Advantages of having an accounting integrated with the ERP system
Integrated accounting helps the company to have greater control and accuracy in its accounting information, and thus make better decisions.
Stay with us and we’ll explain how this can help your company be more efficient.
What is accounting integrated with the ERP system?
Integrated accounting is one in which the company's accounting is processed internally, based on the actual information generated by the management system (ERP).
In general, integrated accounting is performed within the ERP system by professionals trained in the accounting area.
There are situations in which the company does this through contracted accountants, who work full time in the company.
In other situations the company does integrated accounting and has the support of an external accountant to validate and sign the balance sheets.
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In this type of accounting, all sectors, branches and divisions of the company are integrated into the central management system (ERP).
Tax, strategic and cost issues are linked, allowing a more precise and transparent business management.
What are the advantages of accounting integrated with the ERP system?
In this model, the company is able to collect information in real time, both of production costs and of goods purchased for resale.
This allows management to make more efficient decisions.
Another important point is the fact that the company is obliged to be updated with the current tax rules specific to its sector.
Consequently, this constant update will avoid problems with the tax authorities.
In addition, the company's management has access to strategic data in general, which are converted into vital information.
Integrated accounting makes the company organize and this ends up being reflected in the performance as a whole.
We must also not forget that integrated accounting allows the company greater control over the payment deadlines for taxes and other tax obligations.
Internal accounting integrated into the system is also essential for the implementation of another branch, managerial accounting.
What is needed to implement integrated accounting?
First, no matter how obvious, there must be a strong commitment from the company's management in this regard.
The implementation of this accounting method in the company requires effort, discipline and generates initial expenses that will require everyone.
From inventory and sales personnel, to administrative and production departments, if applicable.
Everyone must be committed so that the information is generated correctly.
Accounting is an activity based primarily on numbers.
Therefore, it is necessary for everyone to use the management system properly so that the generation and processing of these numbers is accurate.
In terms of investments, the company will need to contract the accounting module of its system, which will involve the monthly fee and probably the disbursement with an implementation fee.
There will also be investment in personnel, with the hiring of accountants or technicians who will do the accounting itself.
Consequently, there will be an investment in physical structure for these personnel, such as preparation of rooms, furniture, equipment, etc.
Does this accounting format work for all companies?
No, small businesses or start-ups may not be able to implement integrated accounting.
This is because expenses may not be viable due to the size and volume of information generated.
However, companies already established, with consistent growth and depending on the degree of complexity of the sector in which they operate, should already think about this idea.
Medium-sized companies, whose annual revenue is greater than R $ 16 million per year, already have a complexity in the operation that fully justifies such accounting.
In the end there is always an analysis of the entrepreneur, weighing the pros and cons.
Do you want to take a step forward in managing your company?
AAA CAS specializes in Customized ERP Software's in Dubai for retail and agribusiness companies.
Our accounting module helps our clients to have the best business performance.
Talk to us without obligation by firstname.lastname@example.org or by phone 97142287774.