Online Bookkeeping Tools for Non-Accountants to Manage Finances Easily

Introduction

Keeping financial accounts daily can prove to be a challenge for many. Since the income and expenditures are not documented regularly in the accounts, it proves to be difficult to gauge the situation later. Accounting principles and terms prove to be confusing for people who are not accountants.

However, in the last few years, online bookkeeping tools have been dealing with this issue in a different manner. These online tools have been able to arrange the income, expenses, and transactions in an automated manner. This enables the concerned person to have a clear view of the matter. Instead of having complex ledgers now, one gets to have a clear summary.

In this manner, accounting is no longer learning by rote in accordance with certain rules but rather learning to understand money flow. A person who is not an accounting professional is able to understand financial statements more effectively.

What Is Bookkeeping?

Bookkeeping is a straightforward and simple record of all the money transactions that occur in a business. Money came in, money was spent, customers paid, or money was left over – that is bookkeeping. Many people who are not accountants memorise everything at first, but later on, they forget the expenses and do not know the real profit.

A typical example is found in many small businesses – if there is money in the bank, then everything is going well, but by the end of the month, it is found that there are no savings. This is because there is no record of the income and expenses. When all transactions are recorded properly, then we have factual knowledge, not an estimate, of how the business is going.In simple terms, bookkeeping is not math but the financial facts of a business, which shows where the money came from and where it went.

Online Bookkeeping Tools for Non-Accountants

1. Bench

Bench Accounting is a software that helps small businesses manage their accounts in an easy way. It is an online-based accounting system. It is a combination of technology and human assistance, which helps keep the information correct. It helps manage the information required for income, expenses, reports, and taxes. The best part is that the user can access the accounts at any time and from anywhere. The advantage is that it is easy to use, and professional bookkeepers assist in managing accounts.

Features :

1.  Cloud-based access, which allows the user to open the data from anywhere.
2.  Income and expenses are automatically categorised.
3. Reports like profit-loss, balance sheets, and cash flow are generated.
4. It mainly focuses on bookkeeping and financial reports rather than invoicing.
5. The information required for tax is kept ready.

2. Kashoo

Kashoo is an online accounting program. It is primarily used for small businesses or for people who are self-employed. It has different features that are used for creating invoices, tracking expenses, reconciling bank accounts, or generating financial reports. The programme is so simple that a common person can easily understand it. There is no requirement for special knowledge of accounting. It is available on both web and mobile devices, so a person can work from anywhere. All information required for taxes is available at a single place, so taxes are easily filed.

Features :

1.  Reconciliation of bank accounts is possible.
2. Financial reports are generated.
3. Data is available for taxes.
4. Multi-user functionality is available.
5. Invoices are created, and payments are recorded.

3. OneUp

OneUp is a software for accounting and business management. It is for small and medium-sized businesses. It can be used for accounting, invoicing, and managing the stock. The software is connected to the accounts, which means that the transactions are done automatically. The accounts can be accessed at any time using the mobile application as well.

Features :

1. The transactions are automatically sorted using the OneUp software. This is done by connecting the accounts to the system.
2. The information related to the stocks is managed using the OneUp system.
3. The customer information is managed along with the sales using the OneUp system.
4. The sales orders can be converted to invoices using the OneUp system.
5. The accounts can be accessed using the mobile application.

4. Sunrise

Sunrise is an accounting tool available online. It is helpful for individuals who are either freelancers or small business owners. It helps them with features such as double-entry accounting, billing, and expense tracking. It can be linked with bank information for better organisation of transactions. It helps individuals manage their financial information with ease. Additional help with bookkeeping is also available if required.

Features :

1. Automatically record and reconcile bank transactions.
2. Track and organise expense and income entries.
3. Prepare separate accounts by project or department.
4. Manage payments and collections in foreign currencies.
5. Manage bill and payment entries.

5. ZipBooks

ZipBooks is a cloud-based accounting software solution intended for small businesses, freelancers, and startups. It helps users easily generate invoices, record expenses, and reconcile bank transactions. It comes with tools for generating financial reports and tracking data. It also comes with features for team management and tracking time. The interface is simple, making it a quick and easy process for managing data.

Features :

1. Transactions between banks and credit cards are linked and sequenced within the software.
2. Recording of bills and payments is done simultaneously within the software.
3. It can generate financial reports, including income, expenses and balances.
4. Project and time tracking can be linked with invoices directly within the software.
5. Integration with other business applications is possible.

How Non-Accountants Can Read & Understand Financial Reports

Most people believe that financial statements are only prepared for accountants. People get puzzled at the start because of large figures and unfamiliar words. However, the truth is that the statement is prepared to indicate the position of the business in a simple manner. If it is understood step by step, it can be easily comprehended without any knowledge of accounting.

Understand Income First

The first thing is to understand how much money has come into the business in total. This will help understand whether sales are really going up or just looking busy. Most of the time, even if the orders are high, the income is low because of pending payments. The income statement shows the earning power of the business.

Identify Major Expenses

It is essential to understand where the money is going the most. Expenses such as salaries, rent, purchase, or marketing directly affect the business. Once major expenses are known, it is understood why profits are going down. Most of the time, small expenses make a large difference.

Check Profit or Loss

What is left after all expenses is the actual performance of the business. Big sales do not always mean big profit. The profit statement reveals whether the business is creating value or simply moving money around. This is the figure that helps in understanding long-term stability.

Understand Cash Flow

Cash flow explains why there is less cash in hand despite showing profit. Many businesses are profitable but have cash flow problems to meet daily expenses. Late payment or advance purchase from customers impacts cash flow. Cash flow has a role like the daily breathing of the business.

View Outstanding & Pending Payments

Viewing how much money is due and how much money is to be paid helps in understanding the future pressure. Many times profit is visible, but money is stuck. Outstanding payments help in following up on payments and can prevent sudden cash shortages.

Month-to-Month Comparison

One month's data is not sufficient. Comparing it with the previous month or last year will reveal actual growth.Comparison is more helpful in seasonal businesses to know whether the slowdown is temporary or a genuine issue.

Identifying Expense Trends

It is difficult to identify which expenses are rising gradually every month.Comparison of reports helps identify the hidden rise in expenses.Identifying this trend will help control unnecessary expenses in time, or otherwise, heavy losses will be incurred after a long period.

Pay attention to simple ratios

Simple ratios such as profit margin help identify the efficiency of the business.This is not a complicated calculation but a quick check.If the profit falls while the income remains the same, it is understood that expenses are rising or pricing is not correct.

Understanding Graphs and Visual Reports

Graphs and charts give a quicker understanding than figures.The overall trend is visible without having to refer to long columns of figures.Visual reports are more helpful for non-accounting people, as trends are visible at a glance.

Understanding the Story Behind the Numbers

A report is more than numbers; it is the story that the numbers tell about the business. Why is there no profit despite the rise in sales? Why is the cash flow not improving?The answers to these questions lie in the report itself. When numbers are looked at as a story, decision-making becomes simpler.

Conclusion

The online bookkeeping systems also make it easier for non-accountants to understand bookkeeping. The system converts bookkeeping into a computer-based routine. This means that the bookkeeping is done in a computer system where errors are corrected digitally. The system also automatically arranges notes. This means that accounting knowledge is no longer required in making straightforward changes.

Such tools help people remain connected with their finances by translating transactions into understandable forms, creating organised finances, and keeping track of finances over time. Such tools are not used for proper account management but help make the process easier by translating day-to-day finances into understandable patterns.