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How To Automate Your Accounting In 6 Steps For A Canadian Business

Updated: Jan 22

Though the days of pen and paper are behind us in much of the accounting world, a rigid Excel model is no longer the gold standard, either. Both Excel models and paper use brick-and-mortar accounting processes that require business owners to waste valuable time manually entering data, reconciling bank statements, paying suppliers individually, chasing down clients for key documents. The list goes on. And on. It doesn’t have to be this way.

Today, accounting software helps you and your business automate most, if not all, of the laborious tasks you used to perform weekly for bookkeeping. Not only does online accounting save you time, but it also improves both your margins and your sleep. If you’re unfamiliar with losing sleep, you obviously haven’t experienced audit season before. There are many other side benefits, too, not the least of which is the ability to confidently make business decisions with real-time numbers and access information from anywhere in the world. All of these benefits will not only lead to fewer headaches, but also a better customer experience.

Here’s your helpful guide to automate accounting tasks in six easy steps:

Step 1: Know what you’ve got

It can be very hard to learn how to automate accounting tasks when you don’t have a comprehensive list of the platform(s) you currently use. Chances are, as an entrepreneur, your accounting services aren’t too scattered, but things can still get out of hand if somebody isn’t constantly monitoring the system. Again, and we can’t emphasize this enough, Excel IS NOT the answer.

Let me repeat myself – and not just because we at ReInvestWealth have free accounting software we want you to utilize to make your life less complicated – Excel is a slow, manual and overall outdated form of bookkeeping. Older versions of the platform make collaborating almost impossible, and financial analysis and reporting teams end up spending more time reconciling raw data than analyzing key insights. Depending on the particular needs of your business, some accounting software may be better than others.

Step 2: Identify core software(s) you’d like to use

Once you have a good idea of the individual accounting needs of your Canadian small business (and remember: think to the future, not the present – it’s always better to adopt bookkeeping procedures that your company can grow into), do some digging to find a platform that best suits your needs. If you’d like to explore your options with ReInvestWealth, don’t hesitate to book a free consultation with one of our accountants or try our free accounting software.

Step 3: Link relevant bank account(s)

Once you’ve selected the right cloud accounting app, you’ll need to link all the relevant bank accounts your company currently has open to your new accounting software. At ReInvestWealth, our software can connect with any Canadian financial institution. Your online accounting software will become populated with a list of the transactions your company makes. And voila, any company credit card linked to the account will have transactions automatically posted on your virtual ledger!

Step 4: Review transactions on the general ledger

At first, it may be a little challenging to review past transactions on the general ledger. However, with some accounting software (including ours at ReInvestWealth), you can apply labels that associate transactions with specific accounts, and can even enter the relevant taxes that must be considered alongside each transaction.

The real beauty – the automation – takes place in the next step.

Step 5: Write formulas that automatically categorize payments on the general ledger

This is the most important step for those wondering how to automate accounting software using the service provider you’ve selected (smart small business owners choose ReInvestWealth, just saying). Any business owner curious about how to automate accounting workflows, bookkeeping, invoicing, tracking revenues, tracking expenses, or making online payments, listen up!

Most accounting software contains some form of automation, whether it be in pre-designed visual workflows or simple formulas, to pre-emptively filter future payments to the proper account. If I tend to get my supplies from Staples, I could create a filter that would place any transaction with the word “STAPLES” denominated in CAD into an account titled “Supplies”, and apply the specific sales tax rate of the province where my business is located. A simple algorithm like this can save days of sorting through past transactions each year!

Step 6: Sit back and monitor

Go home early! No more worrying about tax compliance around audit season or chasing down paperwork and employees for time sheets. As payment data only gets more powerful, and AI algorithms become more widespread in accounting software tools, your role will only get easier. Someday – but we doubt it – you might even miss it!

British actor Bradley Walsh once said, “The times change, and if you don't change with them, you get left behind.” Times are changing before our eyes in the accounting software world, which is expected to reach a global market value of $70 Billion USD by 2030 up from $20 Billion USD in 2020. Canadian cloud accounting companies such as ReInvestWealth have incorporated technology infrastructure and data security protocols to support high volumes of entries for all types of businesses.

Canadian small businesses that don’t move their bookkeeping to AI-powered accounting software will be putting themselves at a major disadvantage. Make an appointment today with an accountant from ReInvestWealth to help you make the switch to cloud accounting.

Written by: Shaan Hooey


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