Wednesday, January 3, 2018

The Benefits of Spreadsheets Or How to Excel in Bookkeeping

At some point, usually during the planning stages of setting up your business, you will have to make a decision about how to keep your records. Even if you are planning to employ an external bookkeeper or pay large sums to your accountant to take on the task for you, you will still need to keep records for your own and HMRC's benefit and these records can be kept in a variety of ways.
Many business owners still opt to use an old fashion manual accounting system, either because it is what they feel most comfortable with or because they don't perhaps realise the overwhelming benefits of using an electronic accounting system. It is not necessary to go out and purchase an expensive, complicated accountancy package to keep your books on your computer, a simple spreadsheet will be more than adequate, and can provide you with so much more than your old paper ledger ever could.
Computer spreadsheets have the capacity to store vast amounts of information and can be amended cleanly and easily, they also perform the function of a calculator, allowing you to make calculations in a click.
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Keeping your business accounts using electronic spreadsheets has a huge security advantage over paper accounts, as computer systems can be protected with passwords preventing the wrong personnel from accessing them. It is also possible to quickly produce back-up copies of your records to store off-site, keeping them safe from possible damage.
From the administrative position spreadsheets give more flexibility of presentation, organizing data in an easy to view way. Alterations and insertions can be made without confusion and calculations revised automatically when entries are amended. Your computer system also acts as a second pair of eyes alerting you to potential errors, which can be useful for a stretched small business, which may not have the wealth of personal needed to check and re-check each other's work.
Doing away with cumbersome manual ledgers makes everything that much easier to access; your accounting data becomes instantly portable on a tiny memory stick in your pocket; your bookkeeping records can be emailed to your accountant whenever he needs them and printed out for relevant colleagues. With the use of a spreadsheet it suddenly becomes easier to work from other locations, without the need to cart physical records home.
For those people new to bookkeeping the learning curve with an electronic system is possibly a fair bit shallower than with that of the paper ledger; spreadsheets provide plenty of information to explain the how tos and why fors and much of the complexity is diminished as the system does the complicated calculations for you.
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