Choosing the right financial services tools
Financial management is the differentiating factor between a successful business and a struggling one. There are several cloud-based tools used in finance systems. The selection of strong business tools depends on several considerations listed below:
Balancing the budget:
gaining better financial planning, control, and visibility is among the main reasons for adopting financial tools. The finance tools must make financial budgeting easy and efficient. The tool must be able to create budgets for any scale of operations.
Ensuring the safety of business:
as financial transactions move away from paper to online platforms, the security, and safety of financial data increases. The financial tool must manage access to sensitive financial information efficiently. The finance management tool must provide granular roles for access control.
a financial management tool must evolve with the growing needs of the business so that costs of converting into a new system as per new business requirements can be avoided.
Switch to the cloud:
the choice of using on-premises or cloud-based finance management software is made depending on business requirements. Some businesses opt for a cloud-based approach for real-time updates and anytime/anywhere availability of records and workflows, while others opt for on-premises financial management systems to have full control over the processes. The software must be flexible to support both types of installations.
Automation and efficiency:
cloud-based financial management software saves businesses time and costs. Choosing automation software like Cflow from Cavintek modernizes the finance process and boosts the efficiency of approval hierarchies.
Ease of use:
the financial management software must be easy to install and use. Software that demands intensive training is not preferred as it would eat up the productive work hours of the finance team.
The decision on the financial management tool needs to be made based on considering all of the above points and business requirements. Business finances can be complex and intimidating, but the right financial management tools can simplify and streamline financial management.
Examples of Financial Management Tools
Several finance tools examples are available for various finance processes. The list of financial management tools given below is essential to running your business, spanning from account management to budgeting to expense management.
Financial planning: financial planning involves developing strategic plans, identifying the financial resources, obtaining and developing resources to achieve business goals. Generating relevant and realistic budgets is a function of financial planning tools.
Cash flow management: the cash flow statement is a very important financial statement. Managing cash flow ensures that the business has enough cash to pay current bills. A cash flow management tool automates the generation of cash flow statements.
Budgeting and managing a budget: a well-planned budget presents what a business expects to spend and earn over a specific time period. Creating operating budgets, project budgets, and cash budgets can be done easily and accurately using budgeting software.
Expense management: Monitoring employee expenses on the go is part of the accounting software. Expense management software speeds up reimbursement claim validation, processing, approval, and payment. Using expense management software ensures that businesses don’t spend more than they need to.
Payroll management: payroll management requires accuracy and consistency, even the slightest error may prove costly for the business. Payroll management tools must be able to grow as the business evolves and integrate with existing accounting software.
Inventory tracking: tracking inventory from multiple locations requires powerful tools that help save time and money. Automated inventory management provides real-time inventory visibility and the ability to track inventory from purchase order to sale.
Tax preparation: a business tax software imports data from POS systems, downloads data from inventory systems, and provides complete data to accountants for the purpose of tax preparation. Financial information systems for small businesses must integrate with other business systems for getting a complete picture.
Personal Finance Management Tools
Account spending tools for personal finance management are used by individuals to track and manage their expenses and savings and make informed investment decisions. Creating monthly budgets and expense trackers helps individuals track their progress on monthly goals for money management and savings. Here are some examples of financial management tools for personal money management.
tools like My Spending Report and Budget Watch (from Wells Fargo) help in tracking each transaction made by an individual. Transactions like credit and debit card purchases, bill payments, etc. are tracked in real-time by these tools. The tool sorts the gathered data into familiar categories so that the person gets a complete financial overview of the expenses.
the data gathered on personal spending history is used to create a monthly budget. Once a budget is created, all financial transactions and progress are tracked and updated at the end of each day. The budgeting tool provides an overview of what’s left and which transactions have exceeded the budgeted amount.
Smart saving tools:
the savings tools are used for creating personal savings goals on a monthly, quarterly, and annual basis. These tools are equipped with visual tools like customizable alerts and interactive charts that inform individuals of their progress.
retirement planning can be greatly simplified by using appropriate finance tools. These tools help you set realistic savings goals that are customized to your expense and saving capacity. Based on the expense and income data, these tools provide a realistic plan for pursuing the goal.