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The 9 essential financial management tools for businesses

Mar 7, 2021 | Tips

With accounting firms increasingly focused on providing businesses with sage advice around how to best run their operations, are you abreast of the financial management tools and technologies you should be recommending?

There’s a slew of important existing and emerging technologies you should be across in order to better understand the evolving needs of Australian businesses. Such knowledge will help you provide the most comprehensive and useful business advice possible.

1. Expense tracking

The ability to deftly manage business expenses sits at the top of the pile when looking at simplifying EOFY and compliance. Instead of poring over receipts, parsing out business expenses from personal expenses and engaging in manual calculations, expense tracking software takes over the entire process.

Key business benefits:

  • assists with budget control
  • sheds light on overspending issues
  • EOFY and taxation concerns are massively simplified
  • helps debt avoidance and unwise expenditure
  • grants confidence to expenditure
  • helps future expense prediction

 

2. Budgeting apps

One of the most common business problems, especially for those just starting out, is the effective management of available capital. Mismanagement of a budget, the failure to properly implement one, and the flippant proclivity to spend too much can derail an otherwise sound business very quickly. A budgeting app is essential to monitor and ensure intelligent and balanced use of available cash.

Key business benefits:

  • real time awareness of financial situation
  • reduces unnecessary expenditure
  • wards off financial complications and debt
  • gives confidence to growth and investment opportunities

 

3. Cashflow management

The ability to view, at a glance, the incomings and outgoings of a client’s business operations is an extremely useful function almost any business should have access to. Instead of tedious manual processes, a live, single window view of the current state of cashflow is indispensable.

Key business benefits:

  • reduce chances of financial overextension
  • ability to pay staff and bills on time
  • real time analysis of financial position
  • ease of engaging in business growth opportunities
  • better prediction of future cash position

 

4. Time tracking software

Time tracking software enables employees to track their time and submit entries on any device. This allows employees and managers to do their job fully and save hours on tedious admin tasks. For those who rely on time-based billing to produce profits, time tracking software is essential to streamlining the billing process, meet compliance requirements, and calculate cashflow.

Key business benefits:

  • deadline accuracy
  • effortless time capture
  • increased productivity
  • easy and accurate client invoicing and billing
  • employee financial performance tracking

 

5. Inventory management

If a business client is still reliant on spreadsheets or other inefficient and outmoded forms of inventory tracking – there’s a lot to gain from inventory management software. With inventory management software, a client can accurately gauge stock levels, predict upcoming requirements, and ensure product availability for customers.

Key business benefits:

  • low risk of overselling
  • higher customer satisfaction and reduced customer issues
  • less chance of budget overextension or unnecessary purchases
  • easy reporting and creation of balance sheets for EOFY

 

6. E-invoicing

If a business is predicated on invoicing to receive payment, e-invoicing is fast becoming a necessity. While manual invoicing processes are viable enough for the purposes of sending invoices, the disadvantages of this outmoded option are glaring.

Key business benefits:

  • ease and speed of invoice submission
  • lower levels of late payment or non-payment through ‘pay now’ functionality, read receipts and automated reminders
  • mobile enabled
  • error free storage for accounting and reporting purposes
  • easy

 

7. Mobile Cloud POS

Any business that takes payments in person will reap the benefits of modern and untethered Cloud POS solution. A game changer for retail micro start-ups and larger businesses alike. With the ability to roam, change storefronts, or move your business operations – this untethered payment collection set-up is a powerful tool.

Key business benefits:

  • anywhere, anytime payment collection
  • inventory management
  • sales management, reporting and analysis
  • employee management
  • integration with accounting and financial management software

 

8. Future of Open Bank data and tools

While it remains to be seen what kinds of new start-ups, tools and technologies will emerge, keeping an eye on the Open Banking space is recommended.

We may see new budgeting and cashflow tools, investment apps, better access to data and new roles for accountants. Advisors may soon be able to access much richer banking and business data, leading to more enhanced advice value.

The savvy accountant will be watching closely to see what kind of fintech products and financial tools emerge from the advent of Open Banking.

 

9. Cloud accounting

You knew this was coming. It’s still a strange phenomenon to see that many Australian businesses still haven’t embraced cloud accounting solutions. Apart from the inherently obvious benefit for both accountant and business alike, there’s a lot to gain from smart integrations with the aforementioned tools.

While many businesses make basic use of cloud accounting, there’s a lot of room left for more fulsome and in-depth use of such powerful software. If your clients don’t integrate with other financial management tools, have too many siloed platforms or don’t make use of certain available functions, their job and your own become needlessly complex.

 

To find out more about APS software, visit www.aps-software.com.

APS is a division of Reckon, an ASX listed company. We develop the software used by the best Accounting Firms in Australia and New Zealand to run their business’ and advise their clients.