In this day and age of cloud computing, mobile apps and so on, the spreadsheet really has had its day when it comes to your accounting system. Why? While it may seem like a very cheap or free option, using an accounting spreadsheet can severely limit your options.
There are a few danger signs to be aware of and it’s not something we often recommend our clients do at all – especially given the many free or cheap cloud accounting solutions out there that offer so much more than a simple spreadsheet can ever do.
Here are my top five reasons for kicking your spreadsheet into touch and updating your accounting system…
1 Why reinvent the wheel?
There are so many professional accounting systems, why spend time inventing your own and having to update it as your business grows and you need more functionality?
2 Less chance of mistakes
If I had a pound for every spreadsheet I’d been sent that didn’t add up .... Yes it can happen – someone changes a formula, adds a cell, overrides a calculation, etc. Even when the sheet has been designed and provided by an accountant, it doesn’t mean mistakes can’t happen.
3 Better control
Are you in control of all aspects of your finances through your accounting spreadsheet? Does it tell you how much your turnover is, what profit you have made, what your cashflow looks like, how much tax you must pay at the end of the year?
4 Room for growth
As your business grows and you need more from your accounting system, will your spreadsheet be able to provide it without additional effort, set up, formulae, etc? Will the accounting spreadsheet hold you back and result in more of your valuable time being spent on bookkeeping and basic accounting tasks, when you should be focusing on growing your business?
5 Added peace of mind
How often do you back up your PC? What if your PC gets stolen or breaks? Is your PC the only place that you can access your accounting records from? Food for thought, when keeping your accounting spreadsheet on your local machine.
And finally ....
Make sure your accounting system is a 21st century, fit-for-purpose solution for your business.