Integrating online billing software with an in-house accounting software improves the accounting experience because it takes a complicated, tedious process and automates several actions. Whether it is through direct action of the online billing software or triggering an action within the accounting software, integration between the two software systems simplifies the full lifecycle of accounting for your business.
Assuming your business uses double-entry bookkeeping, online billing software integration with your current accounting software ensures the automatic entry of a debit to accounts receivable and credit to the revenue account when you create a new invoice. When you receive payments online, the integration takes care of sending information to the accounting software to debit the cash account and credit accounts receivable. Using online billing software with integration automatically updates the general ledger.
As previously mentioned, the creation of an invoice in an integrated, online billing software automatically creates an entry in the accounts receivable account and an accurate balance of the total accounts receivable amount.
An automated accounting system allows for quick availability of inventory because the data is transferred automatically and often in real-time. When the billing system notifies the accounting software of the recent charges and can transfer the data of what individual items are invoiced, it is then easy to know how inventory is affected by recent sales.
Past Due Accounts
Many billing software solutions have functionality that automatically sends payment reminder emails when invoices are past due. The benefit to accounting is that the first steps of a collections process are automated.
Invoices that have been subject to a collection process are eligible for being debited to the bad debt account. Rules can be created that automatically transfer amounts in accounts receivable to a bad debt account.
As a result of the online billing software or the result of integrating accounting software with online billing software, the entire accounting process can become easier.
Keep up to date with the EBPP industry and SmartPay by liking our Facebook page.