application in the field of accounting. In particular, with the help of automation, you can optimize the work of various sections of this business sector:
- carrying out banking operations;
- carrying out currency operations;
- handling operations with the employees’ salary;
- calculating budget;
- keeping records of the cost of products or services conducted by the enterprise;
- performing financial transactions with third parties;
- accounting consumables and raw materials used in production, etc.
Below we will analyze all the reasons for developing such software, as well as introduce you to the basic features of accounting software.
Why Do Many Business Owners Implement Their Own Accounting Solutions?
Accounting is a fairly specific industry that requires an individual set of features for almost every single type of business. That is why, despite the wide range of ready-made accounting software products, many medium and large businesses turn to software companies to create accounting software that would satisfy their individual needs. As a result, the output of such a collaboration is a solution that can be further scaled and reconfigured, depending on the current business needs.
As for ready-made solutions, the practice shows that they are rarely effective in these cases. Such products are created to be extremely versatile, so they are completely devoid of functions applicable to a particular type of business.
Thus, the costs of developing and maintaining accounting software very quickly pay off (within 1-1.5 years on average, depending on the profit of your business).
What Are the Benefits of Customized Accounting Software?
Now, let’s find out what benefits your business will enjoy after implementing custom accounting software.
Saving time and minimizing human labor
In modern realities, the question of automating everything that can be automated is especially important. In particular, automation through the implementation of software helps to increase the productivity and efficiency of internal company processes. If we consider customized software in terms of optimizing the work responsibilities of the accounting department, it will help business owners to solve several problems at once: reduce the workload on employees, speed up the daily tasks, centralize the management of the company’s financial turnover, and minimize the need to expand the staff of this department as the company is scaled.
Acceleration of data processing
More and more companies have to deal with Big Data (for example, during a financial transaction and receipt or withdrawal of funds). These are colossal streams of information that arrive to the company in an unstructured form and need to be processed quickly and efficiently (that is, with minimal expenditure of computing power). Of course, even a whole team of experienced accountants will not be able to compete with an application that only takes a couple of seconds to process the stream of information.
Reduced chance of error
Unfortunately, none of us are immune to occasional distraction. This is one of the main reasons of errors in calculations, and one of the most difficult to eliminate. Such mistakes can cause huge losses to companies and knock them off the right course for further activities (we are talking about errors that can occur in financial reports, which then form the basis for drawing up business strategies). Customized software will solve this problem once and for all, because a computer will never allow mistakes in its work.
Centralized data management
When data is spread across multiple computers, it is very difficult to synchronize. Moreover, it also happens that a computer breaks down and the stored information is lost. In order to protect your business from such accidents, you will need a customized solution that runs from the cloud and that can be managed centrally. In this case, all information will be synchronized as changes are made to the database, which, in turn, will ensure increased fault tolerance of the entire system.
Types of Applications for the Accounting Department
When asking yourself the question: “How to develop accounting software?”, you need to understand the ways it can be represented. Despite the fact that most companies buy all-in-one accounting solutions, there are several specialized types of accounting software:
- Databases. The database is probably the easiest format for accounting applications, which is ideal for small businesses. Presented in the form of structured tables, such software will ensure convenient handling of information stored in the accounting department, and provide optimal conditions for the staff of this department to operate it. Some of the main features of such applications are the advanced search functions, filtering and sorting, synchronization (with an Internet connection), as well as the differentiation of access rights;
- Applications for solving commercial problems. Reporting and analytics are the two main tasks that underlie the activities of employees of the accounting department. As practice shows, universal e-commerce products rarely meet the expectations of their users and, as a result, the templates for the reports they contain have to be seriously modernized. If you do not want to bother with this adaptation and would rather devote your time and the time of your employees to more serious tasks, it makes sense to think about developing customized software;
- Applications for automating business processes. Finally, automation applications are something that will help keep your staff the same, but at the same time significantly expand the scale of your business. As a rule, in this case, the functionality for the accounting department is only one of the components of such a comprehensive software, and it comes in the format of ERP-systems.
