The use of digital bookkeeping systems

Whilst some business do still keep their books in manual systems many now use electronic versions, these could be in Excel, custom software, Xero, QuickBooks, Sage and many others.

Features of Digital Systems

Digital creation of invoices
Digital recording of purchase invoices
Automatic import of bank transactions
Assistance in making electronic payments
Automatic updating of the general ledger
Importing transaction data from third parties
Automatic creation of transactions from third party documents

Benefits

Balancing of the cash book
Automatic transfer of date from the day books to the ledgers
Automatic transfer of data to the control accounts
Assistance in the reconciliation of accounts to bank accounts and control accounts etc.
Creation of a trial balance
Handling repeating transactions
On demand reporting against the accounts e.g. trial balance, customer statements
Reduction in errors as double entry is handled automatically

Drawbacks

As the double entry is handled automatically the main drawback is it's possible an incorrect value may not be picked up as it will be automatically balanced off the automatically added second value. Also be aware of repeating transactions where the value has changed.