Accounting software is an application

Accounting software is an application or set of applications that records and processes accounting transactions according to the rules and regulations specified and takes every single transactional entry up to the final books like trial balance, profit and loss accounts and balance sheet automatically. Accounting is a part of life, it is required everywhere be it home, shop, services, companies or government departments. The books containing information about money transactions are compulsory. 

Accounting software makes the task of keeping account books easy. This is done in few ways like software helping a lay man in keeping his books who has no knowledge of accounting rules. Software helping small to large organizations in maintaining books with ease by doing processing and recording on its own and relieving accounts department from repetitive work and another way is to help in analyzing the accounts data for better and profitable decisions and getting alerts for wrong decisions or pitfalls.

Accounting software generally contain modules like accounts receivables, accounts payable, general ledger, billing, inventory, purchase order, sales order, bank book and cash book. These are core modules of accounting software however non core modules may include more options like debt collection or outstanding, payment performance, expenses, payroll etc.

Accounting software can be classified as per their functionality in few categories. Personal accounting software are meant for simple accounting purposes like managing budget, expenses and income for personal accounts. These software also include reports for reconciliation like bank book and expense sheet. Inventory-accounting software is another category of software used with sales and purchase options, few of those have stock option too and use single entry system for accounting. These software are very low in terms of functionality and support only one type of regulation and currency. These software are not designed with GAAP or IFRS compliance and just provide accounting as additional feature with the software