As a school owner it is essential that you know exactly how your business is performing on a month by month business. Rather than ignoring this valuable information the successful school owner would know exactly how much income had been generated last month, how this income had been generated, how much expenses were paid and exactly how much should be provided for certain events.
Without recording your transactions on a regular basis it is impossible to know the above details with any certainty, and even harder to identify whether you are meeting or exceeding budgets.
Reports can be easily generated from accounting systems, providing you with information such as profit and loss accounts, various breakdowns of expenses, budget reports, and graphs detailing year to date performance.
In this article I am going to look at several different methods of keeping your bookkeeping records and provide honest feedback from an accountants point of view so that you can make an informed choice for your business.
To grade the different packages I am going to use the following criteria:
Cost there is no point purchasing enterprise-level software with a correspondingly high price tag for a small school! Ease of use again, there is no reason for purchasing software that is so complicated that it doesnt get used!
Reporting the standard of reporting provided from the system is vital for allowing you to monitor the progress of your business.
Manual Cashbook
Ratings: Cost: 4/5 (Approximately 10 20) Ease of use: 4/5
Reporting: 0/5
The manual cashbook has probably been used by all of you at some point the big red (or green) book provided by an accountant so that you can handwrite all of your payments and receipts at the end of the year.
Advantages: Low cost, relatively easy to use
Disadvantages: No reporting,each column has to be totaled manually
Excel Spreadsheets
Ratings: Cost: 5/5 (Free of charge)
Ease of use: 3/5
Reporting: 1/5
Excel spreadsheets are essentially a computerized version of the manual cashbook, available free of charge (provided that you have spreadsheet software).
Advantages: Excel analysis and summary tools, free of charge
Disadvantages: Reporting in Excel is complex, potential formula issues
Online Accounting
Ratings: Cost 5/5 (Free of charge)
Ease of use 4/5
Reporting 3/5
A secure online accounting tool provided by your accountant will provide you with the ease of use of a manual bookkeeping (with no manual totaling!) and basic reports found in comprehensive packages such as Profit and Loss, category breakdowns, graphs etc.
Advantages: Reporting, ease of use, free of charge, no software installation
Disadvantages: Ideally requires broadband connection
Quickbooks
Ratings: Cost 2/5 (Approximately 100 upwards)
Ease of use 3/5
Reporting 4/5
Quickbooks is a comprehensive package targeted at small business owners to assist them with the management of their financial affairs, offering various reports and functions.
Advantages: Detailed reporting, ease of use compared to Sage
Disadvantages:Cost, training requirements, ongoing updates
Sage Accounting
Ratings: Cost 2/5 (Approximately 129 upwards)
Ease of use 2/5
Reporting 5/5
Sage is an established accounting software providing comprehensive reporting and more functions than you will ever need, albeit with a steep learning curve.
Advantages:Detailed reporting, potential departmental / budget analysis
Disadvantages:Cost, learning curve, ongoing updates
If you feel that your system is not currently providing you with the reports that you feel would assist you in your business it would be worthwhile discussing this with your accountant to decide whether a change would be beneficial. For example, our firm provide online accountancy packages and tailor made Excel spreadsheets. We are also Sage Accountants Club members, and as such can advise all of our clients how to select and implement a package to suit their needs.
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