Do you want to learn more about great small business accounting software? This article will give you an overview of what free accounting software options will be available for you. Also, desktop small business accounting software is also discussed, especially if you’re looking for an easy to use accounting software package.
Small business accounting software is software used by small businesses to keep track of their financial information. It’s no wonder accounting software for small business is so popular, with over 280 million businesses in the world, the vast majority being small businesses, accounting software for small business is an industry that has its hands full.
What is accounting software?
Accounting is the language of business. And numbers tell the truth about a small business’s performance. Accounting software does a lot more than bookkeeping. It gives you insight to make important decisions. It keeps track of your business and pinpoints problems. Read on to find out which accounting software is best for your business.
Accounting software is powerful. More than ever, it helps you do more with less work and knowledge. It shows you how you’re doing and where you’re spending your money. The right accounting software should fit your budget and needs. It should help you:
- Handle bookkeeping tasks.
- Organize receipts.
- Pay bills from suppliers and pay your employees.
- Track sales and calculate sales taxes.
- Generate invoices.
- Gather information for tax returns.
- Track time, mileage and other business expenses.
Small business accounting software comes with different features. More sophisticated products include payroll, inventory, analytics and other modules.
Here are some tips to help you maximize your accounting tasks and software use:
- Use the right accounting software: Your needs should determine the right software for you. If your small business is a two-partner operation, avoid software that targets larger incorporated businesses. More on that later.
- Get organized: Keep accurate records of expenses and enter sales and expenses into software as they occur. Track performance and automate tasks like invoicing.
- Build accounting into your business: That way, you’ll have the numbers you need to make decisions at your fingertips. Also, tax prep will be much easier.
- Keep track of mileage: Some software lets you track your business drives on your smartphone and export location data.
- Stay on top of tax payments: Accounting software automatically calculates taxes and helps you make sales tax payments on time.
If working with numbers isn’t your idea of fun, seek help from a professional accountant or bookkeeper. If you prefer to do at least part of the work, ask your accountant which software they recommend.
What is the best accounting software for small business?
There are plenty of options available, such as QuickBooks, FreshBooks and Zoho. As mentioned above, to drill down into features and comparisons, head over to PC Magazine and financesonline for detailed reviews. You can download a free trial version to try before you buy.
QuickBooks is a household name in business accounting software and is a popular choice for a wide range of needs. Its leader status and vast feature set also come with a higher price tag though.
On the other hand, QuickBooks’ secret sauce is its integration with TurboTax, the leading tax preparation software. Intuit makes both products. This integration lets you transfer your numbers seamlessly with a couple of clicks at tax time. It also eliminates the need to retype numbers and prevents human error.
Sage50cloud is a solid advanced choice with tiered versions for larger small businesses. New integration with Office 365 targets businesses with more sophisticated needs. On the other hand, it lacks the flexibility and mobile app features that Quickbooks and Xero offer. Zoho Books is a more affordable option for small businesses.
For freelancers and the self-employed, Freshbooks is a popular choice because of its ease of use and simple interface. Freshbooks and Wave are two choices that offres a free version for those who have basic needs.
Why Microsoft Dynamics for accounting?
The Microsoft Dynamics suite of software has long been a valuable tool for business accounting. The brand launched in 2005 with no less than four established, market-leading ERP programs in its stable, offering solutions for businesses with a variety of individual needs.
Dynamics GP was an ideal platform for companies who’d outgrown entry-level accounting systems and benefited from capabilities like integrated payroll functionality, and Dynamics SL was the top choice for project-based businesses. Dynamics NAV boasted a wider range of features for manufacturers and international organization, and Dynamics AX offered a comprehensive back-end solution for all financial and operational needs.
Today, those nomenclatures have been retired, and all of the suite’s ERP capabilities are pooled together under one umbrella; Dynamics 365. Many of the areas of functionality found across the stable’s legacy products, such as human capital management, and retail, have been siphoned off into their own apps, but the bulk of Dynamics 365’s accounting features are contained within two comprehensive ERP apps; Dynamics 365 for Finance and Operations, and Dynamics 365 Business Central, built for large and SME-level businesses respectively.
Gartner’s most recent Magic Quadrant for Cloud Core Financial Management Suites listed Dynamics 365 for Finance and Operations as a Visionary due to its broad financial functionality, wide geographic coverage, cloud focus and plans for finance line-of-business marketing.
The software scored above average with Microsoft customers in overall functional capabilities, with flexible GL analysis capabilities, good multi-company features, and strong project accounting. The report also highlighted the app’s broad geographical coverage and support available from Microsoft’s global partner network, and its innovative use of technology for analytics, with embedded Power BI and real-time, in-memory multidimensional analysis.
Built on the foundation of decades of experience in the ERP industry, Dynamics 365 is a natural next step for organizations that have outgrown entry-level accounting software, that want to be able to derive more value from their financial management, or that want to bring all of their back- and front-end operations into one centralized system.
Whichever app you feel is the right fit for the scope of your organization, both options feature extensive benefits for businesses who need sturdy, intelligent accounting tools.
