Every entrepreneur needs to record company financials for tax reasons. The basic form is balance sheet, income statement, and cash flow. I’m not talking about the software that that the big corporations use for their accountants. There is a lot of information that can be provided with just a simple spreadsheet. You just need to know how to format it and present it in a way that is easy to read. It takes a lot of time and effort on your part, but it’s worth it because those reports will provide you with the accurate data you need regarding your company’s financial health.
It is a known fact that bookkeeping is a crucial part of running a business. A professional bookkeeper will make sure you stay organized and avoid making any fatal mistakes. That said, accounting software is a great tool for small businesses. It can be quite a challenge to set up bookkeeping software along with your accounting software for your business.
1. Xero
Xero is our top accounting software pick for small-business owners—its ease of use, low starting price, and thorough features set it apart. The software’s bookkeeping features include double-entry bookkeeping (the most accurate bookkeeping and accounting method), plus dozens of customizable reports. In contrast to most accounting software, Xero includes unlimited users at no additional cost. You can generate interactive financial reports any time and send them to your key financial collaborators, including business partners or tax advisors.
Even though we generally prefer Xero to QuickBooks, QuickBooks Online remains the most popular accounting software for US-based accountants, bookkeepers, and auditing clerks. For instance, most virtual and outsourced bookkeeping services still use QuickBooks or proprietary in-house software—though some, like Bookkeeper360, also sync with Xero.
While QuickBooks Online wins our top spot for now, we’re hoping that as Xero’s user base expands, more accountants and bookkeepers will sign on. That should make collaboration easier for Xero-using small-business owners who (wisely!) work with financial advisors around tax time. And thousands of accountants and bookkeepers do use Xero already, so you can search Xero’s directory to find a local accountant who’s already familiar with the software.
2. Zoho Books
All of Zoho Books’s plans include business overview reports, like profit and loss statements. But Zoho Books goes beyond the basics by offering customizable reports in the following categories:
- Sales reports
- Inventory management and reports
- Accounts receivable reports
- Payments received reports
- General activity logs
Zoho also lets you tag reports in ways that are easy for you to sort through, read, and understand. In other words, instead of making non-bookkeepers work to understand their financial data, Zoho Books’ straightforward reporting and simple organization reduce work for non-accountant business owners.
If you make less than $50,000 USD per year, you might qualify for Zoho’s free plan. It includes access for one user plus one accountant or bookkeeper, a chart of accounts, and bank account reconciliation. Bear in mind that the free plan lacks some of the automation that sets Zoho apart, such as automatic recurring expenses and report tags.
If you want more in-depth reporting, you’ll get the most out of Zoho Books’s reports by integrating with Zoho Analytics. Analytics plans start at a reasonable $24 a year, but if you want the best reporting Zoho Analytics can provide, you’ll need the Premium plan at $115 a year. That’s in addition to your monthly Zoho Books fee, so make sure to weigh the cost of any Zoho add-ons before committing. (Zoho largely syncs with other Zoho products, not with more affordable third-party apps.)
3. Bench
Bench prides itself in being a simple, yet affordable online bookkeeping service for entrepreneurs. It’s an online service with a human touch.
Every plan comes with a dedicated bookkeeping team. If there is a need to, they can get your books up to date. Just one of the things you’ll never have to worry about if you choose Bench!
As a small business owner, you will be provided with the following online bookkeeping services:
- Dedicated team + support
- Categorized and reconciled transactions
- Financial reporting (income statements, balance sheet, expense tracking, etc)
- Desktop and iPhone app
- Tax prep and filing (additional service)
Regarding the tax services, Bench will prepare everything you need to file and work with you or your CPA. Or, if you purchase the BenchTax service as an add-on, they will even file your taxes for you!
The only thing lacking is CFO advisory services – not offered at all. If you needed help with your financial strategy, we recommended looking into other online accounting firms.
If you are not sure whether Bench is the right choice for you, you can start a trial and get free online bookkeeping services for a month.
4. inDinero
- CFO services
- Mobile app
- Account manager
- Tax preparation and filing
Founded in 2009, inDinero is not the typical provider. Its basic plan is aimed at new companies that require online bookkeeping services. However, it also offers a custom plan for growing companies. inDinero has its own accounting software, but you can also use it with QuickBooks Online.
You get quite a lot of goodies:
- Account manager
- Automated transaction imports
- Mobile app
- Document management
- Monthly reconciliation
- Profit and loss
- Balance sheet
- Employee reimbursement
- Accounts payable/accounts receivable tracking and reporting
With the add-on features offered, inDinero can provide you with all the online accounting and bookkeeping services your company needs. You can choose from:
- Revenue recognition
- Inventory reconciliation
- Cash flow projection
- Payroll support
- CFO services
- Tax preparation and filing
5. GoDaddy Online Bookkeeping
GoDaddy Online Bookkeeping’s cheapest plan lets you send invoices and estimates, track mileage, accept online payments, and chart your business’s annual finances. The software’s simplicity makes it perfect for freelancers, Amazon and eBay sellers, and Etsy shop owners who want to track finances and bill customers as affordably as possible.
Want a bit more heft? The Essentials plan ($9.99 a month) gives you unlimited business reports so you can compare your finances from year to year. Unlike the cheapest plan, Essentials also syncs automatically with data from PayPal, Etsy, eBay, and Amazon. Paying nearly $10 a month is a little high for GoDaddy’s limited accounting features. Still, if you want the convenience of automatic data imports without the accounting complexity of QuickBooks Online, GoDaddy is the way to go.
6. Wave
Best for invoice, accounts, and cash flow management for free.
Wave is free accounting software for businesses and individuals. The software can be used for basic accounts management. You can use the application to track expenses, cash flow management, and sales and purchase management.
Features:
- Invoice management
- Cash flow management
- Payroll
- Purchases
Cons: Lack of advanced features.
Wave is a simple accounting package that is completely free. It has features that will meet the needs of most business owners and self-employed individuals. You won’t have much to complain about the accounting software since it is free.
7. Pabbly
Best for basic accounting and expense tracking for business owners.
Pabbly boasts of different account management features. The software has all the features required for managing financial transactions by business owners. It supports reports, invoices, workbook events, and other features.
Features:
- Recurring billing and subscriptions
- Invoice management
- Expense Tracking
Cons: Limited Accounts feature
Pabbly is a solid accounting tool with great features. It is suitable for independent contractors and business users.
Conclusion
If you’re a small business owner, you need to take care of what matters most, and that is to make sure your cash flows. It doesn’t matter if you’re a one man operation or a multi-million dollar company, bookkeeping is not just an optional task. It’s in your best interests in order to keep track of where the money all goes and what your financial position is at any given time.