The advantages of using the right accounting software
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Without the proper accounting software, the ability to financially manage the business is severely limited. On the contrary, using an advanced accounting ERP solves many of the great challenges that SMEs face in the financial management environment.
Pablo Couso, commercial director of Datisa says that “one of the first clues to know that it is time to look for more complete alternatives, is the excessive dependence on spreadsheets. Financial areas that use spreadsheets as the main management tool cannot provide timely support to other areas of the business. And, that, in itself, can significantly reduce the productivity of the finance team. Not to mention the negative impact on your ability to make quick and confident decisions.”
An adequate ERP solves many of the great challenges that the financial areas of SMEs face on a daily basis. The visibility of the information it provides is, in itself, one of the great contributions of these applications. But, delving a little deeper, from Datisa some critical uses of the ERP are pointed out to improve the financial management of SMEs.
Finance integration with other areas of the business
Without an ERP, CFOs have to pull Reports from multiple systems and reconcile them in Spreadsheets before understanding the data. This adds complexity and time. The financial areas seek to support their decisions on accurate and updated data and not on numbers collected weeks ago. “In fact, as Pablo Couso explains, using data more effectively is a priority for SME CFOs. And this is something that the ERP makes possible. Have information on purchases, sales, finances, etc. in a single system provides more visibility. And it improves performance.”
Accurate and conclusive financial reports
This is another of the priorities shown by the financial areas of SMEs. Being able to generate rich reports and not just documents with light data on income, cash flow statements or balance sheets.
Without the right accounting software, the ability to financially manage the business is severely limited.
The reports provided by a financial ERP provide a deeper insight into the profitability of the business. Not only directly financial data is obtained. They also make it possible to analyze the impact of other business areas on the financial environment. With the ability to access data from across the organization, it’s easier to generate reports with critical data in real time. And with it, make quick but informed decisions.
More efficiency thanks to automation
The automation provided by a powerful financial ERP is a game changer, also at an administrative level. For example, performing the usual tasks such as billing, payments, collections, etc., involve a lot of time. And, that, in turn, results in a significant increase in costs. The alternative is to automate most of the tasks involved in those processes and save time and money. In addition to gaining greater precision in the data.
This is just one example, but, as Pablo Couso assures, “when automation is applied to other functions such as period-end closings or collection management, the impact is cumulative.” The extra time obtained by the financial-accounting team can be used in other tasks that do require a complementary “human touch”, such as the preparation of accounting and treasury budgets, forecasts or analysis.
Improved management of fixed assets
Most financial ERPs include functionalities to improve the management of fixed assets. In this way, it will be easier to monitor and manage these company assets -machinery, buildings, computer equipment, etc.- It is easier to apply cost depreciation, and the automatic calculation and accounting of amortization during its useful life, using different models. It is a simple and safe way to avoid manual calculation, which is slower and has a high probability of error. Automating this process also increases your efficiency and helps identify and eliminate hidden costs.
Tighter financial monitoring and control
In the aftermath of COVID-19, effective cash flow management is one of the main challenges in the SME ecosystem. To tackle it successfully, SMEs are focusing on identifying savings areas. A financial ERP with the right functionalities provides a bird’s-eye view of operational and financial performance. And thus, facilitate the detection of the best opportunities to save. The automation that is introduced in accounting processes can have a positive impact on cash flow.
In short, these are just some of the improvements that the ERP brings to the financial environment of SMEs. Improving financial management could in itself propel the business to success. But, ERP software does not only impact one part of the organization. His influence extends to all corners. Therefore, its possibilities to optimize operational and strategic efficiency in all areas of the company are evident.