Accounting and Inventory Management
Accounting has somewhat stayed limited to traditional bookkeeping in many businesses, especially the small ones. The traditional way to maintain ledgers is very cumbersome and error-prone. Add to that the need to hire an accountant to help with the tax returns filings and help with determining the cash flow and profits.
Any business activity is incomplete without accounting. Accounting is a barometer which shows the financial position of any business. Thus, accounting is important for any business. For any business managing their inventory is one of the most important tasks and without proper Inventory management, business process will not move smoothly. Now, let us gather some info on Accounting and Inventory Management.
Accounting is the process of systematically recording, measuring, and communicating information about financial transactions. Accounting can be divided into several fields including financial accounting, management accounting, external auditing, tax accounting and cost accounting.
Inventory or stocks are the lifelines of a company or business, and managing it properly is what makes the difference between company’s success or failure. Regular usage of inventory management software can help in the same and can keep a check on overstocking of product and outages.
Using Excel for managing inventory is a time-consuming process and it results in many errors. This is where inventory management software plays an important role. It has a feature to track, manage and organize product sales, material purchases, and other production processes.
There are many Inventory Management Softwares out there, which are specifically designed for inventory management. But inventory management is an integral part of accounts, thus developers have integrated inventory management with accounting software and made work of any business house simplified.
Accounting Software with Inventory Management:
In the digital era, many accounting software has emerged in the market which is changing the whole bookkeeping scenario with their new look and added features to cater different needs. They are easy to understand and use. Now, what if you can have an accounting software with an already integrated inventory management system in it?
The answer to this question is simple. An accounting software with inventory management features solves lots of problems faced by businesses who constantly deal with their inventory and it’s proper management.
Few problems which a business can face because of lack of proper inventory management:
- Items out of stock
- No track of the goods needed for production
- Miscalculation of order quantities
- Production stoppage due to non-availability of raw materials
- Warehouse Cost.
Then there is production units, list of products, warehouse, and branches and also the goods in transit, sales and purchase returns, samples received or sent and work in progress, etc. makes the work of inventory management more complicated.
Now there is a solution to all this mashup and that is accounting software which has an integrated inventory management support in it.
Accounting software with inventory management includes features like:
- Allocate batch numbers
- Maintain re-order level
- View all transactions at one place
- Instant search for a product by product name
- Get accurate inventory info by product category
- Maintains client list with their personal details
- Helps in maintaining multi-warehousing
- Provide real-time stock reporting
- No need to pass double entry
- You can check the inflow and outflow of items
- It also integrates Profit and Loss account and Balance Sheet accordingly
The type of accounting and inventory software a business uses depends upon its size and where it is located geographically, but one thing remains constant and that is for any business’s survival, accounting and inventory management is essential. It is a backbone which keeps a business standing.
- Posted on Dec 12, 2017
- By Dhruv Rudani
- 0 Comments