We are all used to having our mobile software and applications updated every second day. Just a click and your mobile updates itself with new software improvements. In the same manner, companies using financial systems also need to have a regular system review or evaluation to ensure that the system works smoothly. Every software that we use may have some glitches, bugs, or even a new improvement and needs a regular update.
Every company has some kind of system in place for recording business operations and transactions and hire financial professionals to take care of their finance functions. Having an inadequate financial system always pushes the company a step back with very little value addition. A good financial system offers plenty of benefits including processing transactions quickly, transparency, coordination with other business operations, reduces manual processes and provides scope for business improvements.
But how does one conclude that the financial system needs an upgrade? Every financial system shows certain signs that need to be carefully evaluated based on the company’s needs. In case any gaps are assessed between the company’s goals and its financial system, then necessary changes have to be made.
Some signs that indicate a need to upgrade your financial system are:
If the current system of the company is too slow to process any functions, it will take a lot of time to fetch any form of data or information. This is very critical when there are impromptu meetings of top officials who need a lot of financial information in a very short time. If the software is not updated accurate information will never be provided which will hamper the decision-making process and in turn, cost a lot to the company and its business operations.
Introducing new products/processes:
When companies add new product lines or new processes, it is imperative that they check their finance system for an upgrade. More products and processes indicate business growth and managing finances becomes even more important. It is necessary for the business to know exactly where the funds are coming from and where they are being utilized. All this can be done easily if fully functional and updated software is in place. Along with fund management, the updated system can also help in assessing the company’s products/ services. It evaluates various associated costs, projects future costs, and helps to manage and mitigate risks.
Manual Process and monthly/ annual activities are time-consuming:
At times many companies track their transactions using spreadsheets and not through their system. Doing so increases both the workload and the chances of making errors. An updated financial system ensures automation as well as the accuracy of data. Even the month-end activities take a lot of time because of audit queries and account reconciliation if transactions are not recorded in the system. The use of upgraded software ensures that all documents are uploaded and that solves most of the queries and many reports and reconciliation are readily available which saves the company’s time and resources allowing plenty of time for improvements and other important projects.
Accounting system crashes regularly:
Most of the time companies install a financial system but do not upgrade it further in order to save money as they feel that the system is working just fine, but in reality, it misses on the latest developments and also poses a threat to data security and privacy. Systems that are not regularly upgraded tend to crash more often and cause loss of data, waste time as you need to rework, and also cause a delay in the performance of regular activities.
Regular shortage of inventories:
A software upgrade is required when a company faces a shortage of inventory and has to arrange for materials at the last moment. A good financial system helps you to manage your inventories effectively and enables companies to place orders just in time as required.
Spending a lot of time in recording payroll transactions:
Companies hire employees and it is very important to take care of various employee-related payments including salary and wages, provident fund, income tax, allowances, deductions, superannuation, etc. A system that does not help in the calculation of all these payments automatically based on employee’s data will increase the time to process payments. Since payroll is a recurring activity, it is important to have an upgraded system that tracks the information of the employees and enables direct payment into their bank account on time.
An upgraded system ensures that information and data related to the company’s business are secured and protected. Systems are vulnerable to hacking and a leak of any company information can cause serious damage both to the company’s business and its reputation. A system that is unable to provide data security is nothing less than keeping the door open and expecting the thief to not steal a thing.
Customers/ Suppliers requests cannot be met by the current system:
Good accounting software has all the details of customers and suppliers and their payment terms. This information not only helps to ensure that payments are received on time; but also ensures that suppliers are paid their dues. It is important to be in constant touch with customers and suppliers and if the current system is unable to do it then an upgrade is immediately required.
Competitors are making changes in their financial system:
It is very easy these days to know exactly which software is used by the competitor. If the company’s financial system is nowhere close to what the competitor is using then it simply means that the company is giving up on its business just because it doesn’t want to invest in good software. Upgraded systems ensure that companies are in sync with the latest developments. And they can use it to their benefit and leverage it to earn more revenue and profits.
Users of Financial systems are reporting issues:
If the present users of the financial system like employees, customers, suppliers, government officials, etc. report any issues with the current financial system, then the company must look into the issues and solve the same by opting for an upgrade. The users of the system not only input data but also receive a lot of necessary information from the company’s system and if the current system does not provide the same it can cause the users to be frustrated which is never good news to the company.
If you are looking for someone who can help you with a financial system upgrade then Diligen is one such financial service provider who can cater to your needs. We have experts in the field of both finance and information technology who can easily understand the client’s current system and also suggest and guide the clients during the installation and implementation process of the upgrade. Diligen provides hands-on training to our clients and ensures that the installation and transition of the new software or an upgrade happen very smoothly. We understand our client’s business and their system needs and assure the best quality services with optimum output.