If you’re starting a company or any business, you will have to deal with accounting. No matter if you’re managing your business alone or have additional staff, there are tools your can use. Accountants have access to so many tools that aren’t available to the public. The “tools” are the best accounting tools for businesses.
Accounting tools are vital for any business operating these days. The economic climate means that you have to be more efficient, compliant and have a greater understanding of your balance sheet than ever before. Accounting tools allow you to do all of this. When it comes to choosing the right tool, however, there are so many factors at play. As your customer’s accountant, I know how stressful it can be..
1. Kashoo
Kashoo is a good fit for sole proprietors, freelancers, and very small businesses, and is one of the better options for those that want to keep track of income and expenses, but are uncomfortable connecting their bank accounts to an accounting application.
Kashoo makes it easy to enter income and expense transactions manually. Source: Kashoo software.
Kashoo offers four distinct activity areas; Actions, Lists, Reports, and Add-Ons. This makes it easy even for new users to jump in and get started using the application without the need to spend extra time learning the ropes.
The application uses a combined income/expense screen where you can record both income received and expenses paid. You also have the option to connect Kashoo to your bank account, but the income/expense feature makes it easy to record necessary transactions without connectivity.
Kashoo offers easy invoicing, with the ability to pay vendors electronically as well as by printing checks, another option that isn’t readily available in other applications. Kashoo also makes entering journal entries a snap, and the list feature lets you track client, supplier, and item details.
Kashoo reporting options are sparse, with only eight reports available, though complete financial statements can be run. Reports have limited customization, but can be exported to Excel if desired.
The benefit of using Kashoo is that it makes it easy for new business owners to enter financial transactions. Another benefit is that while you’re given the option to connect your financial institutions, Kashoo works just as well if you choose not to.
Kashoo offers a single plan at the cost of $19.95/month, or $199/year, and supports an unlimited number of users.
Read The Blueprint’s full Kashoo review
2. ZipBooks
A great fit for freelancers, small businesses, consultants, and contractors, newcomer ZipBooks includes great time-tracking capability.
A great addition to any business that needs to track hours in order to bill clients, ZipBooks is a good option for solo attorneys and accountants or any other professional who routinely bills for time.
ZipBooks built-in timer is a great addition for attorneys, accountants, and other professionals. Source: ZipBooks software.
ZipBooks users a built-in timer to track time, with the timer displayed at the top of the user dashboard for easy access. The timer can be started and stopped as needed, and you can record notes along the way for billing purposes.
ZipBooks offers good accounting functionality, with the option to link bank accounts. In addition, if you do link the application to a bank account, ZipBooks uses a built-in algorithm that assists in transaction categorization, remembering how a previous transaction was recorded, in order to record it properly.
Invoicing options are also available in ZipBooks, with the ability to customize invoicing as desired, with an option to add a payment link to any invoice.
Reports in ZipBooks are fairly basic, though the application does include intelligence reporting which includes a business health score.
One of the biggest benefits of using ZipBooks is that it offers a free plan, which allows you to start small and scale up to a paid plan when necessary.
Along with the free Starter plan, ZipBooks offers two paid plans: Smarter, which is $15/month and supports up to five users, and Sophisticated, which is $35/month and supports an unlimited number of users. An Accountant version of ZipBooks is also available for accounting professionals.
Read The Blueprint’s full ZipBooks review
3. Wave Accounting
One of the best accounting software applications for freelancers, sole proprietors, and micro-businesses, Wave Accounting is completely free accounting software. And when we say free, we mean free.
Not just a few of the features, or a starter plan, but the entire application is free. You’ll only pay extra if you want to accept payments online through Wave Payments or choose to use their payroll service.
Wave Accounting makes it easy to set up your business. Source: Wave Accounting software.
Wave offers excellent invoicing capability, as well as the option to connect your bank accounts directly to the application. Recurring invoicing is also available in Wave, which is a time-saving feature for those who bill on a regular or retainer basis.
You can manage your customers in Wave, but the application offers limited opportunity to track customer details. Although you can add both products and services to Wave, there is no real way to track inventory movement, making it a much better option for service and consulting businesses.
Wave includes 12 standard reports, with financial statements available. Reports have limited customization capability but can be exported to a CSV file for customization if necessary.
Wave’s no-cost price tag can be a huge benefit for small businesses and startups with a limited budget. The downside of the application is limited support availability, with support only offered by submitting a request. However, live email support is offered to those who purchase Wave Payments and Wave Payroll.
Wave Accounting is 100% free for the entire accounting application. If you choose to accept online payments, you’ll be charged 2.9% plus a $0.30 fee for each transaction, a very reasonable price.
