Importance of ERP for Accounting Records and the Accuracy of Financial Reports

Enterprise Resource Planning or ERP is a process used by companies to manage and integrate the important parts and functions of their businesses. An ERP solution is essential to companies because they help them implement resource planning through the integration of all the processes and proceedings needed to run their companies with the use of a single system.

In case of any businesses, accounting and bookkeeping would be an essential part of as long as you deal with any kind of trade or commerce. Keeping track of all transactions of monetary nature manually is rarely possible. This is where accounting system comes in. The importance of using an ERP system for accounting is laid down below:

Save Time in Daily Tasks

With the help of an efficient accounting software, every calculation can be done at higher speed and with accuracy.

Stress-Free Computerized Invoicing

ERP Accounting software can automatically generate error-free invoices with minimal inputs. It is also capable of developing detailed reports regarding customer payments, inclusive of variables like the amount to be paid and the amount they owe you. This results in essentially speeding up the process.

A higher degree of control

Using ERP for accounting gives the management more control over its business. It gives a bird’s eye view of the bottom-line impact of events and decisions in real time.

Richly detailed financial reports

ERP offers varied types of reports like cash flow statements, projections based on inventory management and order statuses, accounts receivable aging overlaid with customer order pipeline. These reports give a user more than just financial data. They help the organisation to manage its business more effectively.

Actionable and accurate Financial Reporting

Financial statements of business include significant information such as profit and loss records, balance sheet, etc. Stakeholders of an organization utilize these to analyse the financial position of the organization.

Financial management ERP software connects with every department and collects all important information into one system, which makes it easier to analyse and form a decision upon. It gives out data that are arithmetically and functionally accurate. Further, it aids the management to get a clear picture of costs and revenue at any given time.

Therefore, the right ERP accounting software provides a superior understanding of the business’ financial condition and assists in effective decision making. It also empowers the internal users of these information to make smart and informed decisions, which in turn helps the business to operate more efficiently and effectively.

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Value Added Tax in Oman

Oman will be applying five percent value-added tax (VAT) in the beginning of 2021, the country’s minister of commerce and industry said on Tuesday 21 January 2020. “VAT is something people don’t really approve of, but it is something we have been lobbying for.” said Ali bin Masoud Al-Sunaidy (Minister of Commerce and Industry in Oman) in a recent interview with Bloomberg at the 2020 World Economic Forum in Davos. In 2018, all six of the Gulf Cooperation Council states agreed to introduce a harmonised 5% VAT regime and customs union. So far, only Saudi Arabia, UAE and Bahrain have proceeded.

The Oman Tax Authorities are continuing with their preparations so as to be ready for the implementation of VAT within the limited time frame. From the experience of businesses in other GCC countries, where VAT has already been implemented, shows that preparing for the introduction of VAT requires careful and timely planning.

The minister further added that Oman was aiming at an annual economic growth of 2.5 to 3 percent and is looking to manufacturing, tourism, fisheries and logistics in as a way of diversifying its economy from the oil industry.

Under the terms specified in the Unified Agreement, VAT will apply to goods and services at the standard rate of five percent. Businesses need to start preparing early, to ensure readiness and day one compliance of VAT.

The following are the benefits of implementing VAT in Oman:

Utilisation of funds for Public Welfare

The revenue gained from the levy of VAT shall be used for various projects that would benefit the general public. Projects like providing proper health care facilities, construction of roads and related infrastructure, etc could prove beneficial.

Diversification of Economy

The economy and would be benefited by the introduction of VAT resulting in the revenue generating areas to expand. It will also help the government to minimize its fixation on the oil and gas sector. Hence, VAT will help in diversifying the economy and thereby assist in the upliftment of the economy in a gradually.

Sense of Spending

Levy of VAT would instil a sense of spending among the people as they would now utilize their purchasing power for only those goods or services that are of essential need to them.

A team of VAT experienced professionals can help you with any assistance that you may require in the process of implementation of VAT.

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Financial Advisory Services – How to Address the Economic Impacts During Coronavirus Outbreak

The Covid-19 situation is escalating causing uncertainty and disruption, across the world. The scale of the COVID-19 crisis has undoubtedly impacted all segments of the population. COVID-19 has so far affected 213 countries or territories or areas, and most parts of the world are under complete lockdown to reduce the spread of the disease. Other measures taken by the government authorities include social distancing, remote working, travel restrictions, and more.

This lockdown has caused most economic activities to come to a standstill with most industries working remotely.

  • Industrial Sectors Most Affected by COVID-19
  • Travel and Tourism
  • Automotive and Technology
  • Oil & Gas and Mining & Metals
  • Exporters

All eyes will be turned to the financial services industry to see whether they can act decisively in response to the challenges that has posed by this current healthcare emergency. Most business are facing severe financial difficulty. Therefore, it is important that the financial service organizations must be flexible, agile, to address a wide range of possible effects, providing appropriate solutions and must react to the best of the situation, thus maintaining the stage for a viable financial economic recovery.

There are many challenges that companies will face during the upcoming months

  • Maintaining cash flows to provide payment to staff and creditors
  • Ability to perform contractual obligations to customers, suppliers, financial institutions
  • Protecting staff, customers and the public from infection
  • Loss of key personnel due to illness

Amidst this crisis, most of the accounting firms across the world is providing uninterrupted support for their clients remotely. They provide different financial advisory services, and inform clients about the different options available to them. They provide proactive support to the clients, on how to best mitigate the impact of COVID-19 to their companies. The accounting firms provide help in different areas, including

  • Advise and support on working capital reviews and requirements.
  • Provides support in developing sustainable recovery plans.
  • Provides independent, contentious valuations of your business.
  • Monitor the local tax environment and its consequences on your business
  • Provide support for strategic workforce planning, including remote workforce planning, flexible contracts
  • Crisis response and business continuity planning
  • Evaluating financing options
  • Quantifying stimulus tax benefits
  • Formulating financial strategies
  • Supporting transactions
  • Reconsidering business and asset valuations

The crisis will fundamentally alter how people work and engage. For each organization, the methods that should be adopted will differ. After all, the efforts to be made must be to protect and empower your people, to serve the core needs, and to establish business continuity.

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