Five Key Components To An Efficient Accounting System. How Does Your System Rank?

Most businesses today have abandoned the notion of a "paper" accounting system. Although, businesses still refer to various accounting "books" and a "general ledger", these elements are all computerized. Technological advances have made accounting IT systems both feasible and affordable for even the smallest businesses to utilize. Both off-the-shelf and customized accounting solutions foster operational efficiency like never before, for any size business. These systems provide access to critical, consolidated automated reports for decision making. For any size company, there are five key components that must be considered when integrating an accounting system into your business.

1. Software Program- Today, there are multiple software programs from which businesses can select. Some are targeted towards a small business or micro business, while others are geared towards the needs of enterprise level companies. Consider what your own company's individual needs are, and select a software program that provides you with the flexibility and features you need to run your business. If you are unsure of your needs, consider working with a consultant or business advisor who can guide you in this decision. Often times, consultants and advisors have the expertise to customize off-the-shelf solutions if they do not fit your exact needs and provide the appropriate training, as well.

2. Existing IT Infrastructure- When selecting and integrating an accounting system into your business, the existing IT infrastructure component contains critical elements to evaluate. Network structure, number of desktop computers, printers, remote access, and current operating systems are all important considerations and may impact the accounting systems integration.

3. Data- Although it may appear obvious, the data collected for accounting purposes is a vital component to an accounting system. What is not always sufficiently evaluated, however, is determining what data is actually captured. Careful consideration must be given to the types of transactional or core business data that will be stored in the accounting database and the ease at which it can be accessed. Will the data be entered cross departmentally? For example, will vendor invoices requiring payment by purchasing be stored in the same database as payroll or timesheets? How will inventory be registered on financial reports?

4. Security and Internal Controls- When integrating an accounting system into a business structure, business owners must determine who has access to the system and at what security level. This includes not only password and login information or number of user licenses but also a determination on who can input data directly, cross-departmentally. Other considerations include system encryption for remote access, as well as system file back-up for business contingency planning.

5. Administration and Users- Finally, a key accounting system component which is often overlooked is the people who will actually serve as administrators on the system or as end users. The accounting system should be user friendly and simple enough so that those who need to use it every day readily recognize the improved efficiency of the system and adopt it into their daily routine. Additionally, the end users also need to be properly trained on the system so that both they and the company fully leverage the system's capabilities.

The person designated as system administrator should have sufficient working knowledge of both accounting and technology to properly train users and to make informed decisions about the previously referenced accounting system components. If they do not have this knowledge, they should consider hiring a consultant or business advisor who can assist with this so that the company can maximize a return on their investment.

Consideration of these five key components when integrating an accounting system into your business should facilitate an easy transition. We are currently offering a free analysis of your business processes and accounting system. If you would like to learn more on how Analytix Solutions can help move your business forward, please call me directly at 781.503.9004 or email me at sales@aixsol.com

Satish Patel, CPA
President, Analytix Solutions
Satish Patel, Founder-CEO of Analytix Solutions, has more than two decades of experience as a CPA. He has also advised small and mid-sized businesses on diverse matters such as valuation, accounting, and finance. His experience extends to raising capital and arranging for finance from angel investors.

CFO And IT Services: A Winning Combination

In today's increasingly global and fast moving economic environment, successful companies recognize that finance and IT departments have grown increasingly complementary. One of the greatest advantages of working with small to mid-sized businesses is their ability to move quickly and efficiently to deliver services and address client issues. Synergies between CFO services and IT foster this type of business agility, and businesses which embrace these synergies discover they can demonstrate a competitive advantage to their clients and customers. As a starting point, following are four key areas to assess for integration between CFO and IT services.

Software roll-outs - This may appear obvious, but what is not always obvious is at what point the two areas should begin collaborating. Answer: as soon as possible. Software rollouts are most successful when finance and IT begin working together at the beginning of the process. A CFO can provide insight into financial reporting and management needs, as well as expectations of an accounting system or software program. Early involvement of IT services allows them to anticipate long term implications of the system and address what is technically capable. IT can ensure that the systems selected are flexible and scalable enough to meet future growth.

Greater access to data sharing - One of the benefits of updated accounting software and systems is their ability to provide access to key data for reporting needs. Newer systems allow authorized partners or employees access to key data by logging into the system themselves and generating automated reports. Previously, providing these partners or coworkers with critical reporting or real-time data required a CFO or Controller to compile and generate requested reports, often manually. When a CFO and IT services work collaboratively to identify areas appropriate for real-time data sharing, productivity increases as the data sharing is performed more efficiently.

Data security - With many finance departments now subscribing to financial SAAS programs and leveraging cloud based systems, ensuring data security within a business is critical. In addition, many companies have evolved into businesses with a high volume of web based transactions- purchases, inventory management, fund transfers, bank statement reconciliations, etc. The increasing volume of web based and remote financial related transactions necessitates unprecedented levels of data security. Delivering this level of data security requires the commitment of both the CFO and IT services.

Cost controls - One of the most significant ways a small to mid-sized business can increase profitability is to control costs. Working together, finance and IT can identify thresholds and establish automated triggers to notify CFOs when costs are surpassing this threshold. Success depends on the data being accurate, while also readily and immediately accessible. Even more importantly, IT involvement to automate these types of functions and reports means that a CFOs role can evolve from simply reporting to analysis, resulting in more robust financial management for small to midsized businesses.

