Accounting is a tedious and complex process, and most businesses think of it as a pain point that will always give them trouble. But the fact of the matter is, accounting and related financial processes like corporate banking, reporting, and payroll management don’t have to be as burdensome as entrepreneurs assume they should be. New business technologies now exist to make accounting easier and more efficient, and one pertinent example is that of the integrated accounting system.
Integrated accounting systems make the task of handling finances so much easier on companies, especially those that are looking to upscale or to modernize. The consistent and uniform flow of data that an integrated accounting system ensures, as well as the capacity to process it all, will result in a big competitive advantage for a business owner. By using this kind of software, a business can gain greater control over its financial processes and, in the long term, become more lucrative in its operations.
Before you adopt such a system for your own business, you may want to know more about what it entails. After all, any big investment you make for your company’s advancement should be preceded by an informed choice. To that end, here’s a briefer on the workings and the benefits of an integrated accounting system. This article should give you a good idea of what to expect when you purchase the software.
The Integrated Accounting System: A Working Definition
In simple terms, an integrated accounting system is a software package that consolidates several major financial accounting processes. Instead of being dependent on keeping separate books and files for management accounting, as well as turning to a mix of computer programs and analog resources, businesses now have the option to complete all the processes with just one application.
Key characteristics that come with an integrated accounting system are automation, high-level calculation abilities, and real-time data integration and management. These qualities make it possible for a business owner and their staff to overcome their initial feelings of helplessness and anxiety over financial housekeeping matters. After gaining access to technologies that make the work faster, easier, and more accurate, business staff will eventually become more adept and confident about their accounting.
In the Philippines, integrated accounting systems are sold off the shelf by business software vendors like ANSI Information Systems. Along with the product itself, a vendor may offer services like full oversight over the integration of the client’s computerized accounting system (CAS) and existing point-of-sale (POS) system, updates, maintenance, IT support, and documentation. If you plan to upgrade to an integrated accounting system soon, you can always ask your chosen vendor about the particulars.
What Does an Integrated Accounting System Include?
An integrated accounting system’s composition is central to how it works. Any business client onboarding a computerized accounting solution must envision it in terms of its modules, or the separate but interoperable software units that it uses to complete accounting processes.
The typical computerized accounting system consists of core modules and non-core modules. Below are the definitions for core and non-core modules, as well as common examples for both types:
Core modules are called as such because they come with the basic product right out of the box. Together, these modules allow an integrated accounting system to achieve the minimum of what’s expected out of it. Some examples of core modules that a business client will find on their integrated accounting solution are the following:
The non-core modules on an integrated accounting system, on the other hand, are modules that clients can add on to their basic package so that they can enjoy even greater functionality on it. Some examples of non-core modules that are optional to add on to a computerized accounting system are:
This modularity is part of what constitutes the appeal of an integrated accounting system. Several core accounting functions can be accomplished by the basic software package, but the client also has a fair amount of flexibility with regard to how much more they want their system to do. This also affects how much a client needs to spend on their product and how much value they will get out of their overall purchase.
What Is the Integrated Accounting System Capable of Doing?
The key selling point of an integrated accounting system is its ability to self-balance financial records. It is capable of reconciling all the financial data keyed into it in real-time and in an accurate manner.
Thus, a typical package of integrated accounting software with an optimal combination of modules will be able to complete the following tasks among others:
Some systems can also be linked to a company’s enterprise resource planning (ERP) software or its customer relationship management (CRM) software. In addition to accounting data, such systems will also be able to access data from point-of-sale (POS) terminals or inventory management modules from warehousing facilities. In other words, businesses can enjoy all-around functionality from software packages like these, as well as the ability to fully integrate accounting processes with other core business processes like sales, marketing, and inventory management.
The Benefits of Adopting an Integrated Accounting System
Among the benefits to be had from onboarding an integrated accounting system, these are what a client company can look forward to:
Less of a Need to Manually Input Data
One of the most exhausting tasks in traditional accounting is the manual input of numbers. Nobody in your accounting team looks forward to writing the same numbers over and over again, and then needing to balance new figures against them. Manual input will inevitably become both more tiresome and more complicated as your business grows. It would be detrimental if your business is unable to realize its full potential because your staff is overwhelmed by the task of manual accounting and is hard-pressed to keep your finances in order.
But the self-balancing feature in an integrated accounting system will greatly reduce your staff’s need to key in these numbers and to go through them again to check if they line up. In turn, it will save you and your team a lot of time as well as reduce the number of mistakes (and associated costs) that can be attributed to human error.
Stay on Top of Complex Accounting Processes
An integrated accounting system will also help you clear even difficult accounting processes, such as job costing and calculating sales commissions. You and your staff will have a much easier time doing these with the software as compared to doing them through traditional accounting methods.
With specialized software at your disposal, you will eventually become more confident at what you can achieve with your company’s numbers and make huge strides in your financial housekeeping. This alone is good enough reason to consider investing in an integrated accounting system.
Get a Bird’s Eye View of the Business’s Financial Situation
Thanks to the features of your integrated accounting system, you’ll also be able to garner some wide-ranging insight on your company’s financial situation. Both your business forecasting and your financial decision-making will be backed up by credible, accurate, and up-to-date accounting records.
