Components of the Best Business Accounting Software System

The best business accounting software's components

Accounting software is much than the receivable and payable accounts, invoicing and billing, general ledger, and other standard elements. Accounting software is a complex and comprehensive system combining financial accounting and managerial accounting.

Financial accounting includes processes of the recording, summarizing and reporting the financial transactions that are a result of the business operations over some period. Summarized financial transactions are recorded in the financial statements that present the next main financial data:

  • Assets – economic resources that a company owns or controls and currently produce or can produce in the future the positive economic value. 
  • Expenses – economic costs a company undergoes because of its business operations aimed to earn revenue during a specific period. 
  • Revenues – the amount of money that a company receives from its business activities during a specific period. 
  • Liabilities – financial debt and obligations which a company has gained during its business activity. 
  • Equity – the assets value less the amount of all liabilities of those assets.

So, financial accounting data gives a full picture of the company's operating performance during a specified period.

Managerial accounting includes processes of the measuring, identifying, interpreting, analyzing, and communicating information for the purpose to achieve the company's goals.

The main difference between financial and managerial accounting is in the information they provide:

  • Managerial accounting focuses on collecting, processing, and reporting information for internal users (managers, executives, analytics, and other) within the company with the purpose to plan, control and improve business operations and make better business decisions.
  • Financial accounting focuses on collecting, processing, and reporting information for external users (investors, creditors, banks, government agencies, auditors, and others) outside the company for different purposes.

Each company that is anxious for success should choose the best business accounting software system which meets all, even smallest, company's necessities of two main fields: management and finance. Only the best business accounting software solution can give the company, regardless of its size, the maximum benefits, including:

  • increasing the speed of accounts processing via optimization the financial processes,
  • automatically production of financial statements and other documents, 
  • increasing accuracy and reducing errors in financial reports, 
  • reducing the overall costs.