5 Means to Use Excel for Compact Business enterprise Accounting

Accountants are known for donning pocket protectors and expending their times functioning 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 examining spreadsheets on laptop or computer

Many little businesses swear by Excel for all of their bookkeeping demands. Although accounting software program has its position in each individual small business, you can benefit from introducing Excel into your daily life.

3 advantages of making use of Excel for accounting

Excel is a impressive software that can assist anyone doing the job with figures.

1. Streamlined facts entry

I’m not using everything absent from the simplicity of use that’s grow to be common in smaller company accounting application, but you’d be tough-pressed to uncover a program much better suited to mass knowledge entry than Excel.

Excel electric power people know that macros can churn out several hours of a human’s get the job done in times. Company homeowners can make macros to automate responsibilities, this kind of as formatting, filtering, and managing standard investigation.

You do not need to have to know how to set up macros to benefit from Excel’s operation. As we’ll check out beneath, Excel continues to be just one of the very best approaches to import huge transaction datasets into your accounting application.

2. Visible financial examination

Financial assessment doesn’t have to be a listing of accounting ratios that assess your company’s profitability. If you are a visual learner, use Excel to make pie charts that clearly show where by your business’s revenue is likely.

Nonprofit once-a-year reviews normally use visual aids to communicate where by they spend their funds. For-income corporations may possibly put together similar experiences when pitching traders.

3. Simple sharing

Excel is the common forex of accounting. When you will need to share fiscal facts with a loan provider or investor, you will want to mail them both a PDF or Excel file.

3 most helpful functions for Excel small small business accounting

I could go on for eons about the Excel capabilities that tiny firms can leverage for accounting. Here are my three favorites.

1. Templates

Microsoft has hundreds of cost-free Excel templates on its web page. Fairly than possessing to design and style your individual invoices and expense experiences from scratch, you can obtain and tweak someone else’s development.

Templates are useful for people who are not comfortable navigating Excel or have not yet aced Accounting 101. Planning your have accounting templates calls for 100% precision if 1 mobile is not operating effectively, you may wind up with mistakes in your accounting documents. Templates are plug-and-participate in with pre-crammed formulas.

2. Formulation

Excel formulas substantially pace up small business price monitoring and evaluation.

Say you are on the lookout at the financial institution statement down below and want to know how considerably the small business expended on inventory buys. Instead than introducing up a record of the applicable costs making use of a calculator, you can use the “SUMIF” method, instructing it only to incorporate fees marked as inventory buys.

table: An Excel spreadsheet shows a SUMIF formula.

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An Excel spreadsheet exhibits a SUMIF formula.

You can find the sizeable library of Excel capabilities by clicking on the system button at the best of any Excel page. It will convey up a aspect panel where you can research and discover 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’ve saved the very best for final. PivotTables, the most potent Excel feature, reorganizes info to present it extra logically. Accountants use the device to approach lender statements and other economical details.

For instance, financial institution statements usually list transactions chronologically, which doesn’t assist you have an understanding of wherever your revenue went that month.

I manufactured a PivotTable below to categorize profits and costs on the adjacent bank assertion. It collapsed the buy and inventory transactions into a single line to delineate how much the company earned in earnings and used on inventory buys. The full row displays the company’s web earnings for the thirty day period.

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 lender assertion.

The instance reveals just a month’s well worth of transactions, but envision your spreadsheet lists of transactions for an whole calendar year. You could use a PivotTable to individual your transactions by month to improved recognize your company’s funds flow. That would acquire hours by hand, but it is only moments with PivotTables.

How to use Excel for your small business accounting wants

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


Despite the fact that several accounting application platforms have budgeting characteristics, I’d pick Excel every single time.

Get started your small business funds by exporting an profits assertion from your accounting software to Excel. Clear out the quantities and include columns for every single month of the interval for which you’re budgeting. Then start out moving into your budgeted numbers and voila! You have a budget.

