Compare Accounting Software

When choosing accounting software, it’s important to find an option that’s flexible enough to grow with your business. Your needs will likely change, and you should try to avoid the hassle and expense of switching providers down the road if at all possible. Thankfully, most reputable accounting software options are built with a certain degree of ‘modularity’ in mind, meaning that you can plug in extras such as PAYE and forecasting as you need them.

There are a few key factors you should consider when choosing accounting software:

• Software type. In the past, businesses installed dedicated instances of accounting software on their own computers or servers. Today, most accounting software is offered ‘in the cloud’. This has major advantages for most businesses, including relieving you of the hassle of maintaining the software yourself. However, if you work in an industry in which security is particularly critical, you might still consider running your own dedicated installation.

• Ease of use. It’s crucial that your accounting software is intuitive enough for you to actually use it. The interface is key - is it simple to understand, and can you complete necessary tasks relatively easily? You should think about training too; if you have employees, how easy will be it be for you to explain the system to them?

• Interoperability. You may well already have other software running on which you rely, and you should consider this from the outset. For example, do you use CRM software that you want to integrate with your bookkeeping? Are you locked into a specific payment provider? Make sure all of your tools can ‘talk’ to each other. Just as importantly, if you already have an accountant or bookkeeper, make sure that you’re choosing accounting software they’re comfortable using.

• Invoicing. Most accounting packages allow you to raise invoices in the app, and