Top accounting practices your business should follow

Top accounting practices your business should follow

Accounting is one of the busiest departments in any organization. Whether it’s maintaining financial records, computing taxes, tracking expenses, or updating the books, it’s easy to see why most accounting teams always feel overwhelmed with work. Furthermore, each process can be complicated and requires several people’s attention and or approval. If such tasks are handled poorly, your business can suffer major efficiencies.

To assure your operations runn smoothly, here are five best practices your accounting department must adopt.

Digitize your records

Mistakes are inevitable when documents are entered into your accounting database by hand. For instance, employees could misplace important invoices or enter the wrong details into the system. Even the tiniest error could have large implications on your bottom line, which is why it’s important to digitize paperwork with document management systems (DMS) like PaperSave.

Related article: Establishing a digital paper trail through process automation

Cutting-edge DMS software solutions come with optical character recognition and machine learning features that extract data from a scanned document and enter the information directly into a database with little to no human oversight necessary. The software can also be programmed to tag documents with keywords and dates, so they’re easy to retrieve once they’ve been scanned in.

Centralize everything

Your accounting department often relies on other departments for financial data. But rather than manually requesting information from each department, best practice is to share data in a centralized system. When a cloud-based DMS software is integrated with your accounting database, accountants can retrieve the documents they need with a simple search query and gain complete visibility over the company’s financial condition.

Related article: Centralized workflow management for accounting department

Set strict deadlines

Establishing rigid deadlines for the company regarding the submission of invoices, tax returns, reimbursements, and other requests is critical in accounting. For one, keeping up with deadlines helps you meet client expectations and secure early payment discounts from vendors. Secondly, failing to meet deadlines results in financial penalties, recalled loans, broken contracts, and loss of customer trust.

Beyond simply setting deadlines, you must also be able to enforce them. PaperSave is the best solution for this because it allows you to send auto-generated email reminders at predetermined intervals as deadlines approach. Another option is to make frequent company-wide announcements. If deadline issues persist, PaperSave’s audit trail features let you easily track the offenders, so you can reprimand and retrain them.

Automate, automate, automate

As your business grows, You may not be able to control every manual and redundant task. Over time, dozens of invoices and documents will flood your office, and your accounting staff will have to spend more hours of their day tending to repetitive and mundane tasks.

Related article: How workflow automation and smart forms streamline processes

The best way to manage these issues is with electronic workflows. This feature, which is indispensable in modern DMS software, allows you to design workflows that automate repetitive, multi-step processes. For example, you can create workflows that route purchase orders to approval managers so they can be paid and shipped. Automated workflows can also be designed for invoicing, data verification, bank reconciliation, and more.

As a business owner, you should constantly be looking for opportunities to automate tasks. With workflow automation, you’ll streamline operations, save your employees from tedious work, and give them the chance to focus on more important jobs.

Evaluate your processes regularly

Even after digitizing, centralizing, and automating your accounting department, it’s wise to review your processes once or twice a year. This helps you identify bottlenecks that must be addressed. You may find that employees don’t know what to focus their efforts on when everything has been automated, in which case you’ll need to assign them new tasks.

Related article: Build an effective automation strategy for your AP department

Regularly asking other departments and experts what steps can be eliminated from your accounting workflows can also go a long way toward improving business efficiency.

Managing an accounting department may be tough, but it doesn’t have to be when you have the right tools for the job. PaperSave DMS will make your accounting department run seamlessly. Just take it for a spin with our free personalized demo, and you’ll understand why.