DO YOU REALLY NEED AN ACCOUNTANT IF YOU USE ACCOUNTING SOFTWARE?

There’s absolutely no doubt that digital accounting software has unlocked incredible advantages for anyone managing business finances. 

Cloud-based platforms make accounting more efficient than ever, providing real-time data and powerful insights that help you spot growth opportunities, and simplifying tasks that used to take hours.

So it’s no surprise then that when small business owners learn about its awesome benefits, they ask themselves, ‘can accounting software replace an accountant?’.

As a modern accountancy firm that embraces technology and by offering both human and software based accounting solutions, our unbiased answer to this question is - no, as the software and an accountant do very different jobs. The software simply helps an accountant do their job.

HUMAN ACCOUNTING VS ACCOUNTING SOFTWARE:  QUICK BREAKDOWN

Accounting software can handle the basics – recording transactions, raising invoices, tracking expenses, reconciling accounts and producing financial reports.

But software doesn’t replace financial expertise – it can process information, but it can’t necessarily tell you what the numbers mean or what you should do next.

• An accountant can help you stay compliant – from tax returns and VAT to payroll, accounts and other reporting requirements.
  

• They can also help you make better business decisions – by analysing your figures, identifying trends and helping you understand your profitability and cash flow.
  

• Tax is another big reason to get professional advice – an accountant can help you understand which expenses, allowances and tax-saving opportunities may apply to your business.
  

• The bigger or more complicated your business becomes, the more valuable an accountant can be – particularly if you have employees, multiple income streams, international activity or plans for growth.

WHERE AN ACCOUNTANT ADDS VALUE

Accounting software is very good at processing and organising financial information, but interpreting that information can be more complicated. An accountant can help turn the figures into a clearer picture of how the business is performing and what they could mean for its future.

Compliance

Compliance is a key area where professional support can be useful. HMRC rules and Companies House requirements can change, and understanding how they apply to a particular business isn't always straightforward. 

This can be especially relevant for businesses with more complex circumstances, such as e-commerce businesses, medical practices or growing limited companies. An accountant can also help ensure that statutory accounts and other required filings are prepared accurately and submitted on time.

Financial guidance

Accounting software can show you what has happened financially, but it doesn't necessarily explain why it happened or what you should do about it. An accountant can analyse the information in your accounts to identify trends, assess profit margins, examine cash flow and highlight areas where costs could potentially be managed more effectively.

This can make financial information more useful, as professional advice can provide context that software alone cannot.

The right support for your business

The level of accounting support a business needs will depend on its circumstances. 

A sole trader with straightforward finances may be able to manage much of their bookkeeping and record-keeping using accounting software. A growing limited company with employees, VAT obligations or more complex finances may need more support.

An accountant can provide anything from occasional advice or a review of your accounts to a more comprehensive service covering bookkeeping, tax returns, annual accounts and ongoing financial advice.

HUMAN ACCOUNTANT + SOFTWARE = THE BEST OF BOTH WORLDS!

You don't necessarily need a full-service accountant. Depending on your business, you might simply need someone to check your accounts, deal with your tax affairs or provide advice when you need it.

The best option is a combination of both, use accounting software to keep your finances organised day to day, and an accountant to provide the expertise, oversight and advice that software can't.

At Sadler Advisory we use the latest accountancy software tools, like Xero, Link My Books and Apron, to help us find every last hidden tax saving! 

We've seen first hand how these systems can streamline operations for limited companies, start-ups, property businesses, and freelancers alike. Combined with our expert human accountants, they enable us to offer mega, profit-boosting value to our clients.

Visit our software page to see all the software solutions we work with.

FINDING THE RIGHT SOLUTION FOR YOU 

The important takeaway is that using accounting software doesn't have to mean choosing between software and an accountant. 

For many businesses, the two work alongside each other: software handles much of the routine processing and record-keeping, while an accountant provides the expertise and judgement needed to interpret the numbers and deal with more complex financial matters.

The question is less “Do I need an accountant?” and more “What financial tasks can I confidently handle myself, and where would professional advice add value?”

At the end of the day, every business is different, and requires its own unique accounting solution. This is what we’ve learned after over two decades of helping UK businesses improve their finances. Whatever kind of business you run, and how much you love or hate tech, we can help you do the same.

Get in touch to find out how.