These are just a few areas in which IT and CFO services can complement each other to make your financial operations more effective. Other areas to consider integrating the two are any place where analysis and decision making can be enhanced or where efficiencies and cost reductions are achieved. We are currently offering a free analysis of your business processes and accounting system. If you would like to learn more on how Analytix Solutions can help move your business forward, please call me directly at 781.503.9004 or email me at sales@aixsol.com

Satish Patel, CPA
President, Analytix Solutions
Satish Patel, Founder-CEO of Analytix Solutions, has more than two decades of experience as a CPA. He has also advised small and mid-sized businesses on diverse matters such as valuation, accounting, and finance. His experience extends to raising capital and arranging for finance from angel investors.

Online Accounting Systems Can Result In More Effective Services

Taking your accounting online can help you streamline your finances, making for more organized accounting and reliability in other areas of your services offerings.

Organized data and better management

When your accounting moves online, human intervention is greatly reduced, automatically resulting in heightened accuracy. Because accounting is one of the basic functions in a business, scattered or poorly-maintained accounts can create problems across all your business offerings and client services. Online accounting automatically results in better organization of your records and helps you maintain updated and current records across the services and solutions you provide your clients.

Online accounting systems do not mean you no longer have control over your accounts. On the contrary, it takes off the drudgery from your day-to-day operations so that you have time and resources for your business concerns. Online accounting takes over data entry and management so that you no longer struggle with complex data or spend quality man hours in training staff to meet your specific needs. Once you hand over your needs to a qualified vendor, you will find that an online accounting system actually speeds up your operations overall, allowing you to provide deliverables and services to your clients better.

Complete and updated data

An online accounting system provides you with complete financial information at your fingertips. What is the money owed to you by your clients, what is the exact amount and by how much time is it overdue - all of these questions can be answered when you look at your accounts, provided they are updated. Low on cash? An online accounting system can help ensure you don't face crippling cash crunches that could force you to disable your client deliverables and regular services.

Further, having updated accounting means you are on top of your expenses and balance sheets. This is vital not just from the perspective of a business owner, but also from the point of view of investors who will examine your credit-worthiness. Here are some specific benefits that prove how an online accounting system can help you spruce up operations and deliver better solutions and services.

Satish Patel, CPA
President, Analytix Solutions
Satish Patel, Founder-CEO of Analytix Solutions, has more than two decades of experience as a CPA. He has also advised small and mid-sized businesses on diverse matters such as valuation, accounting, and finance. His experience extends to raising capital and arranging for finance from angel investors.

Five Financial Management Tips for Small Businesses

Many small business owners are driven by entrepreneurial inspiration to start their own companies. Small businesses drive new jobs and innovative ideas. However, for all the "pros" which accompany running your own business - the thrill of bringing a new idea to market, fulfilling a goal, flexible schedules - there are also challenges. Owning the business may be the simple part. Running it smoothly and profitably often can prove difficult. Following are five financial management tips that should assist in running your small business more effectively so that you can enjoy all the "pros" that influenced the decision to own a small business in the first place.

1. Develop a Budget- This is critical to the success of any business. A budget that lists your projected revenue and expenses serves as a road map in guiding business decisions and making sure you carefully consider financial decisions with the "big picture" in mind. When you create a budget, you can see the cash inflows and outflows. A budget functions as a financial barometer, allowing you to project accordingly, optimize and manage cash flow, as well as anticipate future financial needs.

2. Stay Abreast of Your Financials- As a small business owner, implement a routine practice of reviewing your financial reports. Staying abreast of your financials also equates to maintaining up-to-date accounting and bookkeeping records, as well as managing your expenses, payables and receivables. Timely and accurate access to updated financials allows you to make informed decisions quickly that could significantly impact your company's profitability.

3. Retain the Expertise You Need- Recognize that running a small company or start-up does not require you to single handedly perform every function associated with that company. Focus your attention and efforts on growing your business. Establish partnerships with companies or contractors who possess expertise in areas at which you are not adept or those to whom you can outsource non-core tasks. This will be more efficient for you in the long run, as well as allow you to avoid costly mistakes that could occur by performing functions at which you have no experience. Leverage partnerships for CFO, CMO, IT or bookkeeping services to provide you with scalable access to expertise when you need it.

4. Invest in Technology- Recognize that investing in technology can significantly impact the infrastructure of a small business making it operationally more efficient. Use technology to automate processes wherever possible to reduce manual functions that take employee focus off of value added services. Accounting systems and software programs that assist with payroll, data entry or time and billing are examples of functions that can be automated with investments in technology.

5. Anticipate Changes- Above all, embrace the ability to be flexible and make pivotal decisions that can positively impact your business. One of the biggest "pros" of running a small business as well partnering with a small business is the ability to change directions quickly when deemed necessary. Anticipate and plan for change to remain competitive in the market.

As a small business owner or entrepreneur, implementing these five steps can assist in making your business run smoother and more effectively. We are currently offering a free analysis of your business processes and accounting system. If you would like to learn more on how Analytix Solutions can help move your business forward, please call me directly at 781.503.9004 or email me at sales@aixsol.com

Satish Patel, CPA
President, Analytix Solutions
Satish Patel, Founder-CEO of Analytix Solutions, has more than two decades of experience as a CPA. He has also advised small and mid-sized businesses on diverse matters such as valuation, accounting, and finance. His experience extends to raising capital and arranging for finance from angel investors.