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Table of Content
Blog Summary:
Dive into this in-depth guide on how Accounting Software Development can be fruitful in maintaining your business’s financial stability. Small, medium, and large businesses, startups, and enterprises will get valuable insights on the types of software they can develop, key features, and the essential steps to developing one for their business. We have also covered the top five software leading the market today.
Table of Content
Collecting financial data for any business is like nectar—it’s highly precious, valuable, and intricate. Hence, to extract the full value, your business needs to invest in accounting software development to house its efforts, ensure efficiency, fuel decision-making, achieve growth, and sustain.
Accounting software enables accounting teams to work tirelessly to extract it. Investing in this segment is highly beneficial as Fortune Business Insights predicts that the accounting software market is expected to reach USD 20,408 million by 2026.
Like honeycomb stores and organizes honey, the accounting software provides the framework for the accounting team to organize, track, and analyze financial data. It allows accounting teams to focus on what they do best: ensuring the financial health and success of the business.
By simplifying complex tasks, ensuring accuracy, and safeguarding important financial records, custom-built accounting software symbolizes structure, precision, and protection.
In this blog, we’ll uncover all the secrets of how accounting software can help you collect this financial nectar from various departments and transform it into honey.
Accounting software enables you to monitor your business’s financial health. Your accounting teams can easily access the most basic features, which include a general ledger, inventory management, report generation, tax compliance, and automated billing.
Let’s look at the types of accounting software available:
Cloud-based accounting software is one of the two types of general accounting software used by most businesses. The other one is on-premise accounting software, which is usually installed on local servers. However, businesses today prefer cloud-based accounting software development because this type of accounting software allows you to cover most basic financial tasks:
These types of software require a subscription and provide the greatest flexibility. Your team can log on across different devices, expand storage, add new licenses, and use updated features as and when they are rolled out.
Popular examples include QuickBooks (best for small businesses), Zoho Books (best for budget planning), and Xero (best for integrations).
Desktop accounting software is usually installed on the desktops or local servers. Unlike cloud-based software, they don’t require Internet access to store and operate data. Once your business purchases it, teams can install it on desktops. It offers the following key features:
It stores data locally on the desktop drive, allowing easier and quicker access without the Internet. However, you have to manually manage and update all financial transactions, from expense tracking to invoicing. It requires a one-time purchase, and the business takes on the responsibility for data security.
Prominent examples include AccountEdge (tailored for small businesses), Sage50 (for small and medium businesses), and DocuPhase (specially designed for large businesses).
ERP systems are the type of accounting software that maintains a single integrated database for storing all the information collected from different parts of the business. With ERPs, teams gain the advantage over having independent software that’s specific to a particular department. Key features include:
Large and complex organizations can integrate these systems with other modules, such as project management tools, business analytics, and workflow management. Enterprises with multiple locations and lines of business can benefit from automation, cross-departmental collaboration, and enterprise strategy building.
Common examples are Multiview ERP (ideal for healthcare organizations), Xledger (suitable for financial organizations with multiple locations), and Odoo ERP (free accounting software).
Developing custom accounting software will enable you to build your accounting application. You can build it according to your financial needs, and in the process, you can also discover the features that would be beneficial to only you.
An accounting software development company can help you address the accounting challenges and fill that your business faces. The above commercial off-the-shelf (COTS) software solutions might fail to solve them and also require lengthy installation.
However, using the skills of talented development experts, your business can build a solution that automates your specific business tasks.
Use custom accounting software to identify gaps and optimize resource allocation.
Build a Custom Accounting App
Efficient financial management enables a business to assess its profits and losses accurately, thereby aiding better financial health. It requires creating accurate financial statements to show the true picture of a company’s financial performance.
Accounting software helps the teams achieve that by gathering and analyzing the wealth of data that are scattered across different departments through the following features:
Accounting app development for advanced billing solutions helps businesses automate the processes of calculating, sending, and tracking invoice and billing status to their clients by customizing them. It also sends reminders when an invoice payment is due by recognizing payments through secured payment portals.
Expense tracking helps you get a bird’ s-eye view of your business’s financial performance by tracking receipts, expenses, and payments related to a shipment. Accounting teams can efficiently process the data with workflow optimization, maintain better data security, and create better financial reports.
Working with multiple accounting systems to lower the workloads of accounting teams can become confusing. Having in-built and cross-functional modules integrated with ERP provides a centralized hub for bookkeeping and reduces accounting tasks. This also allows you to manage inventory better, check employee efficiency, and monitor incomes and expenses.
Accounting software offers automation features to calculate taxes and ensure they meet compliance requirements with tax laws and rates. They are also compatible with various tax conditions, VAT and sales tax, and e-filing systems to reduce errors while submitting taxes.