Development of Accounting Software: The Main Stages
Once you have decided on the format of the accounting software, you will need to understand the stages of its implementation that will form the cost of its development. So, let’s consider the main processes that will accompany the creation of your software product:
Agreeing on the requirements
Usually, any development process is preceded by a thorough discussion of business requirements for the application. This includes not only the current tasks it needs to perform, but also the prospects for scaling, both vertical and horizontal, which will require minimal costs on the part of the business owner.
After agreeing on the requirements, the development and design team starts to develop a template: an outline of the future application (or rather, its interface), which can be shown to the customer so that they can either greenlight further work on the project, or adjust some aspects. The main goal of the template is to reduce the spend of time and money until the customer and the developers come to a consensus.
Implementation of the functionality
After the visual and logical presentation of the functionality has been found satisfying by both the customer and the developers, the latter proceed to creating a full-fledged software product. This can be either an MVP (the minimum viable product that is created so that the customer could use it to solve the basic needs of their business and later increase the functionality without much damage to their budget), or a solution with a full set of functions that were listed by the customer at the beginning. The latter option obviously implies much more serious capital investments and time expenses.
Support and maintenance
After launching the application, you need to be prepared for the fact that you will have to regularly allocate a budget for the rental of server capacity. In addition, in case the application needs to be enhanced with new features, you will once again have to resort to the help of developers and, accordingly, allocate a certain part of your company’s budget for this.
What Should Be the Functionality of Accounting Software? Studying This Question from the Point of View of MVP
Finally, it is time to find out what functionality the average versatile software product for the accounting department should possess.
The user’s account is perhaps one of the main elements in any accounting application. It is from here that the user gets access to its functionality, and it is through it that you can assign separate access rights for different employees. From the developers’ side, it is very important to make this part of the application intuitive and easy to learn for the ordinary PC users, taking into account the complexity and vastness of the actions available. We strongly recommend also discussing with the developers the aspect of two-factor authentication in the user’s account in order to protect your corporate data from leaking.
Functionality for data processing
The primary task of this kind of functionality is the end-to-end control of the income and expenses of your company, as well as providing comprehensive statistics for any period of time that interests you. In addition, it will provide you with access to the contacts of your customers, which will allow you to integrate them into your CRM. That is why these functions can be actively used outside the accounting department, helping to establish customer interaction processes for companies in which the initial stages of the sales funnel are handled offline.
Obviously, your application cannot do without the functionality that performs calculations – whether it is the calculation of the funds spent during a certain time period, the employees’ salary, VAT, or loans. This will help to avoid any errors and maintain maximum data transparency.
It is on the basis of the reports that the amount of profit, income, turnover and other financial parameters important for determining the future business strategy of the company is determined. The presence of built-in customizable templates for generating reports will aid your accounting department at especially crucial periods (for example, at the end of a month, at the end of a quarter or at the end of a year). The function that converts the reporting data into infographics will also come in handy to help you navigate the collected information for a certain time period even faster.
Integration with third-party solutions
As we have mentioned before, most accounting applications work in conjunction with a number of third-party business solutions. The most typical of them are software products from the list of Google web services, and Microsoft Office 365. It also makes sense to develop or find a ready-made solution with the integration of the CRM that your company uses or plans to use. This will ensure the continuity of workflow and the end-to-end automation of everyday business tasks.
Since access to such software products is usually provided to several employees at once, it is very important that each of them has an idea of who and when made some specific changes. This will allow to correct the mistakes of inexperienced employees in a timely manner without causing any damage to the budget, and possibly the company’s reputation.
As we can see, the development of customized accounting software can solve a number of problems related to the specifics of a particular type of business activity. If you have a need to make accounting software, contact us at any time. We will create for you a reliable software product that you will be able to adapt to the changing requirements of your company. If you need to scale your business, we will modernize the already created product in the shortest possible time, and it will still retain its relevance and usefulness.