As your business’s funds get more concerned, you can develop granular sub-budgets that roll up into your business’s master spending budget. Excel can cope with it.


If your accounting program does not have an invoicing characteristic, you can simply make professional payments as a result of Excel.

Microsoft Phrase also has bill templates, but I wouldn’t advise working with them since Word templates cannot do any arithmetic for you. Excel invoice templates routinely sum bill line products, decreasing the threat of human mistake. You would not want to be dependable for underbilling a customer simply because of an arithmetic oversight.

Expenditure reports

Each time you reimburse an personnel for mileage or yet another organization price, you should ask for receipts and an price report that tallies all fees in one particular document. There are hundreds of price report templates to select from online.

Accounts receivable and accounts payable

Lots of compact firms keep track of who owes them and whom they owe with an Excel spreadsheet.

Enterprises on the cash accounting technique only document earnings and fees when cash comes in or out. Excel is the best repository for a record of remarkable customer invoices and your business’s unpaid costs because they have no area in your accounting data till dollars modifications fingers.

Accrual-basis organizations history receivables and payables in their accounting software program when they make revenue and incur fees, respectively. They should not need to keep track of their receivables and payables anywhere else.

Bank reconciliations

Bank reconciliations, just one of the bookkeeping essentials, compare your company’s accounting documents with its bank statements. You can put both of those facet by aspect in Excel and speedily scrutinize any discrepancies.

Numerous accounting software package methods have lender reconciliation applications, but I choose to use Excel to execute regular reconciliations simply because of its no-frills interface. Get started the financial institution reconciliation by downloading Excel variations of your company’s general ledger and financial institution assertion. Then, copy and paste the info into one particular spreadsheet and start off reconciling.

3 best methods when utilizing Excel accounting program

Steer clear of producing additional function for on your own by pursuing these most effective procedures.

1. Permit formulas do the do the job

The finest guidance I have been given about working with Excel for accounting is to stay away from “hardcoding” quantities anytime probable.

Imagine you are setting up your company’s funds for next year. You approach to pay back all workforce the condition minimal wage of $12 per hour. You later discover that the least wage is going up to $15 upcoming calendar year. If you made the finances working with formulas the first time, this correct should really take no a lot more than 30 seconds.

Hardcoding a number implies moving into an genuine selection, not a method, into a cell. The only quantities I hardcoded under are the $12 bare minimum wage and the regular monthly several hours for each employee. Formulation calculate the employees’ regular monthly gross spend.

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 budget shows an employee’s monthly several hours multiplied by the minimal wage.

Bridget’s regular monthly fork out is calculated by multiplying her every month hours by the state minimum amount wage. Experienced I independently multiplied 12 and 30 in every single cell, I would have to redo the total payroll finances. Many thanks to the system, I can only modify the 12 to a 15, and all the month-to-month payroll amounts will instantly update.

A bonus tip: The dollar symptoms in the system “lock” the row and column you’re referencing, so if you copy and paste the system from 1 cell to an additional, it will carry on to reference the similar location instead of adjusting for the new cell’s locale.

2. Help you save Excel accounting information securely

Any place you retail store fiscal information must be secured by a password that only a privileged several know. Password-guard Excel data files with delicate info, such as staff Social Stability numbers.

Don’t overlook to again up data files that are not stored in a cloud storage procedure.

3. Develop template information

Help you save your invoice and expenditure report templates as template information. When you open up a template file, it generates a new document that will not overwrite the first template.

After you obtain and tweak your price report template, click on “Save As Template” and help save it to an available position for you and your staff. Any time another person clicks on the template file, you can be positive they won’t inadvertently damage all your tricky function in building it.

Excel with Excel

Excel can be intimidating at initially, but the feeling fades quickly. It’s like assembly your in-regulations for the first time (hopefully).

Start off exploring Excel’s capabilities by downloading an expenditure report or bill template and tweaking it to suit your small business. Before long sufficient, you are going to gain the know-how to put into practice it far more widely in your company.

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