5 Strategies to Use Excel for Small Business enterprise Accounting

Accountants are recognised for putting on pocket protectors and investing their days doing the job in Microsoft Excel. I can vouch for the latter stereotype.

a person sitting at a desk in front of a laptop computer: Businesswoman analyzing spreadsheets on computer

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Businesswoman analyzing spreadsheets on personal computer

Quite a few tiny businesses swear by Excel for all of their bookkeeping requires. Even though accounting application has its put in every business enterprise, you can reward from introducing Excel into your life.

3 benefits of using Excel for accounting

Excel is a strong resource that can assistance anyone doing the job with quantities.

1. Streamlined knowledge entry

I’m not taking something absent from the ease of use that is turn into standard in small small business accounting software program, but you’d be tricky-pressed to find a method superior suited to mass data entry than Excel.

Excel electrical power consumers know that macros can churn out hours of a human’s operate in times. Organization entrepreneurs can generate macros to automate jobs, this sort of as formatting, filtering, and jogging essential assessment.

You really do not need to have to know how to set up macros to gain from Excel’s functionality. As we’ll discover down below, Excel remains just one of the most effective methods to import big transaction datasets into your accounting software.

2. Visual economical examination

Financial analysis doesn’t have to be a list of accounting ratios that evaluate your company’s profitability. If you’re a visual learner, use Excel to develop pie charts that present the place your business’s income is heading.

Nonprofit annual stories often use visible aids to communicate where by they spend their dollars. For-revenue providers may get ready related reports when pitching buyers.

3. Uncomplicated sharing

Excel is the universal forex of accounting. When you need to share monetary details with a loan provider or investor, you’ll want to send them both a PDF or Excel file.

3 most helpful features for Excel small enterprise accounting

I could go on for eons about the Excel functions that little corporations can leverage for accounting. Listed here are my a few favorites.

1. Templates

Microsoft has thousands of absolutely free Excel templates on its website. Alternatively than obtaining to structure your have invoices and expenditure reviews from scratch, you can obtain and tweak someone else’s development.

Templates are handy for individuals who aren’t cozy navigating Excel or have not but aced Accounting 101. Designing your personal accounting templates involves 100{f13b67734a7459ff15bce07f17c500e58f5449212eae0f7769c5b6fbcf4cc0c4} precision if one particular cell is not doing the job effectively, you could wind up with mistakes in your accounting records. Templates are plug-and-perform with pre-crammed formulas.

2. Formulation

Excel formulas drastically speed up small business expenditure tracking and analysis.

Say you’re looking at the bank statement beneath and want to know how much the small business spent on stock buys. Rather than including up a record of the relevant fees employing a calculator, you can use the “SUMIF” formulation, instructing it only to add fees marked as inventory buys.

table: An Excel spreadsheet shows a SUMIF formula.

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An Excel spreadsheet displays a SUMIF method.

You can uncover the substantial library of Excel functions by clicking on the formula button at the major of any Excel webpage. It will bring up a side panel where you can look for and understand how to use the perform.

graphical user interface, table: A Microsoft Excel window with the formula button boxed in red.

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A Microsoft Excel window with the system button boxed in red.

3. PivotTables

I have saved the most effective for past. PivotTables, the most strong Excel feature, reorganizes data to present it far more logically. Accountants use the software to process bank statements and other economic information.

For case in point, financial institution statements normally record transactions chronologically, which does not assist you recognize wherever your dollars went that thirty day period.

I built a PivotTable down below to categorize income and expenses on the adjacent lender statement. It collapsed the buy and stock transactions into one line to delineate how a great deal the business gained in earnings and used on inventory buys. The whole row reflects the company’s internet money for the month.

graphical user interface, application, table, Excel: A PivotTable lists the categories in a bank statement.

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A PivotTable lists the types in a bank assertion.

The instance demonstrates just a month’s worthy of of transactions, but visualize your spreadsheet lists of transactions for an full 12 months. You could use a PivotTable to individual your transactions by thirty day period to improved realize your company’s income circulation. That would take several hours by hand, but it is only times with PivotTables.

How to use Excel for your modest business accounting requirements

Excel can help you with numerous factors of your smaller small business accounting. Here’s how I’ve applied Excel as an accountant.


Despite the fact that a lot of accounting software program platforms have budgeting options, I’d pick Excel every time.

