Excel and Bookkeeping

Microsoft Excel is a popular alternative and basic tool for bookkeeping in Brisbane. Most, if not all small businesses start their bookkeeping and accounting using the platform. Excel is equipped with features, options and capabilities that support records management, computations and reporting. It is effective, efficient and easy to use. Many enterprises who started with Excel do not see any reason to change the process or use an accounting software.

But, despite its many advantages and benefits, Excel is not the perfect bookkeeping tool. It is not specifically designed for accounting or bookkeeping, thus the limitations.

Disadvantages of Using Excel for Bookkeeping

  1. Excel is not free

Excel is an application included in Microsoft Office suite that includes Word, PowerPoint, outlook, and OneNote. Subscription to the Microsoft can range from $60 to $150 yearly for one user. The cost will increase as you need more user licenses. The cost is attributed to the entire Microsoft suite of applications, thus you might be paying for things that you don’t really need and will never use.

  1. Use of advanced programming

Excel possibilities are endless if you know how to use it. Excel comes to you clean. No pre-installed bookkeeping or accounting programs or functions. If you want it to work efficiently, you will have to create the formulas, design the pages or tabs and program the application according to your needs. You might need an Excel programmer or someone who has an extensive Excel, Visual Basic and Algebraic capabilities.

  1. Time-consuming

Using Excel for bookkeeping will entail a huge manual work for your Brisbane bookkeeper. He or she will have to manually create the books, encode data, and design formula and formatting. This might work well with smaller enterprises with manageable transactions. But for larger companies and for those that

  1. Does not work with other business apps

One of the biggest challenges of using Excel for accounting or bookkeeping is Brisbane is its inability to integrate or work with other business applications. Sales, deliveries, inventories and disbursements all have to be manually entered. Whereas, when using a bookkeeping or accounting software, all these are automatically fed and integrated into the software.

  1. Few audit controls

Excel do not track changes, when the change was made or who made the change. Excel data can be view and edit protected. This is fine when working alone or with one other person or bookkeeper. But when you need to collaborate work with more people, you will need a more sophisticated application that features the required business audit controls.

  1. Manual work is prone to errors

Excel do not have double-entry checks. Users can easily mistype an amount or miss a transaction. Excel formulas, when not properly encoded, can give you erroneous reports. And these errors can easily go unchecked and unnoticed until a proper audit is done.

Many businesses also used Excel as their first step to computerisation. You can expect all Brisbane bookkeeper or accountant to be Excel cognizant, but not necessarily experts. While the application works well in keeping things organised and recorded, it is also time-consuming and restrictive. It does not have the productive and efficient accounting and bookkeeping functions of an accounting software like apps integration, reports generation, tax help, audit controls and accounts tracking. Excel is perfect as a starting bookkeeping app or an easy day-to-day tracking tool. But it will be wise to use a dedicated and specifically designed software for your accounting and bookkeeping.