Dynamics 365 for Finance and Operations
Dynamics 365 for Finance and Operations, built on the foundations of what was previously known as Dynamics AX, is Microsoft’s most advanced and extensive ERP system, featuring modules such as financials, manufacturing, and supply chain management. It comes bundled with two additional apps for retail and human resource management. The app is geared towards large businesses of 250+ employees, and carries a 20 user minimum.
As the suite’s most comprehensive ERP program, Finance and Operations boasts all the financial management capabilities you’d expect, plus the benefits that come with an intelligent, cloud-hosted solution.
General ledger, account payables and receivables, budgeting, account schedules, and bank reconciliation capabilities are all included in Finance and Operations, helping businesses oversee their incomings and outgoings.
Finance and Operations’ general ledger tools allow you to create your own chart of accounts that perfectly meet your company’s needs, and map general ledger accounts to custom categories tailored to the structure of your financial statements.
The app’s SSRS-based reporting helps generate analysis that’s both in-depth and immaculately presented. Reporting in Finance and Operations is also hugely flexible, allowing you to view and analyze data in real-time, so you don’t need to wait until monthlies roll around to see how things are going. Plus, you can add categories and subcategories to GL accounts so you can generate intuitive, practical reports faster.
Its modern, streamlined Accounts Receivable Collections and Management dashboards can be configured exactly the way your particular business needs dictate. From this interface, you can apply incoming payments to the appropriate customer or vendor ledger entries, close up related sales invoices, and reconcile the bank account once payments are received. No need to manually keep track of overdue invoices either; auto-generated collection letters can be set up to notify customers of past-due balances, and predefined interest codes allow the app to automatically apply late payment charges.
Integration with bank feeds allow you to carry out online reconciliation of bank transactions without leaving the app. By importing banking information, users can update customer payments automatically based on data received from the bank too.
Users can also generate vendor payments prioritized by discounts and penalties, export payments directly to a bank file, and make payments using purchasing cards, ACH transactions, or checks.
Budgets can be developed, updated and amended in real-time, improving your organization’s ability to react to changes and offset cash flow issues by closely tracking budgets against actuals. Keeping tabs on the overall financial progress of your business is easier too. With Finance and Operations, you can create your own key performance indicators that allow you to better monitor margins across departments, product lines, or discrete customer groups. Customizable tags can be placed on customers, individual items, expenses, and other items, so you can track spending and automatically generate reports to find out where your funds are going.
The app can oversee numerous companies in the same database, on the same subscription license, at no extra cost. Consolidated intercompany reports can even be generated on multiple entities in multiple-currencies, helping you track transactions between your business units.
Finance and Operations’ cash flow forecasting feature lets you visualize the short-term stability of your finances, generating predictions based on data from your general ledger, purchasing, sales and services, fixed assets, and even live budgets.
Dynamics 365 Business Central
Dynamics 365 Business Central is the suite’s flagship ERP for small-to-midsize organizations of roughly 50-250 staff. Unlike Finance and Operations, which is licensed alongside other standalone ERP, and if required, CRM apps, Business Central is designed to be more of a one-stop-shop for smaller businesses who don’t need such extensive capabilities.
Although like all Dynamics 365 apps, Business Central can be synced up with other programs in the suite, Business Central gives companies a little bit of everything, including finance, operations, supply chain, CRM and project management. There’s no user limit for Business Central, so companies of all sizes can utilize its features.
Hailed as the next step up from entry-level business accounting software, Business Central boasts a wide range of financial management capabilities at the core of its functionality. As a one-stop platform for small-to-medium businesses to manage all their operations, the app features you’d expect from a smart, modern ERP, like managing payables and receivables, overseeing cash flows, preparing VAT reports, and performing year and period closes.
With Business Central’s general ledger, you can quickly set up and start posting to chart of accounts, general journals, and recurring journals. Users can also easily keep track of fixed assets and related transactions like acquisitions, depreciations, write-downs, appreciations, and disposals. The app can also help manage inventory costs as well as operational and departmental budgets in real-time, and surface useful, actionable data quickly with customizable reports and dashboards.
Business Central makes auditing more intuitive too. The app can automatically assign audit trails and descriptions to every transaction, and users can further bolster their paper trails by defining transactional reason codes to be added to ledger entries. It also supports the amalgamation of financial data from multiple companies, and the integration and automatic reconciliation of bank statements, so that businesses can get a centralized view of all their brands and holdings for financial analysis.
Companies using more than one bank account can create and manage accounts within Business Central, helping to cater for diverse business needs across a multitude of currencies. The system supports multiple currencies throughout, including in payables and receivables, general ledger reports, and resource and inventory items, and automatically updates currency exchange rates.
The app also aims to help users get better results from their business intelligence by allowing them to set up “dimensions”, which are essentially tags that can be assigned to entries so that they can be easily categorized and tracked.
Conclusion:
Due to its software productivity and multi-functionality, Microsoft office has always been popular for small business owners. It’s all-inclusive and compatible with most types of hardware and software. When it comes to desktop software, Microsoft Office is actually a great solution since it allows you to install the entire suite at a relatively low price. But what happens when you run a business which requires a bigger piece of software? Say, a small business accounting application, for example? If you’re from the USA or Canada, then this probably applies to you since neither country uses the Euro as their currency.