Cash is the life blood of an accounting firm and, like any other business, an accounting firm needs cash to pay its obligations and continue operating. The firm has to deal with accounts receivable, i.e. money owed to it by its customers. With so many clients and projects to work on, it is easy to focus on operations and chase deadlines while neglecting to invoice and collect money in a timely manner. That is why every firm needs simpler but efficient ways to manage its accounts receivables. A cloud-based accounting practice management system like Firm360 makes it easier to manage accounts receivable.
What are the disadvantages of manual accounts receivable management?
The process of manually creating and mailing out invoices, checking the accounts receivable ledger, following up on unpaid bills, and depositing checks requires a lot of work.
Basically, a staff member has to be dedicated to the work of invoicing, keeping track of the accounts receivable ledger, following up on unpaid invoices, receiving the money and depositing checks. Unfortunately, a small practice may not be able to afford an extra employee just to manage this part of the business which may result in cashflow problems.
A large firm may have an accounts clerk who manages accounts receivable. However, in a manual system some invoices can slip through the cracks. For example, if a staff member forgets to invoice a particular client, receipt of the money is then delayed and that affects the firm’s cashflow. Also, if the accounts receivable clerk forgets to follow up a particular debt, receipt of the money is delayed and that again affects the firm’s cashflow.
Customer checks takes a number of days in the post while deposited checks take a number of days to be cleared by the bank. That causes cashflow problems for accounting firms.
That is why the process of invoicing and managing accounts receivable needs to be simplified and made efficient. An accounting practice management software, such as Firm360, makes the whole process of invoicing and managing accounts receivable simpler and more efficient.
It is important for the accounting firm to simplify its invoicing and accounts receivable management system so that it frees up staff to focus on what is important which is growing the business. An accounting practice management system, like Firm360, makes invoicing simple because it can be done online.
Firm360 comes with customizable invoice templates. The accounting firm add their branding, and then create beautiful customized invoices. It is easy to share invoices with clients because the firm can email them and/or print them out and mail them. The client never misses an invoice that is in the inbox and the envelope.
The software offers automatic backup of invoices so that the firm will never worry about losing its invoices. That means customers get their invoices fast and if they misplace the invoice it can be sent again.
Depending on the level of their agreement, the firm can automatically send monthly invoice, saving time.
The software is programmed to automatically send reminders for unpaid invoices and that always motivates clients to make the payment.
What are the advantages of online invoicing?
Online invoicing eliminates time-consuming and costly paper invoices, and helps the accounting firm to be paid twice as fast as one that uses the traditional manual system. It can literally eliminate late payments.
The payment system
Firm360 makes receiving customer payments easy. It has a secure payment system which enables the accounting firm to accept payments online and literally removes the need to write and post checks.
Accepting payments online
An accounting practice management system, such as Firm360, can accept credit card payments online and the money is received instantly into the firm’s bank account. This automatically improves cashflow. For recurring clients, you can also securely save their payment methods so that future invoices are paid immediately.
Safety of customer information
The system conveniently and securely stores customers banking information. The information is encrypted to reduce the risk of identity theft.
What are the advantages of online payment?
Online payment is convenient for customers and the accounting firm. If any refunds are needed, they are quickly executed. Online payment also improves the firm’s cashflow and customer satisfaction.
Accounting firms benefit from accounting practice management software
Accounting practice management software makes invoicing, sending reminders and accepting payments easier. It frees management and staff to focus on operations and growing the practice.