Although
accountability and financial management are important for businesses in every
sector, these issues are critical for municipalities. With a commitment to the
public, municipalities must ensure that they’re financial actions are in the
public’s best interest. To ensure that
your municipality is as accurate and transparent as possible when it comes to
financial management, you should choose some accounting software. Before you
can make a selection, you need to consider the differences between the two
different types of accounting software.
What Is
Commercial Accounting Software?
Commercial
accounting software is designed to measure a company’s product and performance
in terms of gain and loss of profit. Although small businesses have to follow
certain tax regulations, in the end, their profits are their business. Most of
the reporting done by small businesses is only for investors. It makes sense,
then, for such businesses to use accounting software that’s going to inform
them about how profitable their business is from day to day.
What Is
Fund Accounting Software?
Fund accounting software, on the other hand, does
not emphasize profitability. Instead, fund accounting software is more in tune
with accountability and is used by most non-profit organizations and government
organizations. Fund accounting software allows municipalities to keep a good
record of how their money was spent rather than focusing on how it was earned,
like most small businesses do. When financial reporting is done by non-profit
organizations, it’s usually in order to comply with laws, so multiple audiences
see these reports.
Making
Your Choice
As you can see, commercial accounting and fund
accounting software programs are focused on two very different things. As a
municipality, you should think about what your focus is and realize that the
point of all the financial transactions your municipality conducts is not to
gain profit. As your municipality is more interested in accountability, it will
be your responsibility to choose software that’s going to give you a fair,
accurate picture of your organizations expenses. Fund accounting software is
specifically designed to provide such a portrait, and it’s a smart choice for
municipalities everywhere.
If you’re looking for easy-to-use fund accounting software for local governments, USTI is here to help. We offer financial management solutions that will allow you to keep track of your municipality’s finances in an orderly and accurate manner. Our accounting software is either located on your local desktop or cloud-based, so it can be accessed anytime or anywhere, making it easy to stay on top of your financial situation at all times.