Start your enterprise spending budget by exporting an earnings statement from your accounting software to Excel. Distinct out the numbers and increase columns for every month of the interval for which you’re budgeting. Then begin entering your budgeted numbers and voila! You have a spending plan.

As your business’s funds get much more involved, you can develop granular sub-budgets that roll up into your business’s master budget. Excel can take care of it.


If your accounting computer software doesn’t have an invoicing aspect, you can easily generate specialist expenses by means of Excel.

Microsoft Phrase also has invoice templates, but I wouldn’t endorse working with them for the reason that Word templates can’t do any arithmetic for you. Excel bill templates routinely sum bill line items, lessening the threat of human error. You would not want to be dependable for underbilling a shopper because of an arithmetic miscalculation.

Cost experiences

Just about every time you reimburse an staff for mileage or another small business cost, you ought to inquire for receipts and an expenditure report that tallies all expenses in a person document. There are hundreds of price report templates to pick from online.

Accounts receivable and accounts payable

Numerous little companies monitor who owes them and whom they owe with an Excel spreadsheet.

Firms on the cash accounting technique only history earnings and charges when money arrives in or out. Excel is the fantastic repository for a list of superb customer invoices and your business’s unpaid bills because they have no put in your accounting records right up until funds adjustments palms.

Accrual-foundation organizations report receivables and payables in their accounting application when they make profits and incur fees, respectively. They should not need to have to track their receivables and payables wherever else.

Bank reconciliations

Bank reconciliations, one particular of the bookkeeping basic principles, compare your company’s accounting documents with its lender statements. You can place each aspect by side in Excel and speedily scrutinize any discrepancies.

Quite a few accounting computer software options have financial institution reconciliation equipment, but I like to use Excel to perform month-to-month reconciliations simply because of its no-frills interface. Get started the financial institution reconciliation by downloading Excel variations of your company’s typical ledger and bank assertion. Then, duplicate and paste the information into a single spreadsheet and get started reconciling.

3 best tactics when making use of Excel accounting software package

Keep away from generating more do the job for by yourself by adhering to these finest methods.

1. Allow formulation do the work

The very best guidance I’ve gained about employing Excel for accounting is to stay away from “hardcoding” figures when probable.

Think about you are developing your company’s spending plan for next year. You program to pay out all workforce the condition bare minimum wage of $12 for every hour. You later on learn that the minimal wage is going up to $15 upcoming yr. If you created the finances applying formulation the first time, this take care of should consider no extra than 30 seconds.

Hardcoding a variety suggests getting into an precise number, not a system, into a mobile. The only numbers I hardcoded down below are the $12 bare minimum wage and the monthly hrs for every employee. Formulation determine the employees’ regular monthly gross fork out.

graphical user interface, application, table, Excel: A payroll budget shows an employee’s monthly hours multiplied by the minimum wage.

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A payroll spending plan demonstrates an employee’s every month hours multiplied by the bare minimum wage.

Bridget’s regular pay back is calculated by multiplying her regular hrs by the point out minimum wage. Experienced I individually multiplied 12 and 30 in every single mobile, I would have to redo the entire payroll finances. Many thanks to the system, I can simply just transform the 12 to a 15, and all the every month payroll quantities will immediately update.

A reward tip: The dollar symptoms in the formula “lock” the row and column you are referencing, so if you duplicate and paste the formula from 1 cell to an additional, it will go on to reference the very same place instead of adjusting for the new cell’s spot.

2. Help save Excel accounting documents securely

Anywhere you retail outlet economical information and facts must be secured by a password that only a privileged several know. Password-guard Excel files with delicate information and facts, these types of as employee Social Safety figures.

Really do not ignore to again up information that are not saved in a cloud storage process.

3. Create template data files

Help save your bill and expenditure report templates as template files. When you open up a template file, it creates a new document that will not overwrite the primary template.

Following you obtain and tweak your expense report template, click on “Save As Template” and help you save it to an accessible location for you and your personnel. Any time somebody clicks on the template file, you can be certain they will not inadvertently destroy all your difficult work in creating it.

Excel with Excel

Excel can be daunting at first, but the feeling fades speedily. It is like meeting your in-guidelines for the 1st time (ideally).

Get started exploring Excel’s abilities by downloading an cost report or invoice template and tweaking it to healthy your business enterprise. Soon more than enough, you’ll obtain the know-how to carry out it much more commonly in your organization.

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