What do you know about ERP accounting software? There’s a common belief that these are two different systems and they don’t coincide. Accounting software may be a separate project that you use for managing your finances and other things. Or it can be a component of an ERP system that comprises other components that are responsible for other tasks.
As small and midsized manufacturers (and businesses in general) grapple with out of control business processes, caused in part by the disconnect between accounting and plant floor operations, the need for a single view of organisational processes is driving the adoption of ERP solutions. The demand for ERP Accounting software is expected to grow rapidly.
Difference between Accounting Software & ERP
Stand-alone accounting software can take care of the standard accounting functions, banking and limited reporting. However, the standard accounting packages that small and midsize businesses have used for years, lack the ability to forecast what’s in store for tomorrow.
On the other hand, the accounting and financial management features and capabilities that are inherent in ERP solutions deliver a single source of real-time and fully integrated information across different departments for better decision making. Real-time visibility across the enterprise provides insight into purchasing, production, and inventory movement and warehouse management.
For example, accounting software, such as QuickBooks, cannot scale with your company’s growth because it operates on a proprietary database. Such stand-alone solutions weren’t built to connect company-wide processes and deliver real-time visibility into the status of those processes. As a result, you end up with silos of information that cannot provide a transparent and complete picture of your business operations.
How About ERP System?
An ERP accounting system is a software solution that is used for monitoring the financial part of the business workflow, tracking assets, resources, and materials. We can also add working hours, performance parameters, production lifecycle or relations with the customers. If you take an off-the-shelf ERP system, you will probably have a component for accounting.
If you develop a custom ERP system, you define yourself what kind of accounting module there should be and what kind of functions it should perform. You can have one single module that will make up the whole system for the company if you are happy with the solutions that you use at work.
The Truth & Myths About ERP in Accounting
There’s a lot of information about ERP accounting software that you can google. You can spend a few weeks reading long articles and get lost in the jungles. We have discovered the most popular myths about ERP software and we’ll prove to you why you shouldn’t consider them as the truth.
How To Use ERP Accounting Software
What are the key components of the software solution and how can you use them for solving your daily tasks? Scroll down to see what you can use ERP accounting software for.
It’s good to focus on cash flows and keep an eye on the receivables. You should carefully manage this issue as you will lose the possibility to pay all the bills or even invest money to grow your company. A robust accounting system will show you what clients pay on time and who ignores this.
If you don’t have a comprehensive system, you will not be able to track all the payments and if they were made on time. You may send outdated invoices or some clients may forget to pay for the goods or services. You may face problems with solving these problems and it may turn into a real disaster if there’s a big number of clients.
A comprehensive ERP accounting software will track all the transactions, purchases, billing, recurring and deferred revenue. You will help your company grow with no pain.
every PO and non-PO invoice posting — regardless of format — is entered into an electronic workflow. After our AI bots extract the correct data for verification, it’s presented for approval (or auto-approved when no exception is detected) and auto-archived for anytime access, so user is basically simplifying invoice processing.
Accounting software allows AP users to unify their workflow even in multiple ERP instances, leading to: anytime, anywhere access; simplified training and higher user acceptance; support for setup of shared services; and approval by non-ERP users. This feature called Consolidate global workflow and it’s available nearly in all popular accounting software.
Validating data entries in the general ledger is much easier and more accurate with a collaborative accounting system. Through increased visibility over company data, you and your team can pinpoint errors and validate correct amounts as an efficient unit.
Robust reporting features are also important for general ledger accounting. Isolating and reporting on specific entries and accounts helps you truly understand what is driving financial data. This also eliminates guesswork and provides definitive information needed to make the best business decisions possible.
You can link payroll to timesheet systems that record employee attendance or time worked. This allows you to automatically transfer information about hours worked into the payroll system and make payroll calculations much simpler.
By using basic payroll data, together with data on attendance and hours worked, payroll systems can provide a wealth of reports. This allows in-depth analysis of staff costs for the business as a whole, across departments and even individual jobs and contracts. User can basically using payroll software for comprehensive reporting.
The Importance of Using Integrated Accounting System
An integrated accounting system seeks only to improve the efficiency and accuracy of financial and cost accounting as well as corresponding financial reports. An integrated accounting system accomplishes this objective by assimilating aspects of both financial and cost accounting -- such as general ledger, journal entries, accounts payable, accounts receivable and fixed asset accounting -- into a single accounting system. Because financial recording takes place in one set of accounts, an integrated accounting system makes accessing financial information faster and easier and can also reduce administrative labor costs.
An integrated accounting system and the financial management module in an ERP system are similar at a superficial level. Both include financial accounting functionality, such as double-entry bookkeeping, a general ledger and journal and account reconciliation capabilities. In addition, both systems include tax analysis and reporting features and facilitate business planning and budgeting. What makes these two systems different, however, is the degree of integration an ERP system provides. For example, an ERP system can track financial information for more than business location. The ability to track and access financial information for multiple locations within a single application is a significant benefit.
If you are interested to integrated your accounting software with CRM / ERP system in your company, talk to one of our senior expert. He / she will guide you through your requirement to convert your dreams into one solid accounting objective.