Choosing an accountant or accounting software is the critical question every enterprise face at a certain point. Hiring an accountant or installing an accountant software has its share of pros and cons. As the technology has developed the complex systems of business has been made much more comfortable to have a perfect all-around view of the company. However, there is also a view that the human touch of expertise is much greater than machine operated work.
To know whether to hire an accountant or install software, here are the list of pros and cons of both methods.
The benefits of an accountant:
Professional accountants are well aware of the company’s goals and the financial situation of the company. They are quite adept at guiding the company on tax matters or advice the higher management on their proper use of funds. This can not be done by a software
Possible tax deductions:
Having a professional accountant can help the company save taxes wherever they can. The accountant would be qualified enough to find out the possibilities of legal tax saving allowed by the Income Tax department to business.
The detriments of accountant:
Hiring a well-qualified accountant for the company’s needs might be quite expensive than having an accounting software. Even for filing simple tax returns, the rate of charging will be quite high. Many accountants charge on an hourly basis which would be quite expensive especially for small businesses.
Finding the perfect accountant:
Many companies fail to check the background of the accountant before they hire them and end up paying a huge sum of money to a person who practically knows nothing about the subject. The businesses need to check the background, feedback from previous employers before hiring the accountant as they will be privy to the company’s sensitive information.
The plusses of an accounting software:
This is one of the best features of an accounting software. All the calculations and the reports are generated with a single click. Automation helps the company save time, money and hiring of the workforce to complete the job. A proper and versatile accounting software can also share information with other users through the mail or in different ways by softcopies in very less time. It makes everything seem so simple and organized.
The essential feature of any accounting system is that it has the ability to integrate with the pre-existing software. When opting for manual accounting and if there is a merger or a takeover, then the company also has to bear the cost of appointing accountants who pour over the books of accounts over and over again to make sure that the statements are in order. However, with the accounting software, the discrepancies can be found out quickly. There is no additional cost of hiring an extra workforce to get the job done. In mergers, the accounts of the companies can be fused easily.
The minus of the accounting software:
The fraud factor:
The information stored in the accounting software can be shared with multiple users thereby making it more prone to fraud and misleading activities. Extra layers of security have to be added to prevent this misdemeanor, and an internal team of accountants has to be on constant watch. This ultimately leads to a rise in expenses.
Additional upgrades and adequate training:
As accounting software operates online, it requires a constant upgrade with the hands-on training for employees to work with the system changes. This requires a purchase of additional software or appointing a professional for training the staff according to the latest updates. All this can be availed only after a payment of a fee which is detrimental to the business’s operating cost. Even though the software is user-friendly, it will take some time to understand the features and work with them. Professional training has to be done to avoid mistakes in the future.
Having an accountant or an accounting software has their own share of pros and cons. The businesses should evaluate their position and their needs before deciding what to pick. Nevertheless, both methods have the potential to maximize the business’s earnings. At the same time, it is also beneficial to factor in the infusion of an accountant and the accountant software to get the best of both worlds. In the end, it all comes down to the decision of the company.Tags: Accountants vs. Accounting Software, Accounting, accounting software, Small business