The importance of accounting integration in timesheets

Timesheet Feature Review #4: “Accounting Integration”

Many companies use timesheet software for one simple reason – to track time spent by their staff. However, time tracking alone is not enough. While it’s all well and good to simply measure the amount of time spent by your employees on a particular assignment, you also need to be able to use the data for something.

One of the most common uses for timesheet data is for accounting – companies often use timesheets either to bill time to their clients or to help in the payroll process, ensuring that their employees are paid accordingly for their time. Most companies already have some form of accounting system in place; many would be uncomfortable with revamping their accounts process just to accommodate a timesheet system. It is therefore vital that timesheet products are able to provide users with the ability to regularly and easily port the data collected by the software over to their pre-existing accounting systems.

How can I use timesheet data in my accounting system?

Timesheet software collects data on the amount of time spent by your staff on a project/task. Obviously, you wouldn’t be logging time just for the sake of it – you want to be able to do something with the information collected. There are several ways that timesheet information can be used by a company but one of the main ways is to help with accounts and reports.

For example, companies that bill their time to clients such as legal firms or consultancies need to be able to generate accurate bills based on the hours worked by their staff. Some timesheet software have inbuilt accounting features that can help you create basic reports and bills but as most companies would already have an accounting system in place, this is far from ideal. Many companies would therefore prefer an option to transfer the information collected by the timesheet software over to their pre-existing accounting software so that everything is streamlined and their employees are also spared the trouble of dealing with two separate accounting processes.

Another way that companies can use timesheet data is in the payroll process. As employees are usually paid by the hour, some companies use timesheets to track employee work time to help cut down on costs and to monitor work efficiency. For these companies, being able to use the information collected by the timesheet software in their accounts system is crucial in ensuring that their employees are paid fairly for their time worked.

What are the advantages of integrating timesheets into my accounting system?

Many companies use popular accounting software like QuickBooks and MYOB to help log and audit their finances. Being able to integrate your timesheet product with these software would provide a hassle-free way to transfer data in between both systems. This way, your employees will not have to trouble themselves with manually entering the information logged by the timesheet into the accounts system.

Integration also makes the whole process much more efficient and less prone to human error as everything is done automatically and you don’t have to worry about keying in wrong information. Accounting integration thus also reduces your employees’ workload which allows them to focus on their actual work instead of being bogged down by needless admin processes.

What are some of the limitations of accounting integration?

The main drawback to accounting integration is simply that not every accounts package/system can be supported by your timesheet product. Timesheet developers can only provide integration with a limited number of accounting systems so they target “popular” systems such as QuickBooks, MYOB, Saasu and Xero. However, with this approach, there are still many companies that are left in the cold because they use a less popular accounting package.

Also, the popularity of accounting systems varies from region to region, so what is popular in the United States may not be as widely-used in Australia. As most timesheet developers mainly focus on catering to US-based companies, popular accounting systems used in other countries are unlikely to receive integration support from the timesheet vendors. Fortunately, there are a host of integration specialists (e.g. WDCI) that can provide custom connections between timesheets and accounting systems.

The other limitation to accounting integration is that it requires several other features to be in place in order to work well. For example, accounting integration would not work quite as smoothly for companies that bill their time to clients without a “billable/non-billable” distinction. Without clearly distinguishing billable from non-billable time, automatically porting data over to the accounting system could cause confusion and major client issues. Also, if a problem arises within the timesheet system, it is possible for the accounting system to be affected as well due to integration.

In conclusion

In the recent review by Software Shortlist of the top must-have timesheet features, accounting integration was listed as the #4 most wanted. It is easy to see why many companies would want to be able to combine the utility of a timesheet with the familiarity and administrative power of a pre-existing accounting system. However, with the limited number of accounting systems supported by most timesheet products, some companies may be disappointed with the lack of support for their particular system (especially if they are outside the US).

Of the 21 timesheet products reviewed by the Software Shortlist, 16 provided integration with accounting systems like QuickBooks, MYOB or Saasu. I hope that this article has provided you with an idea of what you can accomplish with accounting integration and also the possible drawbacks of adopting such a system.

Have Your Say

As usual, we’d love to hear from you regarding accounting integration. Why not leave us a comment about whether you prefer your timesheets to be integrated with your accounting systems or not, and why? Perhaps you could share your experience  with an actual integration of two specifics systems?

Also, stay tuned for more reviews as we count down on the top “must have” timesheet software features.

Information vs attention

Quote of the day:

“What information consumes is rather obvious: it consumes the attention of its recipents. Hence, a wealth of information creates a poverty of attention, and a need to allocate that attention efficiently among the overabundance of information sources that might consume it.”
-Herbert Simon

If you’re looking for software, the above observation probably rings true for you.

In fact, this is why we set up Software Shortlist — to help you cut through the wealth of available information so you can quickly and reliably get the specific facts and insights you need for your decision.

How to get free information on software selection

Software Shortlist was founded with the mission of helping businesses succeed by choosing the right software. And to date, our website and services have helped over 28,000 firms in their software selection process.

To ensure we are well placed to assist the next 28,000 (or 280,000!), we recently made some important  changes to our business model to give you free access to our unique and valuable information on software selection.

Why are we doing this?

Well, our original plan for Software Shortlist was to deliver independent information to small & mid-sized businesses (SMBs) looking for software, and to get paid by them directly for this service. So, we invested in creating unique, high quality resources such as our patent-pending online comparisons & independent review packs.

However, it became clear that many of you simply don’t have a budget for this sort of input in your software selection process. But you still want and need assistance…

Did you say free access  to software selection resources?

Yes, we have made a small but important change to our business model:  you can now get access to our high quality resources and information for free!

That’s right – you no longer have to pay $99 or more for our software review packs. Nor do you have to pay for our online comparisons. In fact, all of our valuable content is now free if you’re looking for software.

What do you mean “free”?

True, nothing worth having is ever truly free. There is a significant cost to creating the valuable content and services on this website. Someone has to pay for that.

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Connecting you for relevant conversations

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Any comments?

We hope you understand the changes outlined above, and we look forward to helping you with you software selection needs for many, many years. If you have any questions or comments, we’d love to hear them.

Thanks!

The Software Shortlist Team