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I am not an IT nor Accountant ... therefore I only have to say ... it depends on what you want to do with the program ...... and how much you want to spend
Quick-books is nice for a small business and easy to operate
Excel can be utilized and programmed/rather make templates for your businesses needs.
AS400, Encompex and GP - I have seen utilized in the manufacturing sector and these programs usually have accounting programs, however I can not tell you how easy these programs works, since I did not have access to it
To help answer that, let me first briefly talk about the evolution of personal computing. The very first computers used by both consumers and businesses were desktop computers, and they were the mainstay of personal computing for many years. Next came laptops, then came the smartphone, shortly followed by the tablet. These devices have expanded what you can do with a computer and changed how you use one. As the devices became smaller and with the advent of the Internet, work suddenly became mobile, allowing knowledge workers to ply their trades from anywhere, at any time.
Accounting software has undergone this same shift. From pen and paper, to spreadsheets, to desktop accounting software. And now there’s the cloud and the term online accounting or cloud accounting software. A new problem that has arisen is that a lot of software related to small business accounting falls under the umbrella category of online accounting software. However, just like there are many types of computing devices (desktop, laptop, tablet, smartphone), there are many types of online accounting software as well. Some are better suited for certain functions and types of businesses than others.
Online Accounting Software TypesMy task today will be to help you navigate the different types of online accounting software so that you can choose which one is the best fit for yourself or your clients.
As I see it, the six main types of online accounting software are:
Most online accounting software has certain “core” features such as posting to the general ledger. Each product, though, can have additional capabilities, such as inventory, expense management, project management, payment processing, payroll, and so on. Part of the big difficulty in navigating the complicated waters of software for your business’ accounting needs, is that there is a lot of crossover in functionality between these different products. There’s also a huge difference between users, from the big picture accountants, to the detail oriented bookkeepers, to the get-this-done-so-I-can-do-something-else small business owners. Lastly, what works well for an owner-operated business probably won’t work so well for the small business with25 employees.
So, I’ll start off describing personal software and work my way up to enterprise software.
Be aware: The examples of software are just that, only examples, they aren’t a comprehensive list of all the software of that type. Additionally, some software could fall into a couple types. There is no hard and fast rule for types and examples, they’re there simply as guidelines to aid in your software making decision.
PersonalExamples:
Ideally suited for:
This really isn’t business software, but it’s in here to help make the distinction that it isn’t. Look, you’re reading this on an accounting software consultant’s blog, so there’s we’re not really going to recommend this type of software for business use. However, we do recognize that this is where some small business owners start, either because they’re familiar with the software from having used it for their personal finances or because it seems similar enough to business accounting software.
The pros are that it makes finances fairly simple. Enter an expense, enter some income. There’s not much in the way of assets, equity and liabilities. If you’re doing a very small “hobby” business, with only a few entries a month, maybe it’s something you can get away with doing, as long as you are very organized as to what’s business and what’s not. But really, it’s not recommended.
The cons are that this is not double-entry accounting software, which is another way of saying is that it’s not software you can use to enter debits and credits in a general ledger, which is a fundamental requirement of accounting software. So a bookkeeper or accountant would probably never use this type of software.
ExpenseExamples:
Ideally suited for:
The goal of this software is to capture expenses.
The pros are that these are very specialized on the expense side of your business financials. The software is generally simple and easy to use, yet has many handy features that micro-business or small business accounting software may not have, like being able to capture receipts, pay bills, and track time.
The cons are that they are not full featured accounting software. Don’t think that you’ll be using this type of software to do your books. Rather, it’s a component, a piece – or as we’d like to say – a chunk, of what’s needed.
Look for expense software that can be integrated or exported to fully functional accounting software and remember that this software is only one piece of your small businesses accounting needs.
InvoicingExamples:
Ideally suited for:
The interesting thing about invoicing software, is that it’s generally more broadly focused than expense software. They can handle expenses as well as invoicing, but of course the specialty is invoices. This software can be quite handy for service-based business that deal with projects, where they have to track time and expenses in order to bill their clients.
