Everything is electronic nowadays, so how exactly does any electronic device work? Our brain is responsible for controlling and running every part of our body. Likewise, the software is also responsible for running and controlling electronic parts. Software is an important term that we all should be familiar with as this generation is moving smoothly and rapidly towards the digital world.
After all, this is the era of digitization, and just about everything is done digitally, including accounting. That said -
What is software?
Software, in its essence, is a bunch of codes in programming languages like c, java, etc. The lines of code control for the overall program can be customized to do just about anything within the confines of the available technology.
The software acts as the brain of electronic devices and triggers every function that runs the device. Popular devices like our laptops, applications like Facebook, games, etc., all run on software.
There are three major types of software.
They provide an education-related, business-related, or person-specific function to the end-user. Popular examples include browsers like chrome, firefox and applications like Microsoft word, Facebook, etc.
It is considered the interface or bridge between the hardware and user application that runs most of the hardware and applications programs.
A popular example is the operating system of a computer or mobile phone.
They are the most commonly known software development tool to make other software. Well-known examples are compilers, debuggers, interpreters, and assemblers.
What is accounting?
Accounting is a powerful term connected with business. Regardless of their scale, every business involves various financial transactions, and accounting is the process of recording every such transaction.
Good accounting makes a business successful in a very short period. With excellent software and manpower, very complicated and vast transactions also become easy. One salient feature of accounting is acquiring and providing qualitative and quantitative knowledge to make successful economic decisions.
Accounting is all about Debits and Credit. Expenses and losses are known as debits, whereas income and gains are known as Credit.
3 Golden rules of accounting
Regardless of your business's scale or size, the accounting process will always follow a similar pattern. Sure, there will be differences depending on the organization, but the core of accounting is to manage the accounts receivable, inventory management, and accounts payable. The task shifts to preparing a budget plan and other additional procedures.
That said, there are enough subtle differences between the organizations to make the accounting of each organization different and unique. The good news is that three golden rules act as both the guide and an unbreakable code to follow.
Rule 1: Debit the giver, Credit the receiver
Regardless of what organization you go to or the type of accounting you are involved in, the one paying to the company - the giver- will always be put under the term of Debit. At the same time, the one receiving the payment from the company will always be considered the patent.
Regardless of the accounting system, this is golden that everyone must follow.
This rule is used for the accounting of personal accounts.
Rule 2: What comes in Debit, What goes out of Credit
This rule is similar to rule the first, and it is quite simple to understand. All the accounts payable, i.e., the money/assets that go out, will be considered credible. Similarly, all the accounts receivable, i.e., what comes in, will be considered Debit.
This is the rule for real accounts.
Rule 3: Debit the expense and credit the gains
As per this golden rule, all expenses and losses will be termed debits. Along with this, all gains and incomes will be termed as Credit. While this sounds a bit different from the previous two rules, this rule is used for Nomina accounts, which are individual accounts on their own.
There are three major types of software. They are:
- Personal accounts: The accounts used by an individual for personal use
- Real accounts: Accounts that deal with assets and properties.
- Nominal accounts: Accounts that deal with gains and losses, usually related to businesses.
What is Accounting Software?
Accounting software falls under the application software category. It is application-specific or business-related software that deals with transactions. It records all the transactions and processes them accordingly. There are many accounting software made for small and big businesses. The quality varies according to the business type. Many software is free for small businesses, but high-quality software costs money. Some might be very expensive. Some examples of accounting software are Intuit QuickBooks Online, Plooto, Oracle NetSuite, FreshBooks, Zoho Books, etc.
Three popular accounting software for business and private bank account owners
In this growing age of technology, new accounting software comes out every season. However, there are three that stand out among the rest. This three software has established themselves as the best among the rest.
While the reasons vary, the ones below are definitely among the best.
QuickBooks is one of the popular accounting software released by Intuit Inc. in 1983. However, its stable release was introduced in the year 2019. It runs on windows globally, but the USA has its macOS release too.
This simple but highly efficient accounting software is popular for managing all forms of bank accounts, credit card information, tracking expenses, and business growth. Some more reasons why Inuit Quickbooks is one of the best:
- Focused highly on small and medium-sized businesses and financial transactions.
- Provides both on-premises and cloud-based versions to customers.
- It makes it very easy to manage complicated financial transactions.
- Managing and paying bills becomes easy and transparent.
- Intuit QuickBooks Online is the cloud service/ online accounting software, where customers pay a monthly subscription fee instead of an upfront fee to access it.
- Some of its salient features include:
- Remote payroll assistance and outsourcing
- Remote access capabilities
- Electronic/ online payment functions
- Online banking
- mapping features with Google map
- Microsoft Outlook and Outlook Express enabled improved emailing service.
Developed by 2ndSite Inc., Freshbooks is another famous accounting/ management software. It provides services to both PC and mobile devices. Founded in the year 2004, FreshBooks' main jobs are creating invoices, tracking expenses and time, providing reports on various transactions, design estimates, etc. Essentially, it is an inventory management software to aid in financial transaction management for business owners.
Some of the reasons why Freshbooks is popular are:
- FreshBooks provides subscription-based services to its users where they can pay monthly or yearly.
- Headquarters is located in Toronto, Canada.
- It makes it easy to track the expenses of complicated transactions while providing reports on various design estimates.
- Mostly used in tax collection for transparency.
- Some major roles and features include:
- Expense tracking,
- Time tracking,
- Services like fixed asset depreciation,
- Purchase orders,
- Payroll integrations,
- Double-entry accounting,
- Management reporting
- Expense Tracking
- Financial forecasts
- and more!
Zoho Books is a complete online accounting software especially to manage and automate your finances and other business workflows, providing transparency and flexibility. It is available for Windows, Android, and iOS devices, making it easier to operate anywhere. Zoho Books is one of the best accounting software for business owners managing all their financial transactions and bank accounts. Along with this, Zoho Books also has decent Artificial intelligence. This essentially allows the business owners to track their progress as their business grows.
Some more reasons why Zoho Books is among the best are:
- Integrated with amazon.in
- It has a free and paid version
- Businesses having less than Rs 1.5 crore turnover can access it freely under its new scheme.
- Very popular among people with 15+ million active users.
- Available in multiple languages like English, French, Chinese, Japanese, Spanish, etc.
- Important features include:
- Customer engagement is very high due to the user-friendly interface.
- Sends and tracks invoices effectively
- Well-integrated with Stripe (which improves reconciliation)
- It manages and tracks your projects
- Obstacles eliminated between various accounting departments and sales
- Effective inventory and stock management
- Saves time through various workflow automation.
- Fully responsive and mobile-compatibility
In the end,
Naturally, there are much more accounting software for businesses and everyday use than we mentioned here.
Accounting is a tough job, especially for a business that constantly grows. Therefore, there are a lot of data involved, which can be quite troublesome. Because of this, there is a constant need for artificial intelligence in this field. Having AI as an assistant is helpful for automated invoices, data analysis/ processing, credit card information management, and more.
The good news is that we are in the age of technology - with great progress each year.
We hope you found this interesting. And as always, thank you for reading till the end.