One of the first things every business owner needs to decide is how they intend to keep track of their accounts. Options vary from a shoebox full of receipts to a fully integrated industry specific Customer Relationship Management (CRM) system which help them manage their customers on many levels. The reality is most small-to-medium business owners will be able to use an “off the shelf” product, something easily accessible from providers like MYOB, Quickbooks, or Xero.
So, when the prices of these products range between approximately $10 – $150 per month, it begs the question, are they worth it? Spoiler alert – they are.
To properly answer this question, we probably need to take a step back and ask, what’s the point of an accounting system? Well, in simple terms there are two:
- To provide accurate records in order to comply with organisations like the ATO (e.g. BAS, tax returns, payroll, etc.)
- To provide useful and timely information so the business owner can make the right decisions
I think there’s a very solid argument that a shoebox full of receipts doesn’t do either of these things. A shoebox certainly doesn’t provide an easily accessible information for the business owner. Sure, they can pay a bookkeeper or accountant to dig through and organise them periodically, but they’ll be charged to do this. Also, shoeboxes are notorious for having missing information – missing receipts or stuff paid in cash that gets lost along the way. This means that not only is the business owner flying blind, but they’re also running the gauntlet if they cop an audit.
So, what does a business owner get for their monthly subscription from MYOB, Quickbooks, or Xero?
- Accessibility from anywhere – most of these products run in an internet browser these days, so provided there is internet access, the accounting system is accessible. MYOB even has some offline solutions for businesses with internet issues.
- Bank feeds – the ability for the accounting system to connect to the business bank account is massive. It dramatically cuts down on data entry time, as well as minimising the chance of human error.
- Compliance with ATO – legislative changes over recent years such as Single-Touch Payroll and Superstream have made it very difficult for businesses with employees to comply without a software provider.
- Collaboration – business owners are now able to view the same information as their employee in another location, their bookkeeper or accountant in real time. This makes everyone’s lives easier.
The above advantages are just a sample of what a modern accounting product can do. Given the time that they’ll save, the cost shouldn’t really be a factor. They’re worth it for the vast majority of business owners.
Once a business owner has decided to switch to one of these products, the next step is to talk to an accountant.
Here’s some reasons this is a good idea:
- There are multiple different products offered by MYOB, Quickbooks and Xero. Every business is different and will have different needs. An accountant will help them choose the right product for them.
- Accountants may be able to access wholesale pricing, discounts, or other offers that aren’t available to the general public.
- A good accountant will help the business owner configure their file and show them how to use it. This will help to minimise errors and reduce headaches (and accounting fees!) down the track.
