Zoho Books – Your ultimate accounting software

Zoho Books is a cloud-based accounting software that uses accrual and cash-basis accounting to make business finances easy to manage. This article’s scope is valid for any cloud finance application for Small and Medium enterprises. The below tips will help you keep financial discipline and ensure maximum value from the finance system that you are using.

1. Always Create Sales Orders:

A sales order is a document generated by the seller confirming the quantity and the amount of the product or services to be given or rendered. It usually consists of a price, quantity, rate, terms, and due dates. We see that some of our clients avoid creating a sales order and do direct invoicing which is not recommended. Following are some of the tips for sales order:

  1. Sales orders can directly be converted into sales invoices when they have been approved.
  2. Sales order is a good way to keep track of your invoices. It ensures that all the relevant invoices have been issued.
  3. Sales order helps keep track of inventory levels by identifying re-order levels and safety stocks.

2. Always Create Purchase Order:

A purchase order is the first official document issued by a buyer to a seller indicating the type, quantity, agreed price, or any other requirement that needs to be fulfilled. Following are some of the tips for purchase order:

  1. It helps you to avoid duplicate orders.
  2. It enables you to keep track of product prices and avoid surprise prices increases.
  3. It communicates all the details of the purchase.
  4. It can help you identify performance problems.

3. Bank Reconciliation:

Bank reconciliation is not mandatory, however; the best practice is that it should be exercised every month.

  1. Bank reconciliation ensures the existence of transactions (i.e. are amounts appearing on the bank or credit card statement are showing up in the accounting system and vice versa).
  2. It Ensures accuracy of transactions (i.e. are amounts recorded correctly)
  3. It is a good way to catch any errors, frauds, or omissions (i.e. bounced payments, banking errors, miscellaneous fees)
  4. It helps to manage cashflows for the company.
  5. Bank reconciliation is not mandatory however, the best practice is that it should be exercised every month.

4. Track Inventory:

Contrary to popular belief, Zoho Inventory and Zoho Books are two separate modules and can be purchased separately from one another.

  1. Inventory management helps track what’s in stock and what’s on backorder, so you don’t oversell products
  2. Contrary to popular belief, Zoho Inventory and Zoho Books are two separate modules and can be purchased separately from one another.
  3. Multiple e-commerce websites can be integrated using Zoho inventory.
  4. It is also best suited for keeping track of the inflow and outflow of inventory in multiple warehouses.
  5. Zoho inventory can also be used for shipment tracking by linking it with your shipping service. It also enables you to get real-time shipping rates and notifications when the delivery has been made successfully.

5. Zoho Subscription:

Most of the users send recurring invoices while there is a separate module in Zoho for subscriptions i.e Zoho Subscription.

  1. Zoho subscription allows you to pause and resume your subscription as per your requirements.
  2. It also provides the facility for online and offline payments for your websites through Share Hosted Payments.
  3. It enables you to handle customer billing and to send them professional tax-compliant invoices on a weekly, monthly and yearly basis as per their product plan selected.

6. Zoho Expense:

In order to deal with complicated or multiple expenses, it’s advisable to use Zoho Expense.

  1. Zoho Books can be used to record expenses but Zoho expense is specifically useful in recording travel-related expenses.
  2. You can add snapshots of hard copies of expenses and upload them on Zoho Expense which enables Zoho expense to categorize them accordingly and record them as an expense.
  3. It also enables you to handle, track, and approve advance payments as well as reimbursement payments.