How Outsourced CFOs Leverage Online Bookkeeping Services

Online bookkeeping

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Online bookkeeping solutions utilize the cloud computing environment to gather and correlate the information that a business needs to manage its finances. These software platforms simplify the bookkeeping process, minimize time spent on data entry and increase efficiency across the board. Many business owners and CFOs are taking advantage of these benefits by following smart implementation processes to create the perfect environment for handling daily finances.

Find the Best Software

The first step in setting up the ideal online bookkeeping environment is to determine which software platform has the right tools for the company. CFOs should become familiar with the most useful options and develop a list of the platforms that offer the best features. Small businesses vary in size, scope, and needs, so it’s important to consult with company executives beforehand to determine exactly what tools are needed to handle the constant fluctuations in their financial data.

Considerations are plentiful at this stage but everything from features and benefits to the support services offered by the accounting platform should be assessed. Many companies require a lot of customization or may need the software to scale and offer more comprehensive reporting down the road. Accounting needs for today as well as in the future should be analyzed before signing on the dotted line.

Simplify Payroll

Payroll becomes more and more complicated as small businesses expand and take on additional employees. Time tracking information must be transferred to the payroll department to generate the reports necessary to give employees accurate compensation. Online bookkeeping tools can take the data entered into tracking and payroll software and translate it into a format that can be used to prepare checks directly from the program. This increases accuracy and ensures that all employees get paid on time, every time without the accounting department having to spend hours working on payroll each week.

Many time tracking applications are also embracing the extensive array of options and benefits available through mobile connectivity. There are time tracking programs that allow users to enter time from the field, via mobile application and even via SMS text messages. CFOs can setup multiple approval processes for various members, further aiding in the improved data and details in submitted time tracked for payroll.

Manage Sales Data

Small businesses deal with a constant influx of sales data. Incoming and outgoing invoices, payments, purchase orders, order fulfillment, and shipping information all contain vital financial data that forms a large part of the picture when it comes to cash flow. Failing to track these numbers accurately and in a timely fashion can lead to confusion that stifles a company’s ability to make decisions about future growth.

Online bookkeeping software manages all of this essential data as it comes in so that company executives always have a clear picture of exactly how much money is available at any given time. By providing a quick, accurate way to determine the status of individual orders and invoices, these platforms save time at every step along the sales funnel. Some software solutions offer the option of automatically generating invoices and sending them to customers to unburden the sales department even more.

Monitor Accounts Payable and Receivable

It’s possible for a business to look profitable on paper but be struggling or failing in reality. This is a common problem faced by companies with inefficient bookkeeping processes that don’t show the true story behind cash flow. Using an online tool to keep track of the status of both accounts payable and accounts receivable removes confusion and shows where action needs to be taken to improve the health of the company’s finances.

Setting up email reminders and alerts speeds the collection process on receivables and remind business owners and executives when payables are due. This makes it easier to create a balanced payment schedule that keeps the company in the red rather than demolishing its budget.

Encourage Mobile Use

Remote access is a big part of what makes online bookkeeping so effective. Everyone from the CFO to the mobile workforce can access the software and input essential data from any device regardless of their current location. When everyone in the company gets on board with recording sales and expenditures as they happen, it should create a great increase in accuracy across the board. Employees doing business away from the office no longer have to wait to return to their computers to record transaction data. Instead, they can input all the numbers using an app on their mobile devices that integrates with the main bookkeeping software and delivers the information straight to the cloud.

Sync with Banks

It’s all too easy to forget to write down a deposit or withdrawal in a business checkbook and get an unpleasant surprise when the monthly statement arrives. This problem can be avoided by setting up online bookkeeping software to automatically receive financial data the moment that bank transactions occur. The exact dollar amounts are instantly recorded and accessible from the dashboard, a method that not only improves accuracy but also makes it unnecessary to spend time every month sorting through paper statements to make sure that the books balance.

Keep Communication Open

A reliable online bookkeeping solution should allow administrators to create various login permissions so that department heads, supervisors and employees in a company can access and modify information. Monitoring tools let CFOs check to see that everything is running smoothly and respond to any questions using collaboration options within the application. This keeps the flow of information free between all parties involved in a company’s financial decisions and removes barriers that stand in the way of efficient operation. Should the needs of the business change, the CFO and the service provider are always readily available to help with improvements.

Take Advantage of Reporting

Creating reports from financial data without the help of software is an arduous process that ties up small business employees who could be more productive elsewhere. The delay between data collection and the compilation of these manual reports creates the risk that the information could be obsolete by the time the report is finished. Online bookkeeping platforms include reporting tools for several of the most important business metrics:

Since all data entered into the system is correlated immediately, every new report reflects the latest changes in the company’s finances. Cross-platform synchronization is one of the main benefits of online reporting systems but it is not the only one. Comprehensive dashboards can aggregate data, improve reporting and allow CFOs to access the company's key performance indicators without even booting up their computer. Mobile connectivity in accounting applications is ubiquitous and allows users to not only view but also edit, manipulate and analyze all important data wherever and whenever it is necessary. 

Integrate All Programs

Online bookkeeping is most beneficial when linked to the other applications that a business uses to manage operations. Bringing together time tracking, payroll, inventory management and other software using a secure integration platform simplifies data flow and ensures that the information accessible through the online bookkeeping program is always accurate.

As with automation, integration facilitates increased efficiency and can save a business a significant amount of money by reducing time spent hunting down bits of information that were previously scattered across departments. Integration also cuts out a great deal of repetitive data entry tasks, decreases the rate of error and allows companies to optimize reports to contain the greatest amount of detail.

One critical component of accounting platform integration is understanding first what the desired outcome is before aligning systems. By knowing what the accounting requirements are, CFOs can more accurately evaluate the relevance of the many features and benefits of different programs to ensure they actually meet the company's needs. For example, job costing requires multiple systems to speak to each other across payroll, time tracking, and general ledger systems. If job costing is a major tenet of reporting, then whether the time tracking application syncs its data to the payroll processing services is a specific and important consideration.

Customize the Work Environment

Companies that offer integration solutions often include customization as part of their services. CFOs can take advantage of this to create a central platform that’s tailored specifically to handle any company’s needs. Every business requires a particular setup in terms of workflow, data entry forms, and connections between software applications. The platform itself should be easy enough for everyone to use without requiring extensive training. Online bookkeeping can be seamlessly integrated into this environment so that it becomes a regular tool in the management of data flow.

Keep in mind that customizations may require the intervention of trained IT services as needed to set up connectivity, ensure data is synchronizing appropriately and reports are accurate. This support should be budgeted when considering the cost of implementing new accounting solutions and online bookkeeping services because it will ultimately be needed not only during setup but during times of change, during growth and when the accounting team requires new information and reporting. Companies approach this in a variety of ways. 

Small businesses with a limited budget and a fractional CFO at the accounting helm may prefer to keep a relationship with a sole proprietor that can be flexible and on-call as needed. Unless needs are extensive, billing for hours worked would be more likely to benefit small business budgets than a monthly retainer. Conversely, larger businesses or businesses with complicated accounting needs may benefit more from keeping an IT company on retainer to service their ongoing needs. In limited situations, some businesses are best suited by having an internal IT support person on staff. This is usually the most well-suited for businesses that have an IT person already on staff who can take on additional systems responsibilities. 

By giving CFOs, business owners and employees a shared environment in which to track and manage finances, online bookkeeping addresses many of the issues of accuracy and communication that can cause detrimental errors. Correct implementation creates a platform that transforms the way businesses handle finances and offers the ideal environment for productivity and growth.