An accounting application is a special type of software that allows businesses to perform double-entry bookkeeping. The accounting software is either installed on a computer or used in the cloud via a web browser to help serve the basic accounting needs of the business. Some accounting systems also perform double duty as financial dashboard software. The dashboard allows users to see important financial information at a glance making monitoring finances easy.
1. Company managerial accounting
As the name implies, managerial accounting manages the financial life of a company in addition to performing double-entry bookkeeping. The software allows for planning, growth, and analysis of finances is minute detail.
Managerial accounting is split into two areas;
- Lean managerial help a user evaluate the business process and provides feedback that can be used as the basis of decision making to increase productivity, efficiency, reduce expenses, increase profit and evaluate client and vendor value.
- Cost managerial accounting deals with comparing the expenses incurred in product or service delivery. Tools calculate the cost of current expenses and what you may incur in the future. The comparisons made will help a company make informed decisions that reduce costs.
2. Company inventory accounting
This is an accounting system that helps track of the company inventory. It checks on what comes in and what goes out. Built-in inventory management helps you know what you have in stock, back order, and what you require to order to fulfill future sales. Company inventory also falls into two areas: manual entry of inventory or automated by barcode. Company inventory management is tied the accounting system or sometimes connected to invoicing software. When a sale is made, the item is subtracted from inventory and sales and any associated taxes are also recorded, and a paid invoice is sent to the customer (in the cases of online sales).
3. Industry-specific accounting systems.
This is a system of accounting made to fit the needs of a specific industry. Some industries function in very specific ways. A good example is accounting software for retailers. Retailers require small business accounting software that allows them to balance cash registers at the end of each day or each shift. Compare the needs of retailers with those of consultants. Consultant accounting software that records all aspects of service delivery, allowing the consultant to create services, service rates, add clients, and track service delivery by the client.
Non-profit business accounting system
A non-profit business accounting system is used mainly by organizations that also track donations and funding (in addition to performing all double-entry bookkeeping functions).
The system often has a financial dashboard software that displays funding by month and source, where and how it was used. There is usually a need for such systems to either perform invoicing or connect to invoicing software.
These days, many online small business accounting software vendors build systems that are flexible enough to meet the needs of a wide range of business types. On occasion, though, specialty industries with unique and specific needs, such as construction companies and not-for-profit agencies, will have to purchase software made especially for their industry.
