The Annual Audit: How POS Can Make It Less Painful

Bematech Blog - December 6, 2016

Annual audit time depicted by calculator, clock and moneyWith so much to think about when it comes to running your business, accounting isn’t always front of mind — until the time for the annual audit. The audit doesn’t have to be a hassle, however, with help from the correct Point of Sale (POS) system, integration with accounting software will be seamless.

Integrated, Not Interfaced

Accounting software may interface with a POS system, but it’s important to distinguish between interfaced and integrated solutions:

  • Interfaced systems permit interaction between two solutions, enabling them to share information.
  • Integrated systems work as if the two solutions are one solution — all of their components work with each other. Integrated solutions use the same data files, and information that flows from one system to another is updated in real time.

How Integrating POS and Accounting Benefits Your Business

There are three reasons why integrating the POS system and the accounting system makes it easier for retailers to face the annual audit as well as have the data they need for business decisions all year long:

  1. Time savings across the board. Accounting tasks can create two to three weeks worth of full-time work each year, according to the National Small Business Association. An integrated POS and accounting solution allows you to complete this work with enhanced efficiency by easily tracking and generating reports through the sharing of vendor and customer information, sales tax collection, general ledger account balances, and other data between the two systems. The end result: significant time savings, not only during preparation for the annual audit, but every day.
  2. Ability to avoid double entry of data and maintain data accuracy. Integrated software modules use the same data files, so it is unnecessary for the same data to be entered more than once. Data flows seamlessly from module to module, keeping it consistent across all modules and promoting overall accuracy.
  3. Ability to view information in real time. Manual transfer of data from one system to another takes time, opens doors for inaccuracies, and makes annual audit preparation more complicated than necessary. It also makes it impossible for business owners to access data in real time. The less real-time data merchants can access, the lower their chance of a truly accurate annual audit and, also, the lower their chances of having all the information they need to make the smartest business decisions throughout the year.

A system in which your POS solution automatically separates different types of information — for instance, tax from the cost of goods sold — and automatically populates information directly into your accounting software is a wise option. A top-notch system is also customizable by state, so that retailers can maintain accurate records for stores with different tax rates. Additionally, the right retail POS system will make annual audit procedures go more smoothly by pulling all asset, liability, revenue, and expense information as well as populating the right fields when tax season rolls around.

Merchants can’t afford to leave the accuracy or efficiency of conducting an annual audit to chance — or to waste time with unnecessary tasks such as duplicate data entry. Leverage integrated systems to pave the way for a smooth accounting at audit time and all year long.