Finance for Craft Spirits | Accounting GL Software & Operational Accounting

The PDF is a slide deck on the topic of accounting GL software and operational accounting in your finance department for a Craft Spirits company.

TCA - Craft Spirits Finance - GL Software and Operational Accounting
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Here is text only outline of the slide deck.


Process and Tools

  • The topics of General Ledger (GL) software and operational accounting are part of a larger discussion about your organization’s accounting process and tools.

Topics

  • General Ledger (GL) Software

  • Paying Vendors

  • Other Expense Management

  • Invoicing Customers

  • Inventory Tracking (including POS for DTC)

** Not covering payroll processing but will in future presentation related to compliance issues.


Accounting (GL) Software

  • Small Business Systems

  • Relatively low cost and low IT requirements

  • Easier to use for accountants with less experience

  • Don’t handle inventory accounting well, natively

  • Examples (QuickBooks, Xero)

  • ERP systems

  • Used for operations as well as accounting, creating an easier data flow

  • Can automate bringing together data from multiple systems and locations into a central hub

  • Reduces accounting hours through automation

  • More customizable reporting

  • Significant cost increase over small business grade accounting software

  • May have more IT requirements

  • Usually requires specialized consulting for implementation, maintenance and report writing

Paying Vendors

  • Bill payment platforms

  • Allow for more automated digital approval process including multiple layers of approval

  • Integrate the payment processing with recording the transaction in the accounting software

  • Provide a quick digital record with invoice/receipt images that are often quicker and easier to use then accounting software.

  • Examples: Bill.com, Melio, Ramp

  • Bank payment platforms

  • May provide the same level of online execution including sending checks

  • May also integrate with accounting software

  • May have limited access options and approval capabilities

Other Expense Management

  • Expense Management

  • Software including phone Apps

  • Deployed across employees that will have expense reimbursements or company charge cards

  • Streamlines record collection, categorization, explaining, approvals, processing reimbursements

  • Integrates with accounting systems

  • Examples: expensify, tally, concur, many others…

Invoicing Customers

  • Invoices are usually prepared with your accounting system to streamline preparing the invoice for a customer and recording the sale and receivable in the accounting system.

  • All conventional small business accounting software has this functionality including customizations.

Inventory Tracking

  • Raw materials and work in process is usually a shared responsibility with Production team

  • Finished goods in the wholesale distribution channel is often a shared responsibility with Sales team

  • Finished goods in the DTC channel is a shared responsibility with tasting room and e-commerce teams

  • Raw Material, Packaging and Work in Process

  • Production team has “custody.”

  • Accounting needs reports from Production on what is incoming, what is in various stages of process and what is outgoing. This information is used in Cost Accounting.

  • Best practice is for Production Teams to use software for their operational tracking that also handles TTB compliance and can provide the information needed to Accounting.

  • Even with production software, unless using an ERP, getting production data into the Cost Accounting is one of the more manually intensive tasks of the Accounting function.

  • Finished Goods for Wholesale

  • In the custody of warehouse operators.

  • Accounting needs reporting on incoming, quantities on hand and outgoing.

  • This data may be useful in verifying sales numbers as well as keeping a record of inventory on hand.

  • Finished Goods for Tasting Rooms and E-comm

  • And while we’re at it, let’s talk about payment processing

  • In Tasting Room and E-comm teams’ custody

  • Accounting needs reporting of incoming, on hand and outgoing inventory as well as reporting of the sales and payments processed.

  • Conventionally this done with a Point-of-Sale system (POS). Some can integrate with accounting systems, but all should have necessary reporting.

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