7 Cost drivers in accounting and administration

According to studies, the majority of activities in the administration of SMEs are either unnecessary or too expensive. Thanks to the lean management movement and the lean administration and lean accounting method derived from it, also small and medium-sized companies begin to question and streamline such corporate processes. This is important, because the continuous improvement is essential for the long-term success of the companies.

Today, startups and SMEs have a range of tools available to simplify their administration and accounting processes.

By using a software solution for the complete process of offer, quotation, invoice, GL to balance sheet and profit and loss account redundant data is eliminated and the processing time significantly reduced.

Standards such as CAMT.53/.54 and MT940 in banking or Zapier in webapps simplify and standardize business processes and reduce unnecessary manual work steps.

The cloud not only brings new accounting programs to the SME world, but also enables teams to work more efficiently, to use intelligent filing systems, and more.

The right use of workflow, automation and cloud enables SMEs to benefit from digitalization in finance, even without an investment budget. We are happy to inform you about our recommended configurations for startups and SMEs.

7 Cost drivers in accounting and administration

If you want to review your processes, the following cost drivers will guide you to determine how you can optimize your system:

Cost driver 1: Autonomous accounting program. If you run different software systems for quotes, invoices, and bookkeeping, the potential for improvement is huge.

Cost driver 2: Redundant data acquisition. For example, do you enter vendors in the accounting program and also manually enter the payment in e-banking? A sign of unnecessary work steps.

Cost driver 3: Manual booking of bank transactions. Meanwhile, even small businesses can benefit from automatic bank balancing. If you still book manually, you should consider this optimization.

Cost driver 4: Local software installation. The unnecessary exchange of data with the trustee is eliminated if modern cloud accounting software is used. If this also allows the deposit of vouchers to the bookings, the time required for the accounting control and the annual accounts is significantly reduced.

Cost driver 5: Preparation of interim financial statements by the trustee. Many small business owners are required to contact their trustee for a meaningful reporting. With the right software at hand, you can automatically process accounts receivable and payable at no additional cost and evaluate your key figures on a daily basis in the dashboard.

Cost driver 6: Unnecessary document storage. We encounter so many things: Filing of customer invoices in two different folders. Filing of bill attachments such as payment slips. Storage of bank documents. Etc. If  you know the legislation and practice interpretations of tax administrations and social insurance companies you can throw off and archive a lot of paper and make room for your business.

Cost driver 7: Time-consuming approval processes. In the past, perhaps it was a pragmatic approach to put the bills on the desk for work colleagues or supervisors. Today with an increasingly mobile working environment and our daily work routine, which consists of a multitude of small distractions and interruptions, we want to have the data (invoices) available when and where we need them. This does not require expensive document management software, but rather a smart, mature filing system in the cloud. We’re happy to help you implement an approval process that will greatly simplify your admin and accounting process.

If SMEs address these cost drivers by leveraging available optimization solutions, they reduce administration and accounting costs heavily.

Our goal is that entrepreneurs follow their passion and focus on what they do best: to create value for the customer. That’s why we not only share our know-how in comprehensive lean administration projects, but also in pragmatic workshops for small businesses so that they can work independently in a do-it-yourself mode.

Contact us now for an informal get-together.

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