Where business is concerned, it goes without saying that keeping your finances in order is imperative. Not only is it necessary in order to ensure that invoices are sent out and paid on time, and to help with forecasting cash flow, but detailed financial records are critical when the taxman comes knocking.
Fortunately, this is much easier than it used to be. Today's accounting software and invoicing packages are built for business owners, not accountants, which means there's no complicated jargon and you can be up and running in minutes. Cloud-based services let you monitor your business from anywhere on a range of devices, and there's no need to worry about backups because the provider will handle that for you, too.
There are many features to consider when choosing accounting software. Okay, you know you need invoicing, but what about quotes? Time tracking? Purchases, payroll, credit control and more? Every package has its own mix of features, and they're not always directly comparable. To save you trawling through free trial after free trial to find the package that's right for you, we've highlighted some of the best packages available to help you get started.
- Also check out our feature on everything you need to know about small business accounting software and our best free accounting software packages
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FreshBooks is a popular cloud-based accounting service designed specifically for small business owners.
The package has plenty of features – invoicing, expense tracking, time tracking, a host of business reports, even an option to take credit card payments (for a 2.9% plus 30 cents transaction fee) – but a straightforward interface aimed at non-accountants ensures you'll be up-and-running right away.
Despite the simplicity, there's real depth here. You can bill in any currency, save time by setting up recurring invoices, allow customers to pay via credit card by checking a box, and even automatically bill their credit card to keep life simple for everyone.
If you need more power, the system integrates with many other services, including PayPal, MailChimp, Basecamp, WordPress, Gusto, Zendesk and more.
Management hassles are kept to a minimum. You're able to access and use the system from your desktop or its free iOS and Android apps, and because it's a cloud-based system there's no need to worry about backups.
If this sounds appealing, you can try FreshBooks for 30 days without using a credit card.
The Lite plan gives you invoices, estimates, time tracking, expenses, plus the ability to accept online credit card payments and import expenses from your bank account. It's $15 a month, but only covers you for five clients.
The Plus plan supports a more reasonable 50 clients, adds the ability to send proposals, and saves you time by providing recurring invoices and the option to automatically send payment reminders. It's decent value at $25 a month.
The $50 a month Premium plan lifts the client limit to 500, and further users can each be added for $10 per month.
Intuit QuickBooks may have been around since the days of DOS, but the latest version is right up-to-date – it's an easy-to-use cloud-based suite for just about all your business needs.
Even the Essentials plan for $17 per month has plenty of features: invoicing, expense tracking, payment handling (with a 2.9% + 25c transaction free), plus it allows you to track and calculate VAT, and manage payroll and pensions for an extra $2 per employee per month.
Just like FreshBooks, there are a pile of apps to add more features: inventory management, Shopify integration, job scheduling, CRM and more. These can be expensive – many services cost more than QuickBooks itself – but there are exceptions.
Add GoCardless (which is available for UK customers), for instance, and you're able to set up and take regular Direct Debit payments from customers for a mere 1% transaction fee capped at £2 – and there are no sneaky setup charges or other hidden extras. QuickBooks also offers mobile apps for iOS and Android.
Overall we'd usually prefer FreshBooks, but there's plenty to like about QuickBooks, too, and with free trials available it's easy to try them both.
Xero might grab your attention with its low $9 per month Starter account but look closely and limitations soon become apparent – like being restricted to sending a maximum of five invoices, entering five bills, or reconciling only 20 bank transactions.
Still, if you can live with those restrictions there are some pluses here. The service offers smart expense tracking and management, optionally on your mobile with Xero's excellent app for Android and iOS. There are dozens of configurable reports, simple budgeting, and no limits at all on additional users or the accountants you might want to access the data.
If the invoice, bank or billing issues are a problem then the Xero Standard plan looks like a better deal. It's a lot more money at $30 per month, but you can issue as many invoices and enter as many bills as you like.
One disappointment is the lack of support for multiple currencies, which only arrives if you sign up for Xero Premium for $60 a month.
Xero offers plenty of functionality, including a handy “convert your QuickBooks files” service to help you get started, and it's certainly easy to use. But if you don't quite need all that power, there's better value to be had elsewhere.
Sage Business Cloud Accounting makes a good first impression with its clear and gimmick-free pricing. The top Sage Accounting plan offers decent value at just $25 per month. There is also a 30-day free trial.
For this, you get modules to manage quotes, invoices, handle and submit VAT online, smart bank feeds and reconciliation, cash flow forecasting, some detailed reports, multiple currency support, project tracking and more, all available from your desktop or via a mobile app.
All this is well presented and generally easy-to-use. If you run into trouble, detailed web help and video tutorials are only a click or two away, with the offer of “free unlimited 24/7 telephone and email support” that should help make any newbie comfortable.
Sage also has a more basic offering called Accounting Start. This doesn't include support for quotes, estimates or vendor bills, and has no cash flow forecasts, but it's only $10 per month and could be enough for small businesses.
Choosing an accounting package often involves browsing a complicated comparison table, looking for hidden catches and trying to figure out which is the best product for you.
Kashoo avoids all that with a single $19.95 a month plan, or $199 annually, which delivers just about everything you're likely to need.
Kashoo shines when it comes to multi-currency support, an important feature for today’s global economy. It also supports credit card transactions for all the major carriers – Amex, Visa and Mastercard – at a competitive 2.9% plus 0.30 cents transaction fee.
You also benefit from unlimited invoices and connections to over 5,000 financial institutions to reconcile accounts online. We liked the uncluttered interface of this product, and the dashboard that provides a good summary of your current financial situation at a glance.
Kashoo also offers customer support across the gamut of email, phone, live chat and social media – this company will even respond to an old-fashioned letter! One current shortcoming to note, however, is that there is only a mobile app for iOS, leaving Android users out in the cold for the time being. Kashoo offers a 14-day trial for those looking to test the service out.
Also consider these accounting software platforms
Zoho Books is a simple solution for the self-employed and small businesses, who don't need all the bells and whistles, or cost, of full-on accounting software packages. It still comes packed with essential features, but keeps things simple and comes in at a lower price than other platforms. It's also scalable, so if you find you do need more, it's possible to purchase additional plans, features, and extensions to cover your requirements.
Certify is a solution for tracking expenses rather than full accounts, but could be very useful to have in addition to some of the platforms above, not least because not all of them can track expenses with such dedication. This is especially the case for small businesses with a number of employees, where expenses might not always be reported or submitted properly, even though there is a potential tax deductible saving for the business for doing so.
Financial Force is specifically designed to provide a cloud accounting and finance solution for Salesforce. This means full tracking of customer accounts across multiple workbooks, as well as recording assets, payables, collections, and more. This makes Financial Force less of a simple accounting platform and takes it into the realm of enterprise resource planning (ERP), and it is potentially very useful for those businesses already running Salesforce software.
Holded is another software platform aimed more at enterprise companies, offering an ERP that brings together sales, accounting, inventory, project and time management into a single dashboard. However, despite these diverse elements, the accounting feature is fully developed, and includes automated billing, along with instant reports on profit/loss, and the balance sheet.
Tipalti is another big ERM platform and bills itself as the only end-to-end solution to automate the entire global payables operation in a unified cloud platform. At this point we're talking about a platform that goes well beyond accounting and into direct tax compliance and financial risk assessment, clearly intended for Fortune 500 companies that need full audit trails on a global scale, which is probably why Amazon is advertised as a customer.
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