CPAs are considered to be trusted advisors to a business. There are softwares available of almost every field of work. There are a number of softwares developed now days to help CPAs. Some software provides financial assistance to the CPAs while there are some that provide accounting assistance. These CPA softwares are designed to help the CPAs to provide assistance to the clients. These softwares are currently being used to serve around 5 million clients in the US alone. Most of the softwares use the extensible markup Language (XML). Softwares like BizBench2007 and TValue Version 5 provide solutions to the needs of a CPA.
The softwares help to reduce the paper work. These CPA softwares provide better communication with the clients. They save a lot of time and make the work easy for a Certified Public Accountant. They help the CPA manage their practice more effectively and efficiently. These softwares also contain a wide range of tools and plug-ins to provide additional assistance. The CPA softwares are opening up new areas and help to expand the applications of a CPA. These softwares help the CPAs clients to earn the profitability of their corporation within the exclusive financial structure of the industry, which their business is a part of.
The CPA softwares help to perform business valuations, business planning, payroll services and advanced financial statement analyses. Some of the basic uses of some of these softwares are calculating monthly payments, balloon payments, skipped payments, etc. They also help to keep accounting records for any type of the above mentioned payments. They also help to calculate and keep accounts of normal interest, fixed principle plus interest, dollar step and percent step. They also allow one to enter payments on any date. These softwares are available with various computation options Normal Amortization, Canadian Amortization, Rule of 78, US Rule i.e. Simple interest for 360, 364 or 365 days per year. Some software helps to solve problems with changing interest rates and compute Return of Investment (ROI) and present and future financial values.
The documents created in some of these softwares can be exported in to a word document (.doc) or an Adobe Acrobat read only file (.PDF). They provide with instant reports as soon as the data is entered. Printing out the report takes longer than it takes to prepare. This is the speed at which the softwares work. The software also does a lot of comparison work. They help the CPAs to compare income statements and balance sheets. They also provide instant graphs to compare any kind of financial data. There are a variety of ratios that can be calculated using these softwares like:
Liquidity ratios: Current ratio, Quick ratio and Working capital to sales percentage.
Operating ratios: Sales to fixed asset ratio, Sales to working capital ratio and Asset turnover.
Profitability ratios: Return on assets percentage, Return on equity percentage, Return on sales percentage.
Efficiency ratios: Annual inventory turnover, Operating cycle, Days in accounts receivable, Days in accounts payable, Inventory turnover, etc.
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