Why Your Accounting Software Matters Just as Much as Your Payment Processing System

We spend a lot of time talking about payment processing at SwipeSum. After all, our mission is to find clients the best payment processing solutions for their business’ specific needs. So we talk a lot about why it’s important to evaluate your processing on a regular basis, navigate processing misconceptions, and avoid payment processing dealbreakers. We know payment processing is critical to any company’s bottom line, and we want to ensure our clients are getting the best deals for their money. All that being said, we’d be remiss if we didn’t acknowledge that payment processing represents only one side of a two-sided coin. You won’t find “e pluribus unum” on the other side; instead, you’ll find accounting software. Here’s why accounting software matters just as much as your payment processing system when it comes to running a profitable business.

Note: SwipeSum is a partner of several software companies and may receive commission on sales made through links on this page. Read more about our partnership disclosures here.

Why Using the Right Accounting Software Matters

As any business owner knows, payment processing is about that all-important component of profitability: Receiving funds from paying clients or customers. It’s easy to get caught up in this aspect of the business—after all, getting paid for the work you do is exciting. But just as important as how you get paid is how you process those funds once they’ve arrived. This, in a nutshell, is why accounting software is as crucial to your business’ bottom line as your payment processing system: It helps you track the funds received through your payment processing software so you can effectively manage your business. Without these financial tools and the insights they provide, you risk lost productivity (at best) and the viability of your entire business at worst. Accounting software allows you to track your business’ financial health by providing you with up-to-date insights into three critical financial measures: your balance sheet, your profit and loss statement, and your cash flow statement. If the payments you process are going to mean anything, you need to be able to quickly and reliably track how much money your business has, how much money is coming in and going out, and any outstanding debts or credits. This information is essential for determining your sales forecasts, identifying unprofitable goods or services, and shaping your quarterly goals. In addition to providing you with critical financial insights and a complete overview of what’s come through your payment processing system, accounting software also enables you to generate essential business reports for the purposes of taxes, payroll, financing, insurance coverage, and so on.

While some of these reports could be generated manually, one of the big benefits of accounting software is that it frees up employees’ time to do more than number-crunching, thereby increasing your team’s productivity. Accounting software also promises benefits in the form of simplified data entry, increased accuracy and security, automated generation of timesheets and invoices, comprehensive analysis tools, and (so long as you’ve chosen a reputable software company) the reassurance that you’re properly adhering to legal and tax regulations. If you opt for cloud-based software, you’ll also benefit from the ability to access your financial data any time and from anywhere. All told, the right accounting software can save your business time and money while providing you with valuable insights into your company’s financial health.

What to Look for When Choosing Accounting Software

The right accounting software for your business will depend on a number of factors, including:

• The size of your business
• Your industry
• Your operating system
• Whether you want the software to be locally installed or cloud-based
• Your budgetary constraints
• Your reporting needs
• The level of integration you require with other software or business accounts
• Your interface preferences

An honest assessment of these and other business-specific factors will give you a clear picture of the features you require from your accounting software. When creating your accounting “wish list,” it’s important to think about not only your business’ current needs but also how your accounting needs might shift in the future. It’s a real hassle to switch accounting software every year, so it’s worth taking the time to think thoroughly about your business’ current and future needs before enrolling in a new system. When we recommend accounting software, we refer our clients to Xero (click here to learn more). Their cloud-based accounting software allows business owners to integrate the software with other programs, access up-to-date financial information from any device with an internet connection, and feel confident their critical data won’t be lost even in the event of a hardware meltdown. And because Xero is scalable, the service can be adapted to your business’ changing needs over time. All told, it’s a highly effective—and cost-effective—tool for business owners in need of sound financial accounting. The right accounting software will give meaning to the funds that come in via your payment processing system by providing you with a comprehensive picture of your company’s financial health. These automated insights will not only save you hours of work every month; they’ll also inform the decisions that will shape your company’s profitability in the months and years to come.