Accounting for Small Business
One of the most important decisions a small business needs to make is your choice of accounting software.
One of the biggest mistakes small business owners make is that they purchase accounting software beyond their business needs and level of accounting skill. This can lead to considerable frustration and records that amount to nothing more than a ‘computerised shoebox’.
With so many software options available it is easy to become confused, and they range in functionality and sophistication with a price tag to match. To assist you we provide the following guidelines:
- If you don’t understand double entry accounting (i.e. debits, credits and journal entries) then avoid sophisticated accounting software programs. If you need to use such a program then consider a training course at a local TAFE that runs for around 14-20 hours at a cost of around $350.
- Don’t buy software beyond your business needs. If you don’t need inventory or a fully integrated general ledger system don’t buy a ‘Mercedes’ when you only need a ‘Holden’.
- Your software should be compatible with our general ledger system to allow easy transfer of electronic data. This can save time, money and assist with meeting the various lodgement deadlines.
Let’s briefly have a look at one of the simplest and most popular accounting software programs in Australia, Cashflow Manager.
If you simply need a ‘cashbook’ program to track your receipts, payments and GST we strongly recommend Cashflow Manager. It looks and operates like a manual cashbook complete with a spreadsheet or column layout and it requires no understanding of accounting, debits, credits or journal entries. At around $297 it represents excellent value for money.
The program provides business templates that automatically establish columns for certain business types and reconciling your bank account(s) is also very simple. If you have internet banking you can download your bank statements and import the data to save even more time. You can have multiple bank accounts in a single business and the comprehensive reports explain your business results and make preparation of your BAS very easy.
The program includes the debtors side of ‘Invoice Manager’ that lets you generate Tax Invoices and track your debtors and produce Customer Statements. If you have staff you can add ‘Wages Manager’ to process pays, print payslips, Annual PAYG Payment Summaries and also track staff entitlements.
MYOB and QuickBooks are also very popular programs and could be ideal if your business needs a full general ledger or point of sale solution. Both MYOB and QuickBooks offer a range of packages each with different features.
The MYOB product range stretches from Business Basics to powerful multi-user products such as Premier and Enterprise. Business Basics gives you the ability to track job costings and profitability, prepare your BAS and automatically reconcile your accounts. You can also customise the content and look of reports to suit the needs of your business. Other packages in their extensive product range include Accounting Plus, Retail Ready and Retail Manager.
Similarly, QuickBooks offers an extensive range of programs including general ledger, invoicing, basic stock control and a report generator. QuickBooks EasyStart is their entry level program and although the word ‘easy’ is part of the product name you will need to have some basic bookkeeping or accounting knowledge to use the program. Their product range includes Quickbooks Accounting, Plus, Pro, Premier, Retail Point of Sale and Retail Starter Kit.
If you do not want to do the bookkeeping yourself there are other options we can also assist you with.
We can assist you to obtain the right software for your business and we urge you to contact us regarding your choice of accounting software because the wrong choice can prove both frustrating and costly in the long term.
- Australian Taxation Office (ATO)
- ATO For Individuals
- ATO For Business
- ATO Superannuation
- ATO Rates & Calculators
- ATO Tax Topics Explained
- Aust. Securities & Investment Commission
- Australian Business Register
- Australian Business Entry Point - Government advice for starting, running, exiting a business, grants info
- Australian Stock Exchange
- Fairwork Ombudsman - Employee entitlements, minimum wages, etc.
- State Revenue Office Victoria (Payroll Tax)