It will no longer take hours for you and your staff to sift through complex numerical data and to make sense of all of it. You’ll achieve a 360-degree view of how up-to-date you are with your payments, how much money is flowing into your company, and where the best financial opportunities lie. As a result, you’ll be able to execute financial decisions that are truly right for your company at moments where your speed and decisiveness are needed the most.
Push Your Business Towards Modernization
20th century accounting methods will eventually cease to be enough for a 21st century company. While you have the opportunity, it would be good for you to modernize your accounting processes. The earlier you can start on your company’s digital transformation for core aspects like accounting, the better your position will be among your peers in your home industry.
Upgrading to an integrated accounting system is one of the most effective ways to keep your business competitive and to guard it from obsoletion. As a master of all things related to your business finances, you will have much less trouble navigating through the hypercompetitive and tech-driven business environment of today.
Some Caveats to Consider When Onboarding an Integrated Accounting Solution
The benefits of integrated accounting systems aside, onboarding one and incorporating it into your company’s workflow is not without its caveats. First, there’s no denying that you will have to make a significant upfront investment to purchase an integrated accounting system. Business software solutions like these often cost a lot of money, although you’ll have some flexibility about just how much you’ll need to spend for the modules that you require. Remember that even after you make the initial purchase, you will still need to foot costs that pertain to maintenance, updates, and IT support.
Second, once you purchase the software, you will also need to give your staff time to learn how to use it. You may also have to prepare for some initial resistance from your staff if they are already long used to completing your accounting processes in a certain way. As a figure of authority in your business, you will need to address the learning curve that your staff will experience with the software and ensure that they have adequate training and tech support to get them through the first few months of implementation.
Third, you should also take note that any computerized software solution that you onboard for your company’s use has to be registered at the Bureau of Internal Revenue (BIR). By default, large taxpayers are already required to use integrated accounting systems. But while these remain optional for small and medium-sized business, their use must be properly documented by the revenue agency.
Luckily, the registration process is quicker and has less requirements than it did before. All you need to do is gather some documentary requirements for your BIR CAS registration and wait for the agency’s official acknowledgment certificate before rolling out your new integrated accounting system.
In summary, if you want to get the most out of your new integrated accounting system, you have to exercise patience, do all the necessary prep work to warm up your accounting staff to the solution, and budget your money wisely for all your forthcoming IT expenses. This will be much easier on your organization if you are purposeful about your transition and if you can depend on your IT partner to guide you through all the necessary steps.
Making the Shift to Integrated Accounting Software: 4 Steps to Guarantee a Painless and Productive Transition
To go about your transition to integrated accounting software, consider doing these four steps in the following order:
Do Your Research on the Different Solutions Available
First, get a feel of what’s available in the market. Look up the software packages offered by business solutions experts in your area, and do some research about the different brands that offer computerized accounting software products. One type of product may be a better fit for your company than another, but you won’t know which one it is until you research and weigh your options.
Look for a Reputable Vendor to Guide You Through Onboarding and Integration
Your choice of vendor can spell all the difference between a positive onboarding and integration experience and an unpleasant and tiresome one. Choose a vendor who truly knows the ins and outs of the products they sell. They should also be able to tell you about what product type and what combination of modules will suit your business best, rather than simply offering a blanket one-size-fits-all solution for your specific accounting needs.
Train Your Staff to Use the Software Properly
Next, allot enough time and resources for your staff to get acclimatized with the software and incorporate it into their accounting workflow. It may take at least a few months to become familiar with the solution and to maximize all of its features. Be patient with your accounting team and give them the space to learn how to be more proficient with the software.
Monitor Both Improvements and Outstanding Issues in Your Accounting Performance
Lastly, make it a point to track how much you’ve improved in your accounting performance and take note of any additional kinks you may need to work out with your team and your software vendor. After all, it is simply impossible for your habits and your achievements to change overnight. The speed at which you and your staff pick up on the software depends on factors like the volume of accounting work that you need to do and how extensive your computerized accounting system’s features are. Celebrate wins like being able to beat your accounting deadlines, but address emergent problems like tech familiarity gaps among your younger and older accounting staff.
Partner with ANSI Information Systems to Modernize Your Accounting Processes
For the greater efficiency and control that it will afford your company, integrated accounting software is a worthwhile investment. But again, having an expert on top of its implementation also matters. You will be able to make the most out of your journey with your new accounting solution if you have an IT partner like ANSI Information Systems behind you.
ANSI’s team is known for its wealth of knowledge and experience in the field of business technology. But the clients who’ve worked with us to implement new integrated accounting solutions for their businesses also speak highly of our ability to connect with people and help them visualize how to use their new software in industry-specific contexts. We are happy to do the same for your company, as our success depends on what you are able to achieve with your new business solution.
Get in touch with our team to learn about the products we have in our portfolio and how we can customize your integrated accounting solution to meet your business goals. For more info on basic integrated accounting software packages, modules, and the registration process of your computerized accounting solution at the Bureau of Internal Revenue, contact ANSI now. Let us be part of your journey towards the full modernization of your Filipino business!