Small businesses play a remarkable role in uplifting the economy of any nation. They are responsible for creating job opportunities irrespective of the market size while keeping the market competitive.
Small businesses face many challenges while running their businesses. You wear several hats while you run a small business successfully. Managing finance is crucial in any business and helps the business scale to new heights, provided the financial tasks are up to the mark.
A business may get hiccups if it fails to send invoices in time, gather payments in time, or expenses go haywire, resulting in closing up the activity. What if there is any tool available in the market which can automate most of your financial activities?
Having updated financial reports about your business helps you in several ways. You know your current financial status and can plan accordingly. It may also impress your bank if you want to borrow loans to grow your business. You know your bills and tax status beforehand and can plan to pay in advance to avoid penalties.
Let us discuss what type of functionalities you may require in any software to help automate your routine financial tasks, saving you the precious time you can use to expand your business.
Below is a list of features you should ideally check in financial software.
1. Estimates and Invoices
The software should be able to create customised estimates and convert them to invoices for your clients. The feature should be flexible, so you can incorporate all your required details in the invoicing without any effort.
It’s important to know where your hard-earned money is going. So this feature is a must in the list. This feature will help you to keep a tab on the expenses if any of them go for any invalid reason.
Keep a close eye on what you need to pay your vendors, including the utility bills. Check for this feature in the software that will help you manage your funds appropriately, and help you pay the bills in time, keeping a clean payment record.
Check for this feature, where you can fetch transactions from your bank to reconcile your accounts quickly. This feature may allow you to predict the cash flows, check mismatches in the balance, and give you an idea of recurring payments if any.
5. Purchase Orders
Purchase orders are required for any business, and check whether the software allows you to convert Purchase Orders into bills. This feature will help you streamline the process of converting purchase orders to bills efficiently.
6. Sales Orders
Similar to purchase orders, sales orders are crucial in any business. Check whether the application can confirm sales before dispatching. In addition, check whether you can convert the sales order to an estimate and further into an invoice on the fly.
Check whether the software is GST compliant and allows you to file GST online. In addition, check whether the GST changes are incorporated into the software as and when required.
Check whether you can keep an eye on the inventory to avoid stock-out situations and replenish whenever required. In addition, check whether you can add SKU, vendor details, cost, stock in hand, product image, pricing, etc.
9. Project Management
Project Management is crucial for any business. Ensure to have this feature in the finance software. It should give you an idea of how many hours, days, or months you have spent on a project. This information will help you know whether any project is fetching you profit or losses, and accordingly, you can implement corrective actions.
10. Audit Track
This feature should be a must in finance software. Tracking the audit will prevent fraud by monitoring the business activities closely. Ensure the audit track feature allows you to track end-to-end transactions, timestamps, user details, modified or deleted transactions, etc.
It will also make your C.A. happy, as this will save his countless hours and present all the data in a presentable way.
11. Reports in various formats
Ensure you can create reports in various presentable formats like charts, graphs or colourful tabular formats. Check whether you can convert sales, expenses, and total receivables into an infographic design that is interesting to view and easy to understand.
Check whether you can set repetitive actions and automate recurring tasks like creating and sending invoices, estimates, purchase orders, sales orders etc. In addition, check whether you can set payment reminders, so even if you miss reminding the client for payment, the software on your behalf can notify the client and help you get paid in time.
13. Client and Vendor Portal
If the software can provide the clients and vendors with their area to communicate directly from the finance software, eliminating long email threads. In short, your whole communication will also be in one place, and you don’t have to go and check back through old inboxes for any older references.
14. Mobile compliant
Check if you can download the software as an app on your mobile. It will help you to keep control of business transactions even when you are on the move.
Finance management is the soul of any business. If you manage it correctly, it’s easy to scale the enterprise to new heights. Manual management of finance may become messy and prone to errors.
A finance software to carry out financial activities in an automated way is the need of the hour. After the implementation of GST, it has become more inevitable than before. Therefore, we are noticing a high demand for finance software.
The economy is becoming more and more formal day by day. The legalities and guidelines governing financial processes are becoming more rigid and complex. To avoid hefty fines, and penalties, the best option for a company is to have finance software to streamline and automate their financial management.
Q.1. What is finance software?
Software that records all the financial activity within a company is finance software.
Q.2. How does it benefit a business?
There are several benefits a finance software offers to a business. It saves time, efficiently generates financial reports, syncs all financial data, and simplifies payroll, vendor billing, invoicing, tax filings, etc.
Q.3. What is the price of finance software?
It depends on the size of your business and team strength. However, small business finance software may start from INR 0 to INR 12,000 per month.