Best small business accounting software – 2018 reviews electricity basics


There are a growing number of accounting software applications for today’s small business. Some are designed for specific industries (e.g., construction or professional services), while others are tailored for specific business sizes, with varying levels of functionality. In addition, buyers will need to consider what deployment model and integration method is most cost-effective for their company.

Given all this, it can be tricky for small businesses to identify the right accounting software for their needs. We developed this guide to help buyers understand exactly what these products offer, so they can select the solution that is the best fit.

Thousands of small businesses contact us every year looking for help selecting the accounting solution best suited to them. Some of these buyers are just getting started, while others are looking to replace an outdated or problematic system.

There are several different applications for buyers to choose from, which can be purchased either as a standalone application or along with other related applications, as part of an integrated software suite (more on this below). Make sure the system you purchase covers all the functionality you’re going to need.

Reporting applications allow businesses to export data from their accounting system in a structured manner that communicates financial history as well as financial projections. Some may include compliance-related functionality for government or industry audits (e.g., in banking and financial services).

Budgeting applications allow small businesses to model potential financial outcomes and to compare actual profit and loss to planned budgets, which helps with decision-making about workforce, spending and growth. Some systems have dashboards that display information visually.

Fixed asset applications focus on tracking assets that aren’t easily converted to cash: For a small business, assets will typically be “tangible,” such as land, buildings or equipment. These applications calculate the value of such assets over time, allowing for depreciation due to wear and tear.

Most small businesses will want to consider cloud-based accounting solutions. Because these systems are hosted online by the vendor, they eliminate the need for you to have a dedicated IT team for managing and maintaining your own server. Conversely, an “on-premise” deployment means the software is hosted locally, on your company’s own servers (which you are responsible for maintaining).

Choosing a Web-based system drastically reduces upfront investment and installation costs. In addition, these systems typically offer monthly subscription pricing, which makes them scale well for fast-growing companies that need to add additional user licenses or features down the road. On-premise systems, on the other hand, come with a steeper, one-time fee to use the software in perpetuity.

At present, some businesses may still see savings with an on-premise system, especially if they already have the necessary hardware to host the software on-site. While on-premise solutions usually require purchasing an expensive perpetual license up front, this may still be the cheaper option if you use the same system over an extended period of time. However, keep in mind that with on-premise solutions, you might also pay additionally for upgrades, customizations and maintenance.

Our recent report shows that the great majority of accounting buyers are undetermined about whether they want Web-based or on-premise deployment. Among those with a preference, buyers are split approximately 50-50. According to experts, these preferences may soon change, as Web-based accounting programs become more widely available and as on-premise options are no longer supported. This change will likely mirror preferences in other software markets, where Web-based systems are more popular and have surpassed preferences for on-premise. Key Considerations for Small Businesses

With so many options and feature sets to choose from, selecting the right accounting solution can quickly become an overwhelming task. To narrow things down, here are three key factors for small businesses to keep in mind while evaluating different products:

Best-of-breed vs. integrated suite options. Because accounting encompasses so many functions, from fund accounting to billing and invoicing, many entry-level products are actually “best-of-breed” solutions. This means they focus on only one of the core applications listed in the table above. “Integrated suites,” meaning solutions combining multiple applications in one software package (often billed as “professional” or “enterprise” editions), have much greater functionality, but are also are much more expensive.

Automation capabilities. Many small businesses we speak with say they’re replacing their accounting system in order to reduce the inaccuracies that come with manual entry and to automate more of their processes. Small businesses should pay particular attention to the degree of automation that a system provides as they evaluate accounting software for small business. If your company is growing, it’s especially important to track everything in a system that can verify entries for accuracy and automate recurring functions to ensure that nothing slips through the cracks.

Integration with other programs. While small businesses may not have as many integration requirements as larger companies, your accounting software’s ability to sync with other programs could still be a factor. Consider whether your desired accounting system can integrate with any of your company’s current stand-alone applications—for example, if you have a payroll system designed to support small businesses, or a retail point-of-sale (POS) system that will need to integrate with restaurant accounting software functionality.

Moreover, integration with banking institutions and credit cards can make it much easier to keep track of your company financials in real-time. Accounting software can sync with your online accounts automatically, so you don’t have to enter transaction information manually.