Every business needs different tools and technologies for efficient operations in the long run. The biggest reason why businesses leverage modern technology is to make sure they’re utilizing their resources efficiently.
ERP systems and accounting software are two of those tools. They are very important for an organization’s function. Both of these, however, have different utilities.
What is Accounting Software?
Accounting Softwares are used by organizations to deal with all the accounting procedures. These are specific and focused on accounting functions in particular. It is suited for the needs of the financial department.
Features of Accounting Software
Digitises the accounting process
The manual task of data entry is prone to errors. Apart from that, it is a mundane process that takes up a lot of time and energy of the accounting staff. A firm can’t go without financial transactions even for a day. The growth of any organization also comes with growth in these transactions. Digitizing accounting activities avoid clerical errors and reduce stress levels of administration. It secures the financial data with firewall protection, so any attack on it can be repelled.
Automates financial activities
The finance department handles a range of tasks. Free UK accounting software is key to making tasks easier. Managing payroll, keeping sufficient inventory, and determining credit periods are some of the jobs it can handle. These can be streamlined by bringing them under a single platform. The best free UK accounting software provides solutions that create a continuous workflow. Moreover, free UK accounting software can be integrated with banks and payment platforms. This makes generating bills and invoices simple. It automatically sets up recurring invoices. It provides an option to also customize the invoice format as per the business requirements.
Another task that this tool helps with is tax compliance. By using free UK accounting software, VAT can be calculated and paid. It also helps in filing timely returns, which directly go to the HMRC.
Gives detailed reports and aids financial decision making
One of the most useful features of the best free UK accounting software is that it creates detailed reports. By analyzing the data fed to it, statements can be created. The recorded transactions are summarised and presented in quick, comprehensible formats.
The best accounting software comes with a common dashboard. These can be customized to pick out relevant data without delay. It displays important facts and figures at a glance. The instant availability of key information is necessary for taking rapid decisions. To promote fast decision-making, having the best accounting software is paramount.
What is an ERP System?
The Enterprise Resource Planning System covers a wide spectrum of activities. It not only involves financial systems but also every other aspect of the organization. From human resources to supply chain management, it helps to optimize multiple professional processes. This makes the free UK accounting software a part of the overall ERP system.
Features of ERP System
Integrative force
Organizations are complex and divided into multiple departments. Each of these units is interrelated and co-dependent. Keeping data separate can cause delays in operations, confusion, and inefficiency. Having an ERP System integrates all information so it can be accessed wherever it is required. It enables the proper allocation of resources and reduces wastage. Having real-time insights allows organizations to capitalize on opportunities.
Overlooks Financial Management
ERP Systems also overlook financial aspects of the business. It is like an extended version of the best accounting software. Management of accounts payable and receivable, preparation of budgets, and asset management are some of its features. It includes the features of any free accounting software in the UK. It makes year-ends a much easier period to survive.
Maintains Customer Relationship
Beyond the inner workings of a firm, it is the customer that generates a ton of data. ERP systems integrate features of customer relationship management. It helps to keep a record of old purchases, transactions, queries, and new orders. Having all this information on a common platform helps avoid hindrances in the supply.
Facilitates sales and marketing
Having customer details and inventory information makes it easier for the marketing department to plan strategies. Customer profiles can give a better insight into segmentation. Sales can be boosted by providing solutions that appeal to a particular section. This is beneficial not just for the firm but also for the customers, who get the best deals. Having all this data in one place pushes the firm to evolve its marketing practices.
Handles human resource
ERP System also integrates the HR software. This loops in all employee-related tasks to the common system. Right from onboarding to termination of employment, all tasks in between are managed here. This ensures timely distribution of monthly payroll, explanation of tax benefits, and even appraisal planning. With this, the main operational aspects come under the common ERP System.
Put Simply, The Differences
To state this most simply, accounting software is a subset of ERP Systems. accounting software operates to digitize financial activities only. While the ERP system integrates all activities of a firm. Its purpose is to create a common platform where the activities of all departments are streamlined. This improves the overall efficiency of business management.