How To Work Smarter With Cloud Accounting

Key Benefits of Cloud Accounting 

Here are 4 ways cloud accounting can help you work smarter.

1. Automate invoicing workflow and speed up payment collection

The Covid-19 pandemic has completely transformed the global economic landscape and has brought many economies to a near-standstill with governments imposing all manners of lockdown in a desperate bid to contain the spread of the virus. Under such an uncertain business climate, it is more important than ever for small business owners to tighten their purse strings and manage their cash flows to survive this unprecedented crisis.

In order to budget and forecast cash flows accurately, it is important to invest in an accounting system that is able to generate accurate financial reports for cash flow analysis. Many small business owners are now switching to cloud accounting software with user-friendly financial reporting functions to harness the power of digital technology to better manage their businesses. Many are utilizing the invoicing function of cloud accounting software to electronically send sales invoices to customers to speed up billing and collection and to shorten their cash conversion cycle. 

Here are some other ways cloud accounting can help you automate your invoicing workflow and speed up your payment collection:

• Send invoices from any location using mobile application (iOS and Android)
• Seamlessly integrate sales data with financial reporting system to eliminate manual data entry and maintain data integrity
• Streamline workflow by automating invoicing (monthly, weekly, etc) for recurring sales transactions
• Set invoice reminders in the system to automate payment collection 

Allow easy online payment to customers by adding online payment gateways (like Stripe, PayPal, etc) to your invoices. According to Xero Blog, small businesses who enable Stripe payments on Xero invoices are already paid on average up to 15 days faster than those without any payment services attached (Read more here)

2. Drive profitability and gain visibility

The success of every business very much depends on the timely assessment of the profitability of individual projects. Most small business owners start off using simple excel spreadsheets to manually monitor the time and money spent on each project. However, as their businesses grow and the number of projects increase, it is no longer efficient to continue using manual tracking to manage their projects.

Xero Projects is a tool within Xero that helps you capture, track, and report the time and money spent on projects and jobs so that you can make better business decisions. Some of the key functions include:

• Creating fixed price, time and materials, or progress payment invoices
• Accurately tracking time on the go with stop-start timers and location-based tracking on mobile (both iOS and Android) – no more chasing timesheets (read more here)
• Ensuring your staff is working on the right things; see how your team’s time is spent on all projects with the Timesheets & Staff Time overview (read more here)
• Seeing how staff costs affect bottom lines; set an hourly cost rate for each staff member, so it’s easy to calculate overall profitability on a project

3. Manage company spending

Spenmo is a cloud-based payments software and offers a unified payment platform for businesses. They help you manage, track, automate, and reconcile your payments in one dashboard. Spenmo integrates fully with Xero for seamless bank reconciliation. Card and invoice payments made via Spenmo are seamlessly integrated with Xero with just one click of a button. Here are some ways Spenmo can automate your payments process and free up your time to build and grow your business:

• Automates your payments cycle and allows payments to be processed with only one click of a button
• Facilitates overseas transfers and automated bill payments at S$1 per transaction with 0% FX markup
• Top up your Spenmo account using your credit cards, and use Spenmo to pay for your rent, employees’ salaries and supplier invoices. Use the freed-up cash to grow your business and earn miles and points on your business payments
• Get instant access to physical and virtual corporate cards and assign them to all your employees with pre-approved funds to track spending in real-time. Create custom virtual cards with pre-assigned budgets to track subscriptions or marketing spend in one dashboard

4. Automate data entry

One of the key benefits of cloud accounting is the ability to integrate the accounting system with the rest of the operations to streamline workflows, reduce costs and improve employee productivity. Hubdoc is a data collection and management tool that is fully integrated with Xero and performs the following functions among others:

• Automatically files and organizes your digital files into separate folders for easy retrieval and document retention
• Allows users to forward documents to HubDoc using a customized email address or upload via a mobile application (iOS and Android)
• Its data capture function uses artificial intelligence and machine learning technology to extract information from uploaded documents for seamless recording into the cloud accounting software

Final Thoughts

Small business owners face a plethora of challenges, such as spending countless time and energy chasing overdue payments from customers, insufficient funds on hand to purchase inventory or settle outstanding bills due to lack of visibility of real-time cash flow position, and countless hours spent on expense claims administration, like chasing employees for claims submission, to name a few.

By helping small business owners work smarter, cloud accounting helps solve all these problems and frees up precious time for the small business owners to pursue the things that matter most – growing their businesses and serving their customers.

Speak to your accountant

As small business owners ourselves, we understand your pains of wearing multiple hats and juggling multiple tasks whilst having to stay cost-efficient simultaneously. We are proud to be a Xero partner who can help digitally transform your accounting function so that you can work smarter and faster. Schedule a free 30-minute consultation with us to discover how you can reclaim your time and grow your business.