Lets start with how things used to be this time last month. For each project, we'd write down or fill in a spreadsheet the time spent on each task so we could monitor if we're going over budget. If we did extra work or bought additional items like Stock Photography or commercial CMS modules, these would also get logged in another place to be billed at the end.
Every time an invoice got made (in Word), it got exported to PDF, an entry was then made in an Invoices spreadsheet with the name, due date, amounts etc. I then had to use this to keep track of which invoices were overdue. As invoices got paid I'd check in the bank account then mark them off with the date and amount in the Invoices. Then I'd be transferring a set % to the tax savings account, and a bit more to other funds like a holiday fund... which meant more transactions into the bank account spreadsheets to record money saved for end of year tax. Then when I move money around between accounts for personal accounts... more spreadsheets... and all knowing that come end of the year I'll be revisiting those spreadsheets to make more for the accountant in a way that can be turned into a tax return.
Unsurprisingly, I had grown to hate all those spreadsheets.