Bank feeds
Using an accounting software which imports bank feeds can be a significant productivity boost for CFOs and their teams. Manually entering bank transactions or inputting CSV files into the accounting software is time consuming and can create errors. Even if mistakes are spotted at the end of the month, correcting them adds more work.
Thanks to Open Banking integrations, bank feeds can be safely imported directly into the accounting software. In the UK, Open Banking feeds are available for the nine largest CMA 9 banks. Moreover, Bank Feed software can import transactions from bank accounts and be categorised in the accounting software in just one click.
Next level automation
Wherever possible, choose an accounting software that has automation features to enhance the finance team’s productivity. Software providers, such as QuickBooks and Xero, allow users to log assets, set their depreciation policy, and elaborate recurring journals.
Another automation example is releasing prepayments for annual contracts so they are smoothed out over their respective periods. Manual prepayments adjustments and reconciliation schedules are time consuming, and differences often occur from manual entries.
Bank reconciliation automation reduces the likelihood of duplicate payments to suppliers. This reconciliation can be faster by setting up rules to automatically post transactions with specific keywords to the relevant category, with the appropriate VAT rate. Another benefit is that bank lines are automatically matched to invoices by recognising their supplier name and same value.
Third-party apps
Many leading cloud accounting providers integrate with third-party software tools through their own marketplaces via open APIs. Enabling CFOs to build their own app stacks aligned to the needs and nuances of their business.
Leading categories in these app marketplaces include inventory management (Unleashed), cash flow forecasting (Futrli, Fluidly,), payment tools (Stripe, GoCardless, and Square), and expense management software.
Payhawk is the only finance platform that combines corporate Visa cards, payments, expenses, invoice handling and pre-accounting into one integrated experience. Allowing CFOs to have maximum control and visibility over their company spend.
MTD Capability
The MTD initiative was first rolled out in April 2019 for VAT registered businesses above the VAT threshold (£85,000). In April next year all VAT registered businesses will have to comply with MTD.
MTD for Corporation Tax and will not mandate its usage before 2026. If you need to switch to an MTD software, find here a complete list of MTD compatible software vendors.
Consolidation capabilities
Company groups CFOs should consider utilising accounting software that can consolidate data across all companies, no matter where they are based. Surprisingly many groups still consolidate manually in Excel at the end of the month. This is hugely inefficient and time consuming. Additionally, this makes it easy to generate mistakes related to currency conversion and transfers.
Using an accounting software that consolidates at group level minimises the chance of errors due to automated reporting. Moreover, it applies consistent accounting treatment for specific categories of transactions that are recognised across all companies.
Netsuite, Oracle, and Sage allow for consolidation directly into their software, but Xero and QuickBooks, more focused on SMEs, do not allow for inter-company consolidations. To solve this, third party add-ons, such as Spotlight Reporting and Fathom, can pull data from core cloud software to create group consolidations.
Conclusion
CFOs should take the time to understand day to day financial processes and company needs to choose the right accounting software. Being able to access accurate and timely financial data will allow them to be agile and make strategic decisions easily. CFOs should include key internal stakeholders who are involved in day to day financial tasks to have a stake in deciding the accounting software.
USA
Nederland