The payroll processing feature allows businesses to automate all the processes related to calculating employee salaries with tax deductions. It reduces errors and manual work required to store salary data, generate tax forms, track tax filings, and protect employee data from breaches and unauthorized access.
As businesses scale globally, automated accounting software allows you to add multiple currency support to simplify the rate exchange processes. Your accounting teams can easily process international transactions in foreign currencies with full transparency of exchange rates. It makes it easier to send invoices globally and get paid in different currencies.
Integrating third-party applications is often a requirement for many businesses looking to expand. Accounting software can easily integrate with other business applications, such as payroll systems, human resource management, asset tracking, inventory management, and CRM.
Each strategic business decision that a business considers is driven by a complex financial structure and has potential consequences. If the leadership doesn’t receive the right financial reports, organizations are more prone to make mistakes in business decisions.
Hence, accounting teams responsible for tracking how much revenue a business generates need automation to record, analyze, track, and report the right financial information through:
With real-time data, accounting teams can automate their financial calculations and reduce the risk of human errors. They can also obtain more reliable business valuations and perform quicker assessments during mergers or restructuring.
Teams can make their strategic guidance even more impactful with automated detailed reporting and analytics features by identifying trends and risks earlier. Accountants can base their advice on updated and precise information to provide accurate financial data.
Accounting software enhances the accounting team’s efforts in safeguarding sensitive financial information through encryption, access control, and audit trails. This ensures that only authorized personnel can access or modify financial records, enabling the accounting department to set up role-based permissions.
Accounting software helps the teams detect and report irregular financial transactions in real time, such as unusual transactions or access attempts. It allows the teams to address potential security breaches swiftly and make data backups to reduce the risk of data loss in case of system failures or cyberattacks.
The accounting software enhances the accounting team’s proactive management of financial data, making sure it’s well-protected and compliant with industry regulations. It further helps them create annual accounts and reduces the time-intensive process of maintaining different accounting structures.
Every business needs accounting, but it’s highly demanding, which is why it’s one area that has a lot of scope for improvement. Whether you’re maintaining books on-premises or in the cloud, you can integrate them with a variety of off-the-shelf accounting software solutions.
Here’s how the top 5 solutions help your accounting teams solve common business accounting challenges by allowing them to receive the right data at the right time for accurate analysis:
QuickBooks is specially designed for small and medium businesses. Intuit Inc., a top personal finance provider in the United States, developed it. QuickBooks brings almost half of the sales to Intuit Inc. owing to the ease it provides for small businesses with little or no accounting knowledge. It currently holds almost 85% of the software market for small business accounting.
Available On: Online versions compatible with Firefox, Chrome, and Safari. Accessible as a web app on iPhones and Android devices.
Key Features:
Integrations:
Xero is cloud-based accounting software that helps small businesses in 180 countries. It’s a Software-as-a-Service (SaaS) product that users can purchase on a subscription based on the number of entities they manage. As of 2023, it had over 3.5 million global users.
Available On: Xero Touch mobile apps for iOS and Android phones.
Key Features: It offers a unified ledger irrespective of location or operating system.
Integrations: Point of Sale (PoS), CRM
Additional services released: Making Tax Digital in the United Kingdom, Single Touch Payroll in Australia, and Payday Filing in New Zealand.
Developed by 2ndSite Inc., FreshBooks is another prominent accounting software for small and medium businesses. It’s a SaaS product accessible on desktops and mobile devices. In 2016, they released a new interface called FreshBooks Classic, but it was discontinued in 2022 after migrating users to the new platform. As a starting price, it offers a 50% discount on the annual price and USD 4.25 per month for three months afterward.
Key features:
Integrations and support: FreshBooks supports integrations with payroll management, offers a free API that enables external third-party integrations, supports multiple tax rates and currencies, and provides country-specific tax calculations in the US, Canada, and Britain.
Zoho Books is based in Chennai, India, and provides cloud-based accounting software for small to medium businesses, startups, and solo entrepreneurs. Its main industries include e-commerce, retail, and consulting. Apart from India, it serves the UK, the US, Australia, UAE, and Canada. It offers a free plan for businesses with revenue less than 50K in India; the basic plan starts at USD 20 per organization per month.
Available on iOS and Android mobile apps and web browsers.
