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Best Accounting Software

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Accounting Software Describes A Type Of Application Software That Records And Processes Accounting Transactions Within Functional Modules Such As Accounts Payable, Accounts Receivable, Journal, General Ledger, Payroll, And Trial Balance. It Functions As An Accounting Information System. It May Be Developed In-House By The Organization Using It, May Be Purchased From A Third Party, Or May Be A Combination Of A Third-Party Application Software Package With Local Modifications. Accounting Software May Be On-Line Based, Accessed Anywhere At Any Time With Any Device Which Is Internet Enabled, Or May Be Desktop Based. It Varies Greatly In Its Complexity And Cost.

Modules

Accounting software is typically composed of various modules, different sections dealing with particular areas of accounting. Among the most common are:

Core modules

  • Accounts receivable —where the company enters money received
  • Accounts payable —where the company enters its bills and pays money it owes
  • General ledger —the company’s “books”
  • Billing —where the company produces invoices to clients/customers
  • Stock/inventory —where the company keeps control of its inventory
  • Purchase order —where the company orders inventory
  • Sales order —where the company records customer orders for the supply of inventory
  • Bookkeeping —where the company records collection and payment
  • Financial Close Management  — where accounting teams verify and adjust account balances at the end of a designated time period

Non-core modules

  • Debt collection —where the company tracks attempts to collect overdue bills (sometimes part of accounts receivable)
  • Electronic payment processing
  • Expense —where employee business-related expenses are entered
  • Inquiries —where the company looks up information on screen without any edits or additions
  • Payroll —where the company tracks salary, wages, and related taxes
  • Reports —where the company prints out data
  • Timesheet —where professionals (such as attorneys and consultants) record time worked so that it can be billed to clients
  • Purchase requisition —where requests for purchase orders are made, approved and tracked
  • Reconciliation —compares records from parties at both sides of transactions for consistency
  • Drill down
  • Journals
  • Departmental accounting
  • Support for value added taxation
  • Calculation of statutory holdback
  • Late payment reminders
  • Bank feed integration
  • Document attachment system
  • Document/Journal approval system

Note that vendors may use differing names for these modules.

Implementation

In many cases, implementation (i.e. the installation and configuration of the system at the client) can be a bigger consideration than the actual software chosen when it comes down to the total cost of ownership for the business. Most midmarket and larger applications are sold exclusively through resellers, developers and consultants. Those organizations generally pass on a license fee to the software vendor and then charge the client for installation, customization and support services. Clients can normally count on paying roughly 50-200% of the price of the software in implementation and consulting fees.

Other organizations sell to, consult with and support clients directly, eliminating the reseller. Accounting software provides many benefits such as speed up the information retrieval process, bring efficiency in Bank reconciliation process, automatically prepare Value Added TAX (VAT) / Goods and Services TAX (GST), and, perhaps most importantly, provide the opportunity to see the real-time state of the company’s financial position.

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