What You Need to Know About Popular Software - Accounting Software

By Levi Reiss Platinum Quality Author


Accounting software is application software that records and processes accounting transactions, providing an accounting information system. This software may be developed in-house or purchased and perhaps modified to meet the purchaser's specific needs. Accounting software usually consists of several modules, which handle different accounting functions. Common modules include: Accounts receivable processing monies received by the company, Accounts payable handles paying the company's bills, Billing generating invoices, Payroll paying employees, Purchase Order ordering inventory, Sales Order recording customer orders, Stock processing the inventory, and General ledger, which summarizes the company's financial transactions.

Whether developed in house, purchased off the shelf, or even a combination of the two, this software must be applied in function of the company's chart of accounts and actual accounting data. The system must always respect the way that the company does business. The cost of implementation such a system often far exceeds the cost of the software itself. Successfully implementing accounting software requires careful planning and an experienced team composed of both accounting and computer specialists.

There are several categories of accounting software, depending on purchaser's needs. Personal Accounting software is the simplest, cheapest version. Families use this software to pay their bills, manage their budgets, and balance their checkbooks. Low-end accounting software for businesses handles simple, general business accounting functions. Many of these products employ the single-entry accounting method, rather than the double-entry method used in traditional accounting systems. They may not meet national accountancy standards such as providing audit trails.

Mid-market accounting systems meet national accountancy standards. Many of them meet multiple standards and are able to do accounting in several currencies. They may also include management information systems based on the accounting data. High-end accounting software may be integrated with other business software such as enterprise resource planning. Such systems must be heavily customized in order to meet the company or organization's way of doing business.

Some business accounting software is designed for specific industries such as construction or retail. For example, a fruit and vegetable store may sell some items by the pound, others by the case, and others individually. A good system will help the owners manage their specific business. I remember years ago talking at a party with a fruit store owner who spent months teaching a computer analyst enough about his business to help computerized it properly. Such a system helps the owner manage the business rather than serving an as obstacle to efficient, effective business management.

Levi Reiss has authored or co-authored ten books on computers and the Internet. He teaches Linux and Windows operating systems plus other computer courses at an Ontario French-language community college. His brand-new site http://www.php4windows.com shows you how to download (legally and for free) PHP and work with this software. For a break from computers check out his global wine website at http://www.theworldwidewine.com with his new weekly column reviewing $10 wines.

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