Get Your Cash Flowing

By using accounting apps and software, you can better automate collections and rein in accounts receivable.

May/June 2016

Everyone wants to get paid on time. Fortunately, businesses have a plethora of software options they can use to stay on top of the money that should be coming in.

“There are literally thousands of account software programs on the market,” says Adam Bluemner, managing editor with Find Accounting Software. This almost-overwhelming multitude exists, he says, because of the widely varied demands of different organizations. A retailer has accounting needs different from a nonprofit, for instance. The right cash management technology will depend on your business needs.

Basic accounting software can record income and accounts receivable, Bluemner says, and might be used to write and record checks for accounts payable. Customized programs, however, can be packaged with additional financial management features. More companies are also looking to simplify accounts receivable by introducing electronic funds transfer (EFT), he says, as an option their customers can use. That can be an efficient way to decrease the time it takes for payments to come in.

The goal, Bluemner says, is to free up business owners to focus on other tasks. If a business’ clientele falls behind on their bills, software and apps are available to send out automatic reminders, collect payments electronically, and charge late fees to lapsed accounts.

PayPal is an option for collecting fees immediately from customers via their credit cards or bank accounts; and Venmo is an app that consumers can use to send payments from their bank accounts to anyone. Even Amazon has developed a software platform, called Amazon Payments, that merchants can use to collect payments from customer credit cards—but what happens if an account becomes delinquent?

When you need detailed and comprehensive cash management...

Features that Bluemner says business might look for in accounting software include alerts that are sent to customers when they cross the late-payment due date (along with a calculation of additional fees that have been assessed). That can include an automated e-mail dunning letter, which goes out to clients when an account is overdue.

Intuit's QuickBooks is the most recognizable program that fits this bill, but you may want to explore small business and freelancer-oriented tools that can help with invoicing and accounts receivable duties. Sage 50; Xero, which is a software-as-a-service option; Microsoft; and SAP offer robust cash management tools, Bluemner says.

Eileen O’Loughlin, market research associate with Software Advice, concurs that Xero is a popular alternative to QuickBooks. In very small businesses, she says, FreshBooks is an option for those who need to manage invoicing and expense management but can do without an extensive core set of accounting features.

When you need to get paid faster…

If your challenge is not so much managing your cash, but actually getting that cash in the door, here are a few other apps and software that can be used for invoicing and collection:

KashFlow—includes automated invoicing and can import data from other software such as QuickBooks and Sage, as well as from spreadsheets. The software will also alert the user when an invoice is overdue for payment, in addition to showing them immediately upon sign-in how much money they are owed by their customers. KashFlow includes three prewritten reminder letters that can be sent to overdue accounts.

BillQuick—has some features tailored for such users as architects, attorneys and IT professionals but can be used with other types of businesses as well. BillQuick can also integrate with QuickBooks and Sage and has some 180 templates for invoices that can be customized. It has automatic billing, as well as check-writing and purchase order management.

Fusebill—subscription and recurring billing software that can accept payments from PayPal, checks, credit cards and other electronic means. Billing automation also sorts out taxes, which can vary by location and need to be calculated accordingly.

ChargeOver—web-based billing and subscription software that can integrate with Xero, QuickBooks and other apps. Its automated collection system sends out missed-payment reminders and notices of failed charges, and will issue an alert when further action is needed on a past-due account.

Chargify—works with a variety of payment gateways, including Stripe, Authorize.net, Braintree, Chase Paymentech and TrustCommerce. As a service for recurring and subscription billing, the software can be integrated to keep track of whenever customers use a consumable resource, such as phone minutes. The system can be set up to automatically retry attaining payment for overdue accounts, and automatically cancel subscriptions if they do not comply.

Regardless of which software—custom or vanilla—used to handle accounts and billing, businesses should remember to coordinate with their accountants to ensure that any data transfers and reviews are simple and time efficient. “The important thing to note is that there is not a ‘one size fits all’ solution,” O’Loughlin says.


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