A business management system with integrated accounting makes accounting as easy as processing orders.
Rather than manually re-keying information from order management into a standalone accounting system, which costs time and errors, an integrated accounting system automatically receives a constant flow of data from order management.
Since the information flows automatically, the financials are always up to date. And even sophisticated accounting operations like job costing and commission calculation are performed automatically just by processing the orders.
Here are 4 advantages of a business management system with integrated accounting.
Integrated Accounting Eliminates Re-keying
Re-keying creates two major problems. One is that it costs time and labor that could otherwise be devoted to more productive activities. The other is that that it invites errors and omissions that either go uncorrected or require more time and labor to find and fix.
A business management system or ERP with integrated accounting eliminates re-keying, which frees up staff to focus on sales and opportunities. Re-keying information from an order management system into a standalone accounting system is not an efficient use of time, and will inevitably lead to mistakes that no one wants on their books.
Integrated Accounting Provides Real-Time Information
Standalone accounting is always behind as it waits for someone to manually take information from the ordering system and re-enter it in the accounting system. That means never having the up-to-date financial information that’s required for the best decision making possible. Since data re-entry also invites human error, standalone accounting also stands a greater chance of leading to decisions based on faulty information.
Integrated accounting provides a complete real-time picture of the business at any time since information automatically flows into the accounting system as orders are processed. A web-based business management system with integrated accounting even lets you take complete, accurate financials with you wherever you go.
Integrated Accounting Can Automatically Perform Job Costing
With integrated accounting, even sophisticated accounting processes like job costing can be performed automatically -- effectively as a side-effect of processing orders. Postings are automatically made to Accounts Receivable, Accounts Payable, and the General Ledger so that the accounting system automatically has the information it needs to calculate job costs and to perform other accounting processes.
Standalone accounting systems that do perform some form of job costing often run into problems. Standalone accounting doesn’t "talk to” the order management system like an integrated accounting system would and so it doesn’t inherently know which costs go with which jobs. Attributing certain costs and information to certain jobs and orders might become a new manual process in itself.
Integrated Accounting Results in Accurate Commission
Similar to the way that an integrated accounting system can automatically perform job costing, an integrated accounting system can automatically calculate sales commission including split commissions. Once again as orders are processed the integrated accounting system receives the information it needs to calculate commission.
Integrated accounting systems are especially useful for companies that make job costs part of commission formulas. By automatically performing the job costing, the integrated accounting system automates one of the major factors to calculating accurate commission.
Find news, webinars, technology, trends, and more in the Essent Connect email newsletter.
Essent is the leading provider of fully-integrated business management software solutions and services for process-intensive industries and the largest trading network for the promotional products industry. The Essent family of fully-integrated products and services combines best practices, business processes, software automation, and network communications to deliver unparalleled, unified business management solutions. Since 1980, Essent has offered the systems, service, software, and support critical to success in today's highly-competitive marketplace.