6 ways cloud accounting software helps your business’s cash flow
Australia is experiencing an unwanted trend towards increasing late payment times, which heavily impacts on a business’s cash flow. So it has never been more important to get on top of your business accounting by adopting accounting software like Xero or MYOB, as this can dramatically improve your ability to successfully manage your company’s cash flow.
- Access anywhere, anytime
Many popular account software systems now operate in the cloud. The ‘cloud’ simply refers to the virtual platform where data and software are accessible online at any time, from anywhere and from any device.
This ease of access is not only convenient, but also secure against hacks or loss of data.
- Automation of routine tasks
Automating your accounting system not only frees up your time so you spend less time on debtor management, but also increases the likelihood of your invoices being paid on time.
By automating your debt collection process, you can ‘set and forget’ your system to execute routine and repetitive tasks for you such as payment reminders and statements.
Payment terms can be set to suit your business and personalised reminders can be sent to clients. Online payment gateways or client portals can be created to allow customers to view and easily pay their invoices.
- Tracking and visibility
Cloud accounting software allows you to track invoices to increase the visibility of funds owed and gain a more complete picture of your financial situation in real time. You can track invoice ageing and sort invoices from largest outstanding to smallest, so you can identify the most important debts to chase first.
Some software allows you to make notes against each debtor and integrate your email to create a complete record of all correspondence with clients. Other software allows you to click to send letters of demand from a third party agency, or click to receive a business credit check report.
- Cash flow forecasting
Software can help you prepare cash flow forecasts, which look at your business’s incoming funds and outgoing expenses for a given time period. Budgets can also be created and easily adjusted, to help you predict your business’s performance for the year ahead. Reviewing budgets regularly helps you to identify issues before they become serious problems.
- Debtor and creditor management
Accounting software not only helps with debtor management, but also with creditor management, assisting you to better match up your timing of payments to creditors and your debtor payment cycles. You can even monitor stock levels, eliminating over-ordering issues and keeping more cash in the business.
- Integrated apps
There are an increasing number of web apps and add-ons now on the market that can sync up and integrate with cloud account systems to provide further features and benefits.
Additional features include contact management, credit card/EFTPOS payment processing, and mobile invoicing, enabling you to create instant invoices even on smartphones and tablets, which can come in very handy when you are out and about running your business.
Online software can offer small businesses significant time savings and a more streamlined way to manage their all-important cash flow. By automating this software, owners can easily stay on top of their current and forecasted financial position, and spend more time on other core business activities.