Finance Software: What is it? ❘ 5 functionalities

Finance Software: Definition and main functionalities

The definition of finance software is management software that allows you to perform billing, sales and accounting operations in your company. It should be noted that there are numerous specific options for SMEs.

When we talk about a finance software to make invoices, we are used to the idea of automatic invoicing. And, in fact, you should know that this type of solution goes much further. In the end, these are comprehensive tools that allow you to carry out multiple operations. In addition, there are now specific alternatives for companies in different industries, which makes the work easier.

The truth is that software of this type is applied for multiple functionalities. The most important ones they address are the following:

1. Invoice configuration

The first thing you should know is that this type of software allows you to manage and configure invoices automatically, including all the necessary fields. This allows you to have the document, send it to the customer and store it, minimizing the risk of losses.

The software allows you to calculate the items and automatically include the corresponding discounts, withholdings and taxes. Furthermore, your company's and customer's details will also be included. This is the most well-known feature because it obviously simplifies the process. Usually the data has already been entered in a previous field, and it is sufficient to fill it in where appropriate.

However, it should be noted that invoices can have several formats. Firstly, there is the conventional invoice. On the other hand, the simplified invoice, or receipt (valid in some cases). Finally, bill payments. What is appropriate, in this case, is that you know well what your business sector is to take advantage of the software. There are companies that can use the three formats interchangeably, while others only use one or two.

Today, it should be noted that this is the most basic functionality of such software. However, you have to make sure that it does what you are looking for in the right way.

2. Control of expenditure and income

The control of expenditure and income is another of the functionalities of this software. And we add that it is highly effective because you have quick data on your company's asset situation.

The idea is that you can carry out a calculation, either monthly, quarterly, half-yearly or yearly. These data, on both income and expenditure, can be interpreted in raw or clean form. Ultimately, the key is that it is much easier for you to keep track of your finances and accounting, because here you also record the invoices that have actually been collected. In addition, alarms will also be included if something is pending.

The balances that may be drawn up are either official or unofficial. In any case, you can make entries directly and automatically, both for the balance sheet and the profit and loss account. In both cases, the 2007 General Accounting Plan will be implemented.

3. Payment management with the bank

Payment and collection management with the bank can also be carried out through finance software. The reason is that there is usually a complete integration that allows you to make decisions.

Saving time and making transactions easier is one of the aspects you need to know. For example, if you have several bank accounts, this is one of the best ways to centralise all the operations. You will also have access to the bank balance of all available accounts, which allows you to make other transactions. Consequently, if you want to manage your banking transactions in a comprehensive manner, this makes your work easier.

It is therefore interesting to know that this functionality is already incorporated in several financial software packages. And it is particularly useful in SMEs, as it greatly simplifies the work.

4. Reporting results with finance software

The results report is very interesting if you want to get a rough idea of how your business is doing. However, it should be noted that this report may include a variety of information.

The best-known document is usually the profit and loss statement for a given period. But you can also use this account to find out the turnover for a certain day or the sales with a certain customer. Depending on the type of company, these reports will be different, will cover different dates or different clients. In the age of Big Data and Artificial Intelligence (AI), having all this information at your fingertips allows you to plan wisely.

Therefore, performance reporting is another add-on that you can find in some finance software solutions. The key is that you have enough data to make other decisions in the future.

5. preparation of budgets

Budget preparation is another of the functionalities that are welcome when using this type of accounting software. In these cases, implementation can be done in two different ways.

The first possibility you have is to simulate a proforma document, making it clear that it is not official. However, another option that includes these solutions, and we recommend, is to create a specific budget; This is good for service companies, so it is worth it if you can put this kind of solution forward. Often, and especially for transactions of a certain amount, it is necessary to propose a quotation to the potential client in order for them to weigh up the offer.

In the end, it is a question of adapting your solution to the circumstances of your company. It is good, therefore, that you take this into account because, in certain companies, this function is very important.

Conclusion

Financial solutions are a very interesting solution, and especially if it has the right features. At SEIDOR you will find various options adapted to different types of companies, whether they are distribution, manufacturing or marketing companies. Contact us to find out more!