How to Set Up Small Business Accounting Software

Accounting is the system used to report your revenues and expenses to the Revenue Department, Companies House, UK Revenue Agency, US Internal Revenue Service, and other statutory authorities. There are three main systems that are used - Single Entry System, Double Entry System, and Worldwide Application System. A business is required to comply with Revenue, Tax, Insurance and Companies Act. The Revenue Department of government are concerned with money from excise and corporation taxes. Tax authorities are concerned with taxation and revenue tax. The Companies House department deals with companies and businesses and can be filed through a single or double entry system. The Insurance department of government is concerned with policy issues, such as policy for life and other insurance and product claims. And the Global system handles transactions from worldwide clients.

Accounting is also known as Bookkeeping or Accounting. It is the art of recording all your financial transactions. While Accounting in general means keeping all your financial transactions, Bookkeeping specifically means recording them. In a particular accounting year, transactions are entered into the bookkeeping ledger, the "Bank" book, and the "Purchase ledger" and "Sale ledger". At the end of each accounting period, the bookkeeping ledger called the "Cash book" is reconciled to the "Adjusting account" or "Adjusting entry" in the chart of accounts.

While there are three main accounting systems, a business may convert to any of these systems, the financial impact will be same. A business can convert to the Single Entry System, Double Entry System, Worldwide System, or any other system, but their Financial Impact would be same. So, keep this fact in mind when considering any of these systems.

Single Entry System:

This system is simple, and it is an accounting system that records and classifies all financial transactions. Single entry system is considered a good accounting system for small business. If you are running a small business and need accounting system, then you can use this system. This system uses only one piece of equipment called a ledger. It consists of two sides.

The left hand side is where the debits and credits will be recorded. On the right hand side the records of revenues and expenses.

However, if you have a lot of financial transactions, then you can use an additional side called a ledger board.

Each bank will provide you with different types of ledgers. The ledger board that you need to buy will provide you with left hand side ledger and right hand side ledger. This ledger board will come with both a debit side and a credit side. The debit side will hold your income and the credit side will hold your expenses. These can be useful if you have a lot of financial transactions on a daily basis.

Double Entry System:

This accounting system is considered as the most complicated accounting system. The double entry bookkeeping system uses two sides of paper. One side is where the debits will be recorded and the other side is where the credits will be recorded. This double entry system require lots of paper work and careful managing. These can be a good system for business with a lot of transactions everyday. However, if you are running a small business, then you can use a single entry bookkeeping system. This system will use one side of paper where the debit side and the credit side will be used.

So these accounting systems are the most commonly used systems in small business. You can choose whichever you like to use. However, they all have their own weaknesses and strengths. So choose wisely.

The accounting software is also a useful tool in accounting and can be used as a personal as well as in business. These programs are also available in different languages. So whether you use them on your own as a personal or in business you can always get assistance with it.

Also small business can get an accounting department from outsourcing firms. The services are also cost effective. There are several firms that offer these services. Which one you use will depend on your budget.

So these are the main ways in accounting and below I have listed some useful tips for this.

1. Get training : Do your bookkeeping tasks with the help of an accounting expert. In this case you will not be under threat because you will have trained professionals who can manage your accounts.

2. Be careful : Your financial information is very crucial because your business is very vital. So if you make a mistake then your business would suffer a lot. So choose a professional who can handle financial data.

3. Know your business : To make your business grow, you have to make entries. So find out what your business income is and then ask for help from an accounting expert. If the help is available in your area then choose a competent expert. Otherwise you can ask your family members.

There are some small business accounting software which are available in the market. But they are more expensive. So choose wisely.