Accounting software

Accounting software can be characterized as a subclass of computer software, that can record and then process various accounting transactions. In lay terms, it is an application that helps specialists to perform different accounting operations. This software is quite popular and commonly used by large enterprises, small companies and even home users, as these applications help to automate some operations, save time and reduce labor payment expenditures.

Accounting software may be developed by the company and used in-house or purchased from third-party developers. Some companies may purchase the application and then add some local modifications or changes to the program.

Accounting software can be divided into four main types. The software of each type is specially designed to satisfy the requirements of different end-users. Therefore the features (and the price, of course) of different accounting software vary a lot. Below main applications types are listed.

Personal accounting software is developed for home users and first-time entrepreneurs. It is used to manage budget. Such programs have reduced set of functions, applications design is straightforward and fairly well understood. Personal accounting software is comparatively inexpensive.

Low-end market program is designed to satisfy the needs of a small companies; it allows to perform general accounting functions. Such applications do not have audit trails, so they are not widely used. Low-end market accounting software is inexpensive.

Mid-market software has enhanced functionality. It allows accounting specialists not only manage the budget, by also to perform audit trail and manage accounting databases. This software type may be used even by international companies, as it allows accounting in several different currencies. Beside of that, mid-market applications may be configured or even extended to fit main business requirements.

High-end market program is really complex. It has many functions and features that may be customized to support specific business processes of the company. Often such applications are developed by company's request. It is quite expensive. Combined with specific programs, high-end market accounting software is may be used as ERP (Enterprise Resources Planning) application.

There are also some hybrid software solutions that combine the functions of two or more above described accounting software types. For example, growing company can purchase the software, which combines the functions of mid-market and high-end market programs.