Bookkeeping service – online or classic bookkeeping?

Bookkeeping service - Invoice Crowd

Hiring your own accountant is often too costly for many startups, but even some serious companies with 50 or more employees do not choose this option for various reasons.

As an interesting example, let us cite the case where once three accountants from a company that employed ten people and were – you guessed it – looking at employment opportunities in our service, were ultimately forced to put the key in the lock.

It is clear that ten workers could not produce enough for 3 people in accounting and the director, who, unfortunately, was not able to estimate how much this administration and accounting really has.

Accounting service online or traditional accounting?

Why should you change the way you keep your books? There are several reasons, and on this occasion, we will look at some of them.

Further efficiencies and cost reductions have been made possible by Internet technologies and appropriate accounting programs, so that companies can now do online accounting – with the service they receive as if they had an in-house expert in finance and accounting, but at a much lower cost.Bookkeeping service 02 - Invoice Crowd

Higher speeds of Internet connections have enabled the development of services and applications based on Internet technologies. Banking was among the first to make its services available through PC and online connections, and there is no longer a need to walk into a bank branch with a wad of bills for clerks to transcribe while you wait patiently for your turn.

And companies in other industries are increasingly beginning to take advantage of e-business. As usual, smaller and more agile companies are particularly open to all innovations, especially if they see new opportunities to save and speed up business processes and stay ahead of the competition.

Purchasing and sales want to have the most up-to-date information on sales, realized price differentials by product, product group, supplier and customer, billing by days, overruns, discount scales, cumulative and periodic billing, etc. Production needs work orders with all data on material costs, labor, mud, thaw, breakage, depreciation, etc. Management needs daily management reports from management accounting.

Modern times and solutions

All of this documentation and business processes need to be processed, for which there are various software solutions that are used from sales and procurement to corporate administration to accounting, which keeps our books, etc.

Part of the work is done by employees within the company, while another part can be outsourced to external companies, e.g. accounting services, IT, etc. The more complex the business processes or the volume of documents processed, the greater the likelihood of errors in transferring or rewriting data when it is transferred from one software to another.

It is common that records of business changes are not timely and that management and other responsible persons in the company do not have timely insight into business results and cannot make appropriate decisions based on up-to-date, real-time data.

Often, accounting services are behind in processing records or have not received them in a timely manner because you simply have not had time to go to the service’s location and file the rBookkeeping service 03 - Invoice Crowdequired paperwork, which further slows down the monitoring of results and business policies throughout the year. Unwanted financial statements are nearly impossible to fix after the fiscal year ends.

Most of these problems can be solved by switching to online accounting. Invoice Crowd is always a great solution.

Sharing documents via Dropbox or Google Drive is not eBookkeeping! It may even happen that when using such an exchange method, you will have more errors in the accounting records than in traditional accounting (which, of course, you do not know because you do not have access to it and the data is not transparent).

Online accounting programs

If you use the same program as your accountant, you do not need to submit outgoing invoices to the accounting service, as they are already included in the accounting program. Incoming documents are sent to the accounting service by e-mail or fax. You do not have to deliver the documents to the service in person and the company archives the originals with them.

The submitted documents are imported and processed by the accountant into the accounting program, and the user can view them at any time and check if they have been processed and posted without having to browse through the registers.

The goal of this way of keeping business records is that the user can view the accounting program and his own financial transactions from the comfort of his office, and does not have to request extra information and paper reports that only the accounting service has, but can access his data independently when needed.

What is the difference between a classical accounting and an online accounting?

A traditional accounting service must be located somewhere nearby, as you must physically deliver all your records to the service location. Communication is possible only during working hours, and if you want to receive individual reports, you need to announce the accountant in advance to prepare them for you and wait a few days or weeks. All documentation is located in the accounting department. If you want to have a constant overview of your business, you need to keep parallel records and make copies of documents, as you leave the originals in the accounting department.

Online Bookkeeping

Bookkeeping Online does not need to be in your area, because it uses an online accounting program that you, as well as the client, access online through a username and password. The company issues invoices and quotes from within the program. There is also the possibility of doing the accounting in the program. Therefore, if you work with goods, you do not need an additional program in which you make receipts and calculations and keep inventory records, or copy documents from another program. Online accounting allows access to data and required reports at any time.

The responsible person of the company is responsible for the authenticity and archiving of the original documents. In accounting, the documents are transmiBookkeeping service 04 - Invoice Crowdtted electronically (mail, mail to fax, fax to mail). In the accounting program, copies / images of the original documents are attached to all posted documents, so that you do not have to search in the paper archive if necessary.

Regarding the case of tax oversight, taxpayers are usually emailed copies of the documents and, if necessary, the originals. Since copies of the documents are available in the program, it is easier to search and find the documents, which is usually sufficient in the case of tax oversight. In case of doubts about authenticity, taxpayers usually do not even look for the originals, but check the version with the counter party (buyer/supplier). Regardless of the type of accounting, the accounting service is responsible for the correct accounting of the submitted documents and the preparation of all legal reports within the prescribed deadlines.

Final thoughts

The confidentiality of data in all accounting services should be established by the contract for the provision of accounting services, and the data on the Internet is protected by your username and password. If you have doubts about data security because the accounting program is accessed online, remember to use Internet banking, where your account is also protected by username and password. The data is as safe as you keep your passwords, and since the weakest link in all protection mechanisms is “the human”, the data is no less safe than if your accounting is run by a classic service.

The main advantage of online accounting is the access to data and information, the possibility to check your own business and the availability of data 24/7/365.

In conclusion. If you want to have a constant overview of your own business, do not want to be limited by the working hours of the accounting service, are computer literate and have no problem keeping documentation up to date, you should opt for online accounting.


Related Articles

Did You Know?

Businesses that switched to Invoice Crowd have experienced a significant reduction in unpaid invoices and an increase in on-time payments.