Small businesses across Canada are addicted to spreadsheets. Ask any small business owner how they manage anything related to numbers and it is rare to find them not using a spreadsheet. This makes sense when you’re starting out, because it keeps costs down, but as your business grows you’ll reach a stage where those “free” spreadsheets are costing you more time and money than you think.
Mistakes are Inevitable
In 2013, Market Watch’s Jeremy Olshan wrote that close to 90% of spreadsheets created contain errors, and in the same article a University of Hawaii IT professor was quoted as saying, “even after careful development, contain errors in 1% or more formula cells.”
The root cause of the problem is human error. Many people ignore the fact that building a spreadsheet is, in essence, a basic coding exercise and it only takes just one typo or misdirected cell to bring the credibility of your numbers crashing down. In many circumstances only the most eagle-eyed person will spot an error because spreadsheets are not programmed to alert you to mistakes unless it’s a formula error.
Choosing the Right Time to Transition from Spreadsheets
While your current spreadsheet may not be perfect, it is still a key component of running your business. Transitioning over to a new system during a busy period, or when you’re close to submitting figures to your accountant, is never a good idea. Numbers can become mixed up and then you’ll have more problems to deal with.
Instead, research what you’ll use in advance of month, quarter or year-end and time your move after you’ve closed the books for a specific financial period. By doing this you will worry less about migrating transactional data and can start fresh.
The Benefits of Accounting Software
Once you’ve made the move to an accounting software solution you’ll notice some pleasant changes:
- Confidence in Your Numbers
Whether you’re importing numbers from your bank or entering them manually, your financial position will be presented in an easy to understand dashboard that gives you and your stakeholders a clear view of your finances. This breeds confidence in your business and you as an individual.
- Less Time Spent on Numbers
Some people love playing with numbers, many don’t. You’ll notice a major time savings once you’ve moved to an accounting software like Sage One. You will be able to import and categorize transactions directly to your bank, allow clients to pay directly from their invoices by credit card, and be automatically notified of an invoice payment status.
- Reports that you don’t have to Build
Need a breakdown of your P&L for your bank manager or investor? How about understanding your tax position? Click a button and you have it. You don’t have to worry about building a report or asking your accountant to do it.
- Working with your Accountant Becomes a Breeze
When it’s time to go and see your accountant, you used to be armed with spreadsheets and a shoebox full of receipts and invoices – now you can just give your accountant access to your online accounting software account. By giving your accountant access to your accounting software he or she will be able to support you more often—and because you’re providing less hassle during tax time, they may even reduce your fees!
- One System for Many Things
Your spreadsheet can easily become a thing of the past for recording your income and expenses. You’ve probably been invoicing and recording card payments using other means—managing information in various places and manual entry of your calculations. When using an accounting software solution you’ll be managing everyday financial tasks with ease and because it’s one source for your numbers, you’ll only have to do them once. You’ll have peace of mind knowing everything is calculated correctly and you will have instant at-a-glance reporting--leaving more time for you to get back to your business and spend less time on your books.
About the Author
Keith Arkle is part of the Sage One team in Vancouver, BC. He has over 8 years’ experience in the small business software industry across Europe and North America. He regularly coaches small businesses to help them improve customer acquisition and productivity.