The pros are that they make invoicing easy and have advanced functionality that the micro-business and small business accounting software sometimes don’t have.
The cons are that they are not true accounting software, despite being able to track expenses. They are usually missing the concept of accrual accounting, control over the chart of accounts, account reconciliation, and the ability to post directly to the general ledger.
Look for income software that can be integrated or exported to fully functional accounting software and remember that this software is only one piece of your small businesses accounting needs.
Micro-businessExamples:
Ideally suited for:
This is kind of a new software type, wedging itself between personal software and small business accounting software. The goal of this software is ease-of-use while still being fully functional accounting software.
The pros is that the software is generally friendly to the average small business owner. Things are simplified and the functionality is limited to the core needs of the small business owner.
The cons are that it’s simplicity and narrow scope of functionality means that as a business grows, what used to be simple and easy can start becoming difficult and inefficient. There’s also use cases where a small business has specialized needs, like inventory management, integration with a POS system, or re-billing of expenses, where this type of software really isn’t always up to those tasks.
The software in this space is rapidly evolving and features that weren’t there yesterday may be there tomorrow. One of the big differentiating factors between micro-business and small business accounting software is that the small business software has more focus on their integrations partners (i.e. third-party add-ons). This means that if you’re looking to use your accounting software with other software, you’re most likely, but not always, better off going with small business accounting software.
Small BusinessExamples:
Ideally suited for:
This software, while sometimes being advertised to the small business owner as easy-to-use or the solution to all their business needs, is really more a tool to be used by accountants or bookkeepers to work with small businesses. The complexity starts to become enough that it’s best used with the guidance of an accountant or bookkeeper, even if they are setting it up, doing some initial training, and then doing a yearly review and adjustment of the books.
The pros of this software are that they really are a great collaboration tools between accountants, bookkeepers, and their clients. Not only that, with the integrations, this software starts to become the hub of several business activities, like customer relationship management (CRM), project management, and e-commerce. Never before has the flow of data between these business areas been greater and more integrated. This means less data-entry, less errors, and better tools for smarter business decisions.
The cons of small business accounting software are that they are not quite there yet in terms of the pros mentioned above. Integrations can fail, in certain areas they are just not as powerful as their desktop counterparts, and the reporting and nuanced little details are not always there.
EnterpriseExamples:
Ideally suited for:
This software is geared towards the bigger small businesses. The business will most likely be generating millions in revenue to warrant software at this level. To get started with this type of software you usually have to contact a sales rep who will give you a personalized demo and custom quotation.
The pros of this software are it’s power. These can be tailored to your business’ exact needs and plug in with your other software systems. This type of software also allows for the greatest control over who in the company can do what, and can divide the software into silos, meaning that if you have an employee using it to issue invoices, they can have their own interface that just shows them invoicing, hiding the rest of the software from them.
The cons are the cost and complexity. These take time to set up and learn. If you’re a small business that’s growing out of the small business software, going enterprise can be quite a leap. There’s very little middle ground between the types of software.
Wrap-up
There is clearly an overlap between all the categories and this article is not meant to be a solid black and white breakdown of each software type. The types I feel have the most crossover are the micro-business and small business accounting software. The former is more focused on the small business owner (micro-business), whereas the latter on the bookkeepers and accountants. As both types of software develop we’ll see how they will continue to push up against each other for that market of companies who are5-10 employees in size. I think the integrations (add-ons) are going to be a huge differentiator and those products that can develop an ecosystem around their platform will be better able to find continued success.
I also feel that there’s this uncomfortable gap between small business and enterprise accounting software. It’s such a huge jump to go from under a hundred dollars a month for your accounting software to what’s most likely to be $1,000+ a month. That’s a big leap. Will the small business accounting software scale up to meet this gap, or will the enterprise software come down?
I hope this guide was useful in giving you a frame of reference, for what’s out there and that sorting the software into types will make the task of choosing the right accounting software for a business just a bit easier
Thanks for invitation, and I am really sorry for my late, because I were had a lot of work.
agree with answers ..........................................
TALLY IS THE ONE OF THE BEST ACCOUNTING SOFTWARE
I agree with the expert answers,
