Managing and keeping a record of every financial transaction is crucial especially when the business grows. What if the bookkeeper forgets to add any expense that occurred? Or if he mistakenly adds a wrong entry? The time span of human memory is short and can not memorize all the financial transactions.
To minimize these errors many companies have already shifted toward automated bookkeeping software. This software reduces employees’ workload, saves costs and helps companies achieve targets in no time.
The global automated bookkeeping software market is forecasted to grow to $70.2 billion by 2030 at a CAGR of 19.6%. Accountants state that automation has reduced their workload and they are more satisfied than before.
What is Automated Bookkeeping?
Automated bookkeeping software allows companies to store all their financial data in one place. With just one click the authorized user or owner can see the financial statements in less than a minute. It automatically scans all the data from invoices, receipts, documents, or images and directs it to the instructed columns and rows.
5 Effective Ways of Automated Bookkeeping
Keeping records of financial transactions is easy in small businesses or startups. The need for automation increases when the business grows with the passage of time. It is crucial to record all the data manually and managing it requires more workforce.
Automation has reduced the workload of employees as it has numerous benefits. Let’s discuss a few of them:
Optical Character Recognition-OCR
Who would prefer to write boring financial entries manually? Repetition in them reduces the efficiency of employees and they find no time for any other task.
Automated bookkeeping has removed this issue by introducing an OCR scanner. It scans all the documents within a second and records the financial statements in its cloud.
Automatically puts the information in columns and rows and enhances its security as only authorized users can access the information.
The burden of a bookkeeper reduces as there is no need to record everything manually in hard copies. No paperwork is required in web-based software as everything is online.
A bookkeeper only scans a receipt and software automatically fetches the information. Less paperwork also reduces the company’s expenses and save cost.
Saves Time and Cost
Employees state that accounts payables and receivables are the most time-consuming tasks. It usually requires more time as the bookkeeper is responsible for sending reminders to suppliers and owners to pay invoices on time.
Automated bookkeeping software automatically sends reminders to the owners and suppliers to pay invoices before the due date. It helps in maintaining good ties between customers and the company.
Moreover, employees can save most of their time from repetitive tasks. Automated software warn the users when they try to enter a wrong entry.
Enhances Data Security
In traditional bookkeeping, any employee has the authority to access financial statements which increases the chances of fraud.
Automation overcomes this situation as only authentic users can access the software. The software generates a unique ID, password, or identification through a finger/facial scanner.
Data security is a crucial component of any financial sector. It limits data breaches, and stolen data and enhances data security.
A bookkeeper needs more space to store financial statements. Moreover, they are not easily accessible when required, decreasing the efficiency of employees.
Automation eases the accessibility of financial statements in less time. The owner can predict the future easily by accessing the audit reports instantly.
Automated Payable and Receivable
Accounts payable and receivables are the most challenging task, accountants state.
Automation has made the life of a bookkeeper easy by sending reminders to pay invoices and maintaining a good relationship with customers. After receiving payment from any of the sides it automatically enters the entries with the supplier’s name.
In the end, automated bookkeeping software enhances the productivity and efficiency of employees. It reduces workload and enhances inter-department harmony among employees.
Most SMEs are hesitant to acquire automated bookkeeping services as they think that the software is the most expensive. But, they don’t believe that purchasing accounting software is a one-time investment and will save them.
The benefits of automation are more than its disadvantages so this is an efficient way to reduce the company expenses. Data security is another feature many companies rely on for bookkeeping automated software.
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