Posted January 18, 2016
5 tips on choosing bookkeeping software….
Choosing the wrong software for your business can be an expensive and time consuming mistake. Accounting software can not only reduce human errors but it can help you look at your business in more detail – some can even help you prepare forecasts and identify overstocked items.
There are several factors you should consider when choosing accounting software, below are five things to consider.
Type of Bookkeeping Software
There are hundreds of different account software packages, with more being released all the time, generally they fall into the following four categories:
Small business payroll and accounting
There are many accounting software packages you can buy off the shelf or online, that will meet of the needs of a small business. In the UK the most popular ones are produced by Sage or Quickbooks.
Cloud accounting software
In the last few years this type of software has really take off and is now a major challenger to the traditional small business packages offered. Cloud accounting allows businesses to access their records any time anywhere providing they have access to the internet. You will soon be able to access your Xero records on your Apple Watch!
Business management software programs
These are higher-priced products with more features and are designed for larger or more complicated businesses. They include features that will allow you to keep track of your business and often include features such as CRM, point of sale, inventory control, and the ability to deal in foreign currencies.
Free accounting software
Businesses should be sceptical of “free” programs, particularly when you are dealing with your businesses financial data. Some cloud accounting providers offer a very basic free package to small businesses – some limit the number of transactions or employees. You should note that these packages will be limited and often don’t include standard functions such as remembering customer details.
Cloud accounting software tends to be invoiced monthly and often includes software updates and access to a helpline. Whilst traditional accounting or business management packages are generally charged either as an upfront cost or on an annual basis.
The majority of providers offer a variety of price levels depending on what you need from your package and the size of your business. You should do some research, for instance if your business has more than 5 invoices and bills a month Xero will cost £20 per month (currently discounted to £10) whilst Kashflow will cost £10 per month for unlimited transactions.
Size of the Business
The size and complexity of your business will affect the software you choose.
A cloud accounting package such as SageOne is tailored towards smaller businesses, whilst Xero and KashFlow offer different packages for different sizes of businesses.
If you have large or a more complex business for example doing a lot of importing/exporting you probably need to consider a business management software such as Exchequer or bespoke package that is aimed directly at your industry.
Accessing your Records
Do you want your accountants to have simultaneous access to your records or to have access to your accounts from a mobile or tablet? If the answer to any of these is yes you should consider cloud accounting software such as Xero, or Kashflow. If you are happy to just have access to your records from the office and don’t want to have your records “in the cloud”, then something like Sage or Quickbooks would be more suitable.
How Easy is it to Use?
Many accounting software providers offer free trials; these are definitely worth trying. If you are finding it hard to use or time consuming to enter your transactions do you really want to continue with the software. Try out a couple of providers because they all work differently and pick your favourite.
We hope these tips will help you choose an accounting software provider, but if you want further advice on what would be suitable for your business or want to discuss any issues raised in this blog please get in touch.
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