It’s no secret that inadequate cash management is a major contributing factor to why businesses fail. Small businesses in particular need to implement proper cash management procedures into their everyday business, including timely reconciliation of all cash accounts, and proactive accounts receivable management. Ensuring that all cash accounts are properly reconciled is of vital importance to the health of any business, but particularly the small business owner that typically does not have an endless infusion of available cash, and needs to account for every cent. Accounts receivable management is another vital piece of the cash management puzzle. Again, smaller businesses in particular may need to pay close attention to accounts receivable due dates, and implement collection processes when those balances remain on the books too long.
While larger businesses typically will not experience the cash flow issues that the small business owner may, they have a larger responsibility to their board and their shareholders to ensure that cash is handled properly and billed, collected and reconciled on a timely basis.
Identifying cash management as a vital component for the business owner or nonprofit, large or small, has created an opportunity for the accounting professional to add cash management to their menu of services they currently offer to clients. But adding cash management services has also created a need for a software application that manages, and even simplifies the cash management process for both the accounting professional and their clients alike.
In order to manage cash properly, businesses and nonprofits alike should begin with the following:
- Reconcile all bank accounts on a timely basis
- Create and follow a cash flow budget
- Track both current and projected revenues
- Manage cash disbursements and other related business expenses
- Stay on top of all accounts receivable balances and implement timely collection practices if necessary
In this issue, we take a look at the cash management functionality found in popular accounting products and cash management apps alike. You may find that you’re already utilizing the application that we have reviewed, or that you really need to look at a new application altogether. We’ve looked at numerous products and apps that offer cash management functionality. It’s up to you to determine what level of cash management capability you’re in the market for, and if a complete financial application is in order, or if an app would be a better fit. When reviewing these applications, we looked at very specific cash management features including:
- Cash forecasting capability
- Automated bank reconciliation capability
- The ability to import bank statements and transactions
- Cash management analytics
- Internal controls and security options
- Reporting capability
- Integration options
The reviews were placed into two distinct categories; Accounting Software Products and Cash Management Apps. As always, the products reviewed vary widely in functionality, with some software products suitable only for smaller businesses with less complicated needs, while others are designed to handle global industries with multiple locations.
The products included in the Cash Management review include:
- AccountantsWorld Accounting Power
- QuickBooks Online
- Sage 50cloud
- Sage Intacct
- Thomson Reuters Accounting CS
We also took a look at several apps that are designed to be used in conjunction with cash management applications.
Cash Management Apps:
The need for adequate cash management will not disappear in the future. As more business owners and nonprofits turn to their accountant to provide these services, accounting professionals may find themselves searching for an application that works well with their current software applications, or perhaps look to replace their current application with one that may be better suited for their circumstances.
Large or small, for profit or nonprofit, cash management is an important process for every successful business. These products and applications make cash management just a little bit easier.
See inside February 2018
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