Every business is required to maintain accurate and updated financial records for tax compliance purposes. Records related to income tax, GST, payroll, and other business transactions must be kept either on paper or electronically. Maintaining a regular team of accountants can be expensive, which is why online accounting services are necessary and practical for small businesses.
Features of online accounting services
Bookkeeping: keeping accurate account books, journals, ledgers and other records is necessary for a business owner to keep track of the actual movement of funds in any given period. Accountants and bookkeepers have the educational background and training to keep accurate records. With internet technology, specialists like accountants are able to perform bookkeeping and accounting tasks offsite while reducing costs for the business owner.
Bank Reconciliations: To manage cash flow, it is necessary to know the inflows and outflows through bank reconciliations. Sorting through the details of a bank account can be confusing and time-consuming unless you hire an accountant. Through electronic data transfer and advanced Internet technology, it is now possible for a small business to retain the services of a reputable accountant without the usual costs associated with hiring one.
Financial analysis: analyzing the data collected by an online accounting service is important for any business that wants to measure the results of its marketing efforts, sales campaigns, cost-cutting measures and other business activities. Graphs, charts, tables and ratios provide a clear picture of a company’s actual financial position. These are often used to analyze, refine or modify strategy. Financial statements in certain forms such as profit and loss, income statements, and balance sheets are common requirements for obtaining additional financing or loans. Small business accounting services can provide these important statements as part of their record keeping function.
Payroll: payments to employees, retirement plan contributions, and other disbursements are regular activities that must be closely monitored by an online accounting system. This type of service facilitates regular review of previous payrolls and ensures accurate calculations. Related services include sending email notifications to employees and preparing checks or payments.
Other functions offered by small business accounting services include financial statement preparation, BAS preparation, and filing. Advanced accounting systems now offer these services either online or remotely through an Internet connection. These are the latest and most advanced systems that feature superior data security, user-friendly features, easy collaboration, and hassle-free upgrades.