Top 10 Financial Errors: #3 Using Accounting Software Without Financial Modeling and Reporting.

Robert Orben once said: “Every day I get up and look through the Forbes list of the richest people in America. If I’m not there, I go to work.”

Unfortunately most of us (the 99%?) have to work for a living.  It is even better if the time we spend making our living can be as productive as it can be.

When it comes to financial decisions, it’s a given that you need good data to make good decisions. There are many good general and legal accounting packages out there. But recognize that accounting packages exist primarily for accountants. As lawyers and business owners, we need software that will give us insights into how we are doing as business owners and those responsible for running our practices. So look for accounting packages that build in as many management and modeling reports as possible to give you great data upon which to make your financial decisions.

Look closely at the software you now use. Unfortunately, most of the legal accounting packages out there put the powerful financial analysis tools into the “Pro” versions, which are suitable for larger firms.

Solos and smaller firms face a Hobson’s choice: Acquire the basic level of the software and forego the higher-end financial tools, or pay thousands of dollars for a full version that you will never use.  Fortunately this is starting to change for the better!

Although moving to a different accounting package may be a troublesome undertaking, remaining with one that doesn’t effectively help you run your business by giving you good financial data upon which to make decisions in a timely manner will be more expensive and troublesome in the longer run.