Accounting Software

Here’s a typical scenario in the old days of accounting. Papers, papers and papers. Who would have ever survived such an annoying, time-consuming, pain-in-the-neck ways of paper-based manual accounting in this age of digital technology? Thanks to accounting software products, life has been very easy for business owners, auditors, accountants and home owners.

Accounting software is actually an application system that’s either designed by a company’s Information Technology department or by outside software developer. A company may purchase a pre-developed accounting software package or may opt to custom design a software package for their use. Either way, accounting software helps in recording and processing accounting operations based on modular functions like trial balance, payroll processing, accounts receivable and accounts payable.

The industry of developing accounting software packages have been thriving since the mid-90s. Accounting software developers are constantly looking for solutions that address the growing needs of the accounting world. Accounting is a broad subject, that’s why developers are careful and very thorough in crafting applications. In addition, to the previously mentioned software tools, these core modules like general ledger, billing, stock and inventory, purchase order, sales order are also being developed. Other areas of accounting that are covered by accounting software solutions are debt collection, expenses, reports and timesheet.

An accounting receivable module typically is designed to allow easy data entry of incoming money. Accounts payable module facilitates release of money for payments and billings. Ledger module is considered as the company’s softcopy of their books. The billing module automates the issuance of client invoice. While the stock and inventory module records and controls company inventory.

PO module is useful for purchasing inventory. Sales orders module makes recording of client orders easier. Sales orders module is a common and widely-used part of accounting software in businesses like hotels, airline ticketing, e-commerce websites, retailers and suppliers among others. Most business owners buy a singular module such as sales orders to be used as standalone business software. But more often than not, business people would rather go for comprehensive accounting software that covers every aspect of a business operation.

Take note though that some business accounting software developers will use different terms for the previously discussed modules. All the more, accounting software has a general structure. The cost and the complexity of an application, however, will depend on the category. There are five different categories of accounting softwares, these are: personal accounting, low end, mid market, high end and vertical market. Each category is designed for a specific usage.

Personal accounting, for instance, is designed for home use. Simple modules like budget management, accounts payable and accounting reconciliation are covered by personal accounting. Low end applications are generic. These tools offer most of the common accounting modules and are targeted for the business market’s low end. It’s an inexpensive option for suppliers that do transactions with single national market.

Each national market has its own unique set of accounting practice, although international standards help make trading easier. Mid Market includes a number of accounting requirements from different national accounting standards and different currencies. Commonly used brand in this category are those coming from Oracle, Microsoft SQL, Crystal, Cognos, SDK and VBA Visual Basic for Applications.

High end is the most expensive and complex of the five categories. It even cost time as it usually takes months before the implementation of a developed application. A software called ERP or Enterprise Resource Planning is the frequent program suite used among major institutions. Vertical Market on the other hand is industry specific. It caters to banking, construction, medical and retailing.

From home to offices, accounting is part of human’s every day life. And what better way to make life easier than to have a tool that can serve as your partner in balancing things. Accounting software just does exactly that.