Investing in an online accounting system

Ask any business owner whether they enjoy the admin side of running their business and they will probably say no. However, staying on top of the administrative side of things, especially financial records, is actually a legal requirement. But more so than that, it is a necessary part of operating your business, especially your Digital Agency.

As a business owner, you need to stay organised and that means making sure you handle all your administration tasks or delegate it to a responsible member of your team. Whilst many business owners are comfortable delegating certain tasks to other trusted colleagues, when it comes to the financial side of things, most business owners decide to retain control. This is because the financial records are sensitive aspects of any business and are not usually for the eyes of other members of the team.

While the whole topic of accounting and finance can be daunting, it is an aspect of business that as a budding or serial entrepreneur, you really need to take seriously. The focus of this blog is to highlight the importance of investing in an online accounting system when launching a Digital Agency.

What is an accounting system?
An accounting system uses digital technology and the internet to complete the business accounting function. It helps you to have a specific program and process in place for recording financial transactions such as sales and expenses. There are many benefits for the business of investing in an online accounting system including efficiency, data accuracy and future planning. We will highlight some of these points in more depth later in this blog article.

Can I use a manual system?
Businesses always have the option of a manual system for recording financial transactions, either using a journal or having a simplistic spreadsheet set up. However, a manual system is always prone to human error as well as not being the most secure way to hold financial data.

With the adoption of GDPR, there is a real emphasis on the privacy of data across the world. Online accounting systems allow the business owner to securely hold data relating to their business and their various stakeholders.

A manual system is also not the most appropriate way to record financial transactions as you scale your Digital Agency. One of the most important things you can do as a business owner when you are building your internal infrastructure is to implement processes that will help you grow over time. Investing in an online accounting system from inception will give you the capacity to grow your business and not devote huge amounts of valuable time on the admin side of operating a business.

Why do I need an online accounting system in my business?
There are a plethora of reasons why every business that is currently trading, should invest in an online accounting system. For example, an online accounting system can save you time as mentioned above as it is simple and easy to record transactions as and when they occur.

Integration is another key feature of online accounting systems. For instance, you can provide your accountant with access to your account so they can compute your end of year financial statements and calculate your tax liability without you needing to submit lots of folders of receipts.

Moreover, the majority of online accounting systems also synch up to other software that a business may already be using such as email marketing software, recurring payment software or even a customer relationship management (CRM) system. This allows the business owner to really have a 360-degree view across all the main areas of their business and boost efficiency as well as make better-informed decisions.

What online accounting systems are available?
When it comes to online accounting systems for your Digital Agency, there are a number of options available that make the process of recording financial data simple. Most online accounting systems are cloud-hosted which means that nothing physical is downloaded onto your computer and this makes it easy to access your data on the move.

In our opinion, there are three online accounting systems that are really well suited to your Digital Agency and they are KashFlow, Quickbooks and Xero. All of these accounting systems are relatively inexpensive as you can start on their lower packages that contain everything you will need initially and then you can upgrade as your business grows.

What we like most about these three companies is the user-friendly interface of their program’s which is perfect for busy business owners who don’t have the time to learn complex systems. We would certainly recommend having a look at these companies although in such a competitive industry, there are many other alternatives that you can find with a quick Google search.

Summary
Overall, if you are looking to scale your business, Digital Agency or otherwise, investing in an online accounting system is crucial to your long term success. The advantages of implementing an accounting system from the start far outweigh the nominal cost of taking a monthly subscription with any of the software providers.

To find out more about how we can help you launch a successful Digital Agency as well as creating the right infrastructure for your business, contact our team today.

Until next time, take care.