Imagine driving a car without a dashboard that allows you to view crucial information like current speed and fuel or oil levels. Not only will you not be able to drive your car effectively, but you could end up stranded or even blowing out your engine. The same applies to a business’ finances. Without being able to really visualize and track the different transactions and information influencing your business, you can’t successfully drive or maneuver it.
One way companies avoid financial losses and align business strategies is by adding visibility into the accounting process, which is easily attainable with modern software. A visible accounting system helps you track your finances more easily while bolstering collaboration throughout your organization. This emphasis on visibility and collaboration helps organizations eliminate errors that might have gone unnoticed while also creating a comprehensive view of how the business is performing.
6 Benefits of a Visible Accounting System
Increasingly, companies are demanding faster, more reliable data. Relying on outdated accounting details will cripple your organization because you’re not taking the current expenses and cash flow that drives your company into consideration. The challenge then is to ensure this data is accurate and current. Additionally, companies still need to monitor financial transactions to make sure all accounts are managed correctly and efficiently. A visible accounting system achieves this while also broadening the scope of what you’re actually able to examine. This is because system visibility redefines how the different dimensions of your organization can collaborate to achieve financial goals.
Instead of a siloed accounting feature, an innovative accounting application like Accounting Seed allows the entire business to link all data into a single system. In addition to making the finances of each business component visible, the details surrounding these amounts are now visible as well. This lets individuals and teams collectively view the broader picture of the company’s finances to make lasting impacts on the business. Here’s a brief look at the benefits of a visible accounting system:
The more visible your accounting process is, the easier you can gauge your organization’s financial health. As your organization expands with more people, departments, and expenses, this is something you and your team need to be aware of so you can effectively allocate funds and conserve budgets. This creates a sense of accountability throughout your organization, both in achieving goals and documenting finances appropriately. As an added bonus, this will help your team create and maintain good accounting habits for consistent performance.
2. Enhanced Accuracy
A visible, collaborative accounting system gives you enhanced quality control of the entire accounting lifecycle by enabling multiple team members to validate financial entries. Team revisions and a collective monitoring of data reduce errors in what’s being shared and documented. This helps your team eliminate duplicate financial data in your accounting system that can lead to confusion and inaccuracies, instead, giving you a single version of the truth throughout your business. Instead of having different variations of the accounts, the team will be able to analyze the same information. Working as an entire unit, instead of siloed departments, you gain a 360-degree understanding of your company’s financials that is much more accurate and reliable.
3. Better Resource Management
When the entire team contributes toward monitoring and understanding the business’ finances, a fully objective view of expenses throughout the organization becomes clear. All vendor costs and department expenses can be clearly examined, compared, and grouped in a visible accounting system- just like a car’s dashboard. The team can actively assess each tool and resource and have conversations on the return on investment for each item. Instead of guessing whether a vendor or resource is effective, the whole organization will have concrete numbers to analyze. This is important for determining how to allocate funds and deciding what the company needs and doesn’t need in order to be successful. Your team will be able to pinpoint areas of revenue drain and work together to shift around the budget to make the most out of resources.
4. Decision Innovation
Financial visibility allows management to be aware of real-time accounting constraints so that they can mitigate costs and use resources more effectively. This gives you access to an infinite amount of data much faster. Because the visible system is geared towards collaboration and quality control, you’ll be able to harness accurate information from any dimension of the business you choose. You will be better informed than you would be in any siloed accounting software because the factors behind the numbers are clearly visible and trackable. Team members will be able to pull specific details needed for inquiry or reporting purposes to develop the best-informed strategies possible. Understanding how each aspect of the business comes together lets your team make lasting improvements that benefit the whole organization.
5. Workload Optimization
Collaboration and visibility work to help you develop a streamlined accounting process due to your team’s easy access to key information. Everyone from vendors and customers to team leads and managers will be able to see accounting details in real-time which allows them to respond faster. This also means that accounting deliverables, corrections, payments, and even inventory tasks can be monitored and completed with more efficiency.
As your business grows, your accounting system needs to be able to accommodate the growth. A visible, collaborative system will ensure that you have a tool that continues to provide insight into the new variables that come with increasing productivity and staff. The more visible your accounting system, the more you and your team can collaborate on guiding company growth. This will actually enable you to keep improving your business because your team will be more aware of how to maintain operations effectively. A straightforward accounting cycle that staff can easily monitor and verify will help streamline core functions even as new steps and resources are added.
Collaboration Is Innovation
One of the major changes a visible, collaborative accounting software like Accounting Seed brings is the idea that accounting is not a solitary factor in a business. The reality is that accounting and financial management are veins that unite the entire organization. Every department and tool used within a company touches the company’s finances, so all these factors need to be visible to gain a complete understanding of financial health. Beyond account accuracy, collaboration is essential for creating strategies that impact the business in a holistic way.