Key Features:
Integrations: other products in Zoho Ecosystem, major banks, G-suite, Office 365, Zapier, MailChimp, Shopify, Indian government portals
Location-based Tax Support: VAT for UAE’s Federal tax, UK’s Making Tax Digital (MTD), GST/HST in Canada, USA Sales tax
Sage Intacct is a US-based accounting software that works on the cloud. It serves various global locations, including the US, Canada, the UK, Australia, and South Africa. It grew its business organically, offering its services to medium and large businesses with ERP and e-commerce features. Other industries include healthcare, hospitality, and not-for-profit organizations. It offers a subscription-based customized pricing model and annual contracts with the option to add new features.
Available on any modern web browser, has an iOS app but no Android app, has a web app, and is accessible as a cloud tool.
Key Features:
Integrations: Sage products (Sage People and Sage Payroll), Salesforce CRM, third-party software (Expensify, ADP, Shopify, Stripe), ERPs, API access
Location-based Tax Support: GAAP compliant in the US, VAT compliance with MTD, GST/HST in Canada
Speed up financial workflows with automated accounting software and free up time for more strategic tasks.
Let’s Discuss Your Project
With a lot of data from different departments, calculations can often be inaccurate, and business leaders don’t have enough time to process financial statements. Hence, developing custom accounting software allows easy and quick access to important financial information.
Check out how Moon Technolabs developed a robust invoicing software, Moon Invoice. Here’s how you can build one for your business:
Start by determining your business’s specific financial problem and how software can solve it. Do you want invoicing or payroll management? Defining user roles like admin and accountant, along with the functionalities, is also crucial. An app development company can help you build a roadmap by understanding your issues and challenges, and you can explain your goals and priorities.
The second stage demands a serious conversation between your business and the app development team. Since you have to develop the idea of what the software should look like, make sure you prioritize a user-friendly prototype. It’s a good idea to analyze big names like QuickBooks, Zoho Books, FreshBooks, etc, to determine your unique differentiators.
The third stage is to decide the core features you need for your accounting software. These include general ledger, accounts payable, accounts receivable, invoicing, bank reconciliation, expense tracking, and financial reporting. Advanced features may include multi-currency support, tax calculations, project accounting, automation, and integrations.
The technology stack will help you build a functioning system based on the prototype and core functionalities. You can choose between building on-premises, web-based, or cloud-based software and choose the technologies accordingly. For the front end, you can choose HTML5, CSS3, and React/Angular, and for the back end, Node.js and Python will suffice. For the database, choose MySQL or NoSQL.
The development team tests it for quality assurance to ensure it has a user-friendly design for an optimal user experience. They also make sure it complies with industry standards like GAAP, IFRS, and region-specific tax laws. Before deploying, they adapt the software for different regions and languages, fix bugs, add security updates, and enhance features for scalability.
Cost of developing a successful app and useful custom accounting software requires you to ask some important questions. Answering them will help you figure out the price range it will fall into:
Partnering with a custom accounting software development partner will make it easier to answer these questions, as you’ll have exclusive access to the most important team members. These include Front-end and Back-end developers, Business Analysts, UI and UX designers, Quality Analysts, DevOps engineers, and a dedicated Project Manager.
Here’s a tentative estimate of how the factors mentioned above will affect the costs:
Small-budget accounting software – USD 15,000 to USD 35,000
Medium-scale accounting software – USD 40,000 to USD 1,00,000
Large-scale accounting software – USD 1,20,000 to USD 3,00,000
These are estimated costs, and if you plan to add more advanced features, the costs can reach up to USD 5,00,000. The cost of hiring the development team will also come into play, starting from USD 45 per hour.
Accounting is the backbone of any business, whether you have a small or large one or are just starting to enter the market. It ensures that your financial operations run smoothly and efficiently, even with the increasing complexity of financial regulations.
With a wealth of financial information available, your accounting teams can’t rely solely on manual worker input. The need for accurate data automating accounting processes is no longer a luxury but a necessity.
Working with a trusted accounting app development company provides insightful analysis that aids in better decision-making, helping you determine whether you are operating at a profit or loss. It allows businesses to:
By investing in custom accounting software, your business can gain an all-in-one solution that boosts productivity and ensures financial health. By automating routine accounting processes, your finance and accounting teams can streamline manual tasks, reduce errors, and improve accuracy.
Tailored accounting software ensures that your business can optimize its workflows, increase productivity, and free up valuable time for strategic decision-making. With Moon Technolabs as your accounting software development partner, you will always have the right tools in place to maintain financial clarity.
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Jayanti Katariya is the CEO of Moon Technolabs, a fast-growing IT solutions provider, with 18+ years of experience in the industry. Passionate about developing creative apps from a young age, he pursued an engineering degree to further this interest. Under his leadership, Moon Technolabs has helped numerous brands establish their online presence and he has also launched an invoicing software that assists businesses to streamline their financial operations.
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