7 min read

11 Accounting Software Features All Companies Need In 2024

QUICK SUMMARY

When you're in the market for accounting software, you want to know you're getting the most bang for your buck. This is what you should be looking for.

TABLE OF CONTENTS Why the right features matter How business size factors in 11 key features 5 helpful secondary features

Most accounting software offers similar features, but your company needs more than the basics to achieve its financial goals. In this article, I'm sharing the top 11 must-have accounting software features to help you stay organized, save time, and make faster and better financial decisions.

Why The Right Features Matter

I've seen small and large companies alike struggle with sunk costs while considering replacing their current systems, even though the systems they had were no longer meeting their accounting and financial reporting needs—sometimes finding themselves here less than a year after going live.

Even with cloud-based accounting software solutions, selecting the right software to grow with your company can save money, time, and resources. Consider these costs, not to mention the frustration of selecting features.

Licensing
Customization
Implementation and data migration
Onboarding
Maintenance
Training

Depending on the size of your business, these are some of the must-have features for start-up bookkeeping, accounting tasks in small businesses, or Enterprise Resource Planning (ERP) in larger organizations.

In addition to general modules like general ledgers (GL), Accounts Receivable (AR), and Accounts Payable (AP) automation, here are some of the features I find most vendors highlighting about their software:

Features	Start-ups (depending on complexity)	SMBs(depending on complexity)	Large Organizations
Forecasting	✅	✅	✅
Expense tracking	✅	✅	✅
Time Tracking	✅	✅	✅
Budgeting	✅	✅	✅
Reporting	✅	✅
Contact Management	✅	✅	✅
Billing/invoicing	✅	✅	✅
Document management	✅	✅	✅
Payroll		✅	✅
Inventory tracking		✅	✅
Supplier management		✅	✅
Asset tracking		✅	✅
Multi-user access		✅	✅
API			✅
CRM integration			✅

Author's Tip

It’s important to factor in your business’s industry, level of sophistication, and compliance, and compare the different types of accounting software. Some may not meet all of your company’s financial needs.

How Business Size Factors In

When evaluating accounting software features, the size of your business and its complexity play essential roles.

For example, most small, private businesses have simple structures, products, or services and only need a bit more than the standard features, which many free software options contain.

A mid-sized or larger business will have significantly more complexities—and specific compliance requirements—which requires more robust and advanced features.

11 Key Features Of Accounting Software

Selecting the right features is about more than just the core features that most vendors list. Here are the top 11 must-have features that you should be looking for in your accounting software.

1. User-Friendly Interface

This feature is an absolute must-have. I know it seems like a nice bonus, but I promise you: It’s a core feature. I've frequently heard users complain about accounting software with all the right bells and whistles, due to a crappy interface.

Make sure the systems chosen to complete your end-to-end accounting cycle have an intuitive and easy-to-navigate user interface, so that users can focus on their value-added business activities instead of struggling with complicated accounting applications.

2. Automated Bank Transaction Feeds

Manually entering bank transactions is time-consuming and prone to human errors. Bank statement activity automation allows you to connect your business bank accounts and import your transactions automatically, saving you time, reducing errors, and ensuring that your financial records are up-to-date in real time.

Also, look for automated bank reconciliations for additional time savings.

3. Cash Flow Forecasting

Understanding your cash flow is crucial for managing your business finances effectively. Choosing the best accounting software with automated cash flow forecasting features helps you predict your company's future cash position based on historical data and upcoming transactions.

This facilitates more informed decision-making, proactively avoids cash flow issues, and improves your company's financial health.

4. Budgeting and Forecasting

Creating and managing budgets is a vital part of financial planning. Accounting software with budgeting and forecasting features built right in allow you to set your business’s financial goals, track your progress, and adjust as needed. It gives you a clear picture of your expected income and expenditures, helping you make faster and better financial decisions.

5. Expense Approval Workflow

An expense approval workflow can improve efficiency, help ensure compliance, and control business expenses for multiple employees or departments.

Accounting software with this feature helps you establish approval hierarchies and automate the approval process, reducing the risk of unauthorized costs squeaking through.

6. Mobile Access

In an increasingly remote environment, almost everybody is on the go these days—having access to financial information on the go is essential.

Mobile apps allow you to manage your company’s accounting from anywhere and collaborate in real time, whether you're traveling, meeting with clients, or just can’t stand that one guy in the office and want to work from home.

7. Customizable Reporting

Standard balance sheets, income statements, or other financial statements are essential, but at some point, someone will ask you to provide a more innovative or advanced report with more in-depth information you've not previously asked for. I know this all too well.

Accounting software with customizable reporting features allows you to create tailored reports like performance indicators or one-off analysis reports, giving you and your team the flexibility to gain deeper insights.

8. Document Management

Accounting software with document management features allows you to upload, store, organize, and share your financial documents in one central location.

Even though most people have a common digital drive anyway, having this feature baked into your accounting software makes it easy to control user access and retrieve specific documentation when needed.

9. Integration with Third-Party Applications

Integrating with other business applications, such as CRM tools, can streamline workflows and eliminate manual effort and duplicate data entry.

This integration ensures that your financial data is always in sync and up to date with other systems, saving you time and reducing errors.

10. Tax Management

Tax rulings and regulations are constantly changing, making business tax complicated at the best of times.

Accounting software should have built-in tax management features that help you with tax calculations, reporting, and tracking your tax liabilities. Tax features should also provide the necessary tools to generate tax reports and facilitate compliance with tax regulations.

In other words… it should make your life a lot easier.

11. Audit Trail

From time to time, you may have to identify when and who accessed particular records—and you'll want to be prepared. I've asked and answered this question while working in accounting and information systems.

Having an audit trail is essential for transparency and accountability, allowing you to track access, transaction creation, modifications, or deletions. This feature is particularly important for businesses that need to maintain a clear audit trail for compliance or reporting purposes.

Author's Tip

Plan out the features you’d estimate you realistically need within the next 5 years—if it’s further out than that, don’t consider it. This way, you’re anticipating upcoming needs without over-customizing.

5 Helpful Secondary Accounting Software Features

While the top 11 must-have accounting software features are essential for streamlining your business finances, these helpful secondary features can further enhance your financial management processes.

1. Automated Recurring Transactions

If your business has regular recurring transactions, such as monthly subscriptions or rental payments, automating them can save you time while keeping everything up to date.

Accounting software can automatically generate and record these transactions, reducing manual data entry the whole way through.

2. Payment Gateway Integration

Accounting software integration with payment gateways can streamline your payment process if you receive online payments. It allows you to automatically import payment information, reconcile payments with invoices, and avoid manual data entry.

3. Automatic Payment Reminders

Late payments can impact your cash flow. With automatic payment reminders, accounting software can help you stay on top of your receivables by sending gentle reminders to your customers.

This feature can improve your collection process, thereby reducing the risk of overdue payments and the risk of you sending a slightly-too-spicy email.

4. Project Accounting

Project accounting features are essential for many medium to large project-based businesses that want to become more agile and innovate faster.

Project-based accounting assists companies in setting and tracking clear goals, tasks, milestones, and deliverables for each project separately. It also enables you to evaluate your projects' financial performance and make adjustments to ensure profitability.

5. Cloud-Based Storage

There's no shortage of stories about on-premises data losses. Cloud-based solutions provide many benefits, like enabling companies and accountants to access financial data securely from anywhere and in real time with minimal risk of losing data due to hardware failure or natural disasters.

Cloud providers take backup storage seriously, offering layers of redundancy protection against these and other events.

Investing in the right accounting software features that best fit your current and 5-year business needs can save hours of frustration and help you have better control over financial decisions.

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