Before the age of computers, accountants had to have a separate notepad for a journal, ledger, accounts payable, accounts receivable, payroll, and trial balance. Nowadays, accountants can easily access these files using accounting software—accounting software functions as an accounting information system for businesses.
Just like cloud computing systems, accounting software may come from a third-party source, developed in-house by the organization, or a combination of third-party software with modifications. Accounting software may either be online based, which can be accessed anywhere or desktop-based which cuts down costs.
There are several types of accounting software. If you are a home user that supports an accounts payable type transaction, managing budgets, and simple account reconciliation at the lowest cost possible, then personal accounting software is the one for you.
At low-end markets, inexpensive accounting software is the best because they allow almost all general business accounting actions to be performed. The best part about low-end systems is that it does not cost that much, but most of them have adequate security and audit trails.
On the other hand, the mid-market covers a wide range of business accounting software that can cater to the needs of many national accounting standards. The mid-market also allows accounting in multiple currencies. Besides, this software also has an integrated add-on management information system.
Perhaps the most expensive type of accounting software is the enterprise resource planning software (EPS), which is for the high-end market. EPS usually has a long implementation period. The implementation of this software is often longer than six months.
Many of this software aim to change market dynamics. These are some of the types of software that you can have. The question that every business owner should answer is what accounting software you should get for your company. This question may be difficult, but if you require answers, you can always check this LiveCosts infographic.