Wave Payroll currently charges a base fee of $35 per month, plus a fee of $4 per employee, though full-service payroll is only offered in eight states.
Read The Blueprint’s full Wave Accounting review
4. Xero
If you’re an app person, you’ll love Xero. Designed for small businesses that want an application that is designed to be used on the go, Xero’s multi-currency capability also makes it a good fit for those who do business globally.
Xero offers connectivity to hundreds of apps.
Source: Xero software.
While Xero offers accounting features comparable to other similar products, its strong suit is its ability to integrate with more than 500 apps.
While this may not matter to the sole proprietor or freelancer, app integration can help fill the holes that are typically found in entry-level accounting software applications, making it a great fit for niche markets like IT, startups, and e-commerce businesses.
The business interface in Xero offers quick access to invoicing, bill payment, and customer quotes, while standard accounting functions are found under accounting.
Xero discourages the use of journal entries in the application, recommending that you connect your bank accounts with the application to manage income and expenses, but it does include journal entry capability.
Xero also offers good project management, with the ability to track completion dates and performance throughout the life of the project.
Reporting options are fairly basic in Xero, though financial statements are available. All reports can be exported to Excel if needed.
Of course, the biggest benefit of using Xero is accessibility to all of those apps. It’s also great for those with limited accounting knowledge.
Xero offers three plans: Early, which has limited functionality and is $9/month; Growing, which runs $30/month; and Established, which is $60/month, and offers project tracking, multi-currency, and expense management.
Read The Blueprint’s full Xero review
Bonus
5 Tools Every Accountant Needs
The accounting field offers job stability and the opportunity to work with individual people or corporations. Those who work as accountants need five key tools to operate efficiently and effectively. These include:
A Quality Computer
Once you become an accountant, your computer will take the brunt of the workload. Because of this, you’ll need one that is fast and competent. Be sure to purchase a computer that has a processing system capable of running your document management and tax software. For accountants, a computer is the foundation of every other industry element. After selecting one, maintain it to ensure that it operates properly. Complete regular cleanups by eliminating old data that you no longer need. Avoid downloading documents that are likely to slow it down, and be sure to install antivirus software.
Project Management Software Through the Cloud
When considering necessary accounting tools, a solid cloud-based project management system will help you stay organized. In the accounting industry, you’ll likely have a number of cases that you’re working on simultaneously. A cloud-based management system makes it easier for you to stay on top of your projects. If you work in an office environment with a team of accountants, then cloud computing gives everyone in your office access to the same accounts and systems. This feature makes communication more convenient. Cloud-based systems also increase efficiency. You can avoid requesting status updates from other people who are working on the same project, and you won’t be forced to share information through email or on paper.
Related Resource: What Kind of Skills Do I Need to Become and Accountant?
Tax Software
By entering the accounting industry today, you’ll benefit from modern-day technology. This includes tax software. In the past, accountants processed taxes by hand. This was a major inconvenience when errors were made or if clients forgot to include important tax paperwork since the situation required the accountant to reconfigure the numbers entirely. With tax software, errors and missed papers are easy to correct since you’ll just need to adjust the figures within the system. The software will take care of the rest. Tax software saves time, and it decreases mistakes because IRS coding is included in the program.
A Paper-Free Document Management System
A paper-free document management system increases efficiency while making it easier for your clients to share their important files with you. This type of setup allows you to operate without keeping paper files. Without paper, you’ll be decreasing your need for physical storage units. When a client calls with a question about his or her paperwork, you’ll have almost immediate access to the documents to answer questions right away. You can even pull up your files from different devices, so if you’re away from the office, you’ll still be able to offer assistance. The system also makes it easy for you to travel for work.
Basic Accounting Gear
While technology makes most accounting tasks easier, don’t overlook the need for a basic set of old school accounting gear. Invest in a good calculator, a box of high-quality pencils and notepads. As you begin your accounting career, you’ll discover that the line of work is about capturing details. You don’t want to rely solely on software to do that. You may need to take notes about an account that you’re processing. In addition, if you spot a discrepancy, you’ll need to double check documents by hand. Keep in mind that you’ll win clients with your expertise, professionalism and quality accounting skills.
With the right accounting tools, you’ll be ready to begin a rewarding and stable career as an accountant.
Conclusions
The first thing people think of when they hear the term “accounting” is the total end of their day. A lot of us think that it’s a boring and stiff topic to study. However, I’m here to explain why you shouldn’t let this thought bother you. Accounting is not boring at all.