Bookkeeping Software

Choosing Your Bookkeeping Software

When starting a business you quickly realise that keeping your finances in order is very important. You may well have considered hiring an accountant to help you make the right financial decisions for your business. However, this is not always a feasible option, particularly for new start-ups when it is important to keep overheads as low as possible. There are some advantages of using specialist accounting software rather than hiring an accountant professional, which are:

1. Affordability

In the long run, you may well save money by hiring an accountant as they will know the best ways to produce your end of year accounts. Of course this is an expensive process though, and accountancy software is a much more viable option. The right software with the best add-ons tailored to your business will make sure that you are fully compliant and are recording everything you need to be.

2. Time-Saving

Accountants always get busy periods throughout the year when all their clients want their tax returns to be completed at the same time. By using bookkeeping software you will be able to complete the tasks you need at a time that suits you.

3. Higher Accuracy

There is always an element of human error with accountancy. If you opt for a top accountancy firm they will have hundreds of clients on their books and may not see you as a priority. Choosing software means that your accounts will be more accurate as they can connect directly with your bank feeds, making things like reconciling your accounts much easier.

4. One place for everything

Often you will be passed to different departments within an accounting firm depending on what you require. However, software systems often provide these additional services so you can run your payroll and check your VAT status all within the same place.

5. The Cost of Accounting Software

This really does vary depending on the add-ons that you require to help run your business. Nowadays, the best accounting software companies offer cloud-based software as opposed to traditional software licences which means you just pay a monthly fee. There are often various price plan options, ranging from £20 a month to £70 a month. More bespoke solutions can add a lot more to the price tag, but they often contain advanced features including project tracking and billing, team functions, inventory management and purchase ordering.

Most companies offer free trials of their accounting software which gives you the opportunity to test it out for yourself before making the commitment. These will often have limited features though so are not a long-term solution.

What Features Should You Look For?

It can be difficult to know what features you will need from your accounting software until you get stuck into using it. There are a few things from a usability point of view that are worth having a think about:

1. Multi-user Access

Most accounting software will allow you to have multiple users on one account, which is useful if you have a business partner or accountant who also needs control over the finances. You can usually limit the level of access for each user too, so your employees could track their time using it, but not be able to see any of the detailed financial information.

2. Multi-Business Support

If you own more than one business it might be worth looking for accounting software that allows you to add several businesses under one account, at no extra cost. Otherwise it could become expensive setting up separate accounts for each business.

3. Cloud-Based & Mobile Access

Most accounting software is cloud-based which means you can access your account anywhere, and at any time. So even if you are abroad on holiday you can still check your accounts. Many also provide mobile apps where you can quickly add expense receipts whilst you are on the go.

4. Basic Features

To start with, you will require basic accounting functions such as invoicing, income and expense tracking, financial report generation and customer/supplier management. If you are a business that sells a high number of products you will also need software to track your inventory and manage the purchase side of things. On the other hand, a service-based business will require software that allows you to track time and invoice billable hours.

5. Time-Saving Automation

Every business owner wants to save time where possible. Some accounting software can carry out some of the repetitive tasks for you, such as sending recurring invoices or chase-up emails to customers who have not paid their invoices on time. Others suggest transaction matches to help save you time when it comes to reconciling your accounts.

6. Tax Preparation

It is always a good idea to choose accounting software that has features such as automatic tax calculations and tax reporting. This will save both you and your accountant time, so when it comes to your end of year taxes there won’t be a mad panic to get everything organised in time.

7. Third-Party Integrations

Accounting software usually integrates with other common programs and services too, allowing you to manage several things from one dashboard. Popular integrations include POS systems, CRM systems, payment processing, inventory management, eCommerce and email marketing tools.

Final Considerations

When you have narrowed down your choices to two or three, it is always a good idea to sign up for the free trials and get a real feel of how each system works. That is the only way you are really going to be able to tell if the accounting software has all the features that you need. Check how good the customer service is too - you never know when you might need some additional support. There are a few other questions you might want to think about too:

• Does the software offer customised solutions to fit the needs of your business? These customisations can save hours of your time by helping build a system unique to your business.
• How many employees and clients can the software accommodate and does this feed into your CRM, or import from your CRM? Again all time saving, and planning in advance about the whole business and how systems will integrate.
• How is the data backed up? Can it be restored immediately? If it's cloud based this ones obvious, I would always advise anyone to back up their customer accounts and data somewhere safe as this is the core of your business.
• What security measures are in place to keep both the business and customers’ data safe? You no doubt have a privacy policy, have you followed the steps do you understand GDPR and how you may be liable for a data breach?
• Are there any additional setup or cloud storage fees? Cloud software allows unlimited usually, but worth checking were any limitations exist.

If you would like any further information on some of the most popular accounting software solutions, get in touch with B2B Accountancy today and we will be happy to help advise you.