How Cloud-Based Accounting Helps You Build Budgets
There are a lot of reasons why many small businesses don’t create budgets. Some feel they’re too small to warrant one. Others don’t think they can realistically predict what their income and spending will look like over a period of several months.
But there are other business managers and owners who eschew budgets because they’ve only ever tried to create and track one on paper.
That trick never works.
Online accounting applications are good at a lot of things that make them such capable budget managers.
- They make it easy to create—and equally important—edit—large tables of data.
If you’ve been developing budgets on paper or in Excel, you already know their limitations. You either have to have a really big piece of paper or multiple pages, which makes it difficult to scan the whole thing at once. If you’re not handy with sizing and resizing Excel blocks, you’ll be frustrated before you even start to enter labels and numbers. Editing your budget(s) can be problematic, too.
Some online accounting applications will create a framework based on your chart of accounts that you can then edit, copy, and save. And they let you drop in actual historical data from a specified number of months to help you get started.
- They minimize duplicate data entry, partly due to copy-and-paste and replicating capabilities.
Excel can copy data from cell to cell, too, which is great when you’re creating a budget. If you’re attempting this task manually, though, you’ll be doing a lot of repetitive entry.
- They can perform complex calculations instantly.
There’s a lot of tallying required as you fill in your budget. And if you have a lengthy paper document, you’ll spend a lot of time with a calculator. Even then, errors are certainly possible.
Cloud-based accounting applications can do more than just instantly post totals at content breaks and at the bottom of each column. Say you want to increase or decrease your cell values at certain times of the year by either percentages or amounts. You can automate those changes using state-of-the-art accounting websites.
- They are capable of working with imported and comparative data.
If you’re already using Excel, you’ll find that cloud-based accounting applications cooperate well with it. You should be able to import an existing budget from your spreadsheet.
The most useful attribute of an accounting website is its ability to compare your budget numbers with actual data. You can customize and create such reports with a few mouse clicks.
Considering that you may not have wanted to do a budget in the first place, every impediment to success increases your chances of throwing up your hands and giving it up. So besides saving an enormous amount of time and reducing frustration, accounting websites make it far more likely that you’ll succeed at this critical task, and benefit from the instant analysis of your budget.