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The top 5 accounting softwares for SMB’s – a critical comparison

If you’re reading this, you are one of the millennial entrepreneurs thinking of starting a business to escape the ‘median lifestyle’. There are various aspects which you need to consider without having the FCA crawling up your back. One could argue that the most critical and challenging aspect of running a business is ensuring your accounting records are squeaky clean – accurate, accessible and manageable. During the pivotal stage of opening your business, the last thing you want to worry about are boring administrative tasks such as book-keeping. Luckily for you, in this age, you find yourself overwhelmed by solutions accessible to you at your fingertips. This article will feature the best accounting software’s currently available on the market for start-up individuals such as yourself.

1. QuickBooks

QuickBooks has become the go-to accounting software for start-up businesses in 2019. You as a business owner are now able to easily sync your bank account, credit cards as well as various other payee-platforms such as PayPal and automatically capture all of your transactions on one user-friendly platform. Amongst its abundance of features, QB lets you generate and track invoices, generate expenditure reports and manage taxes – all in ONE place. QB is seen as both a cloud-based and on-premise solution, allowing the users to access the platform online via PC, MAC, Smartphone and Tablet. A stand out benefit of this service is certainly the user gaining access to a wide range of online-tutorials and resources that aim to equip any beginner with the tools to manage their books like a ‘pro’. Those of you that upgrade to ‘QB Plus’ also have the added bonus of 24/7 customer support. However, like any platform currently on the market, QB does come with its drawbacks. A number of users have complained about QB’s lack of functionality and flexibility when inserting transactions from bank feeds. Some users even stated that they had to visit a specific transaction twice to get the data and coding in the correct order. Nonetheless, this platform’s benefits far outweigh the negatives and if you are looking for an accounting platform for your business, then you should certainly consider QuickBooks. Prices start at £12 P/M.

2. FreshBooks

FreshBooks, offers start-ups with a ‘fresh’ outlook on modern bookkeeping. However, unlike QB, FreshBooks’ main audience compromises of freelancers. If you find yourself in this category, then you will LOVE what this platform can accomplish for day-to-day needs. The fundamental reason for this is that this platform comes with the easiest-to-use app currently on the market. The app allows you to send and track invoices, track payments, capture receipts, manage projects and accept payments incurred- all from your fingertips. Moreover, another feature that instantly grabs your attention is the dashboard; even with no prior knowledge, you can master this platform without breaking a sweat. However, for UK based start-ups the website offers no clear direction of pricing, although for a rough estimate, the US version starts at $15 P/M.

3. GoDaddy Bookkeeping

GoDaddy, one of the largest domain name registration companies in the world, offers a mountain of services, including a cloud-based bookkeeping service for small businesses. This platform enables you to really visualize your transactions, maintaining an accurate profit and loss chart on the homepage. Comparably to QB and FB, this platform allows you to sync multiple bank cards, credit cards and PayPal to a ‘motherboard’ that automatically tracks and displays your transactions. Everything from invoice management (with recurring invoices) to integrated payments via stripe or PayPal is accounted for. On the flipside, this platform has been criticized for not having some advanced features when compared to the likes of QB and FB. Prices start at £8 P/M.

4. XERO

If you are confident that your business will grow, Xero, will grow with it. This powerful web-based accounting platform is tailored not only for professionals, but also for small business websites and offers plans and features that grow as your business does. Xero enables you to send invoices, view bank transactions, manage payroll, manage payroll if you have employees and even create multi-currency accounts all from within the app. It’s ‘almost holistic’ interface is embedded with an array of reporting tools- most of which you probably won’t exploit, UNTIL you reach your desired goals of business utilization/growth. Conversely, like all the cloud-based accounting platforms before it, Xero has been reported to face a number of issues. If you’re Irish, for example, and you have to-date, experienced what’s commonly referred to as “the luck of the Irish” … you may be out of luck. This platform has revealed a lack of customer support in Ireland, with the majority of Irish banks not supporting its online packages. Starter packages begin at £10 P/M.

5. Wave

Last, but certainly not least, Wave. Unlike the platforms before it, Wave offers a free accounting software for small businesses. It allows for you to effortlessly manage all your finances by synchronizing your bank accounts with the app. The app then tracks transactions made and presents them in a user-friendly way. Furthermore, it allows you to send automatic, manual and recurring invoices whilst capturing receipts enabling you to keep track of your business anywhere in the world. However, as basic as this all seems, when it gets down to the pricing, things get complicated. Even though the basic software is free to use, the transaction fees for credit card transactions stand at 2.9% + 25p per transaction with an addition of 1% per AHC transfer transaction. Overall, if your business grows significantly, but so will your expenses. Free BUT beware of hidden fees.

As you may have already grasped, this blog aimed to provide you with some basic information regarding web-based accounting software’s, should you ever wish to open up your business or are in the process of doing so. Each platform provides you, the user, with an array of benefits as well as drawbacks, nonetheless, which you go for it is dependent on your personality and usability preferences – because at the end of the day, a single platform will never appeal to everyone.

 – Daniel Khanna

Tuesday October 29th, 2019

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The AAT Accounting qualification provides the perfect pathway to a successful career in finance and accountancy. We are one of the UK’s leading AAT providers and offer students a unique mix of practical expertise with vital theoretical teaching. Whether you’re a school-leaver, re-training or returning to work, our courses offer the ideal route into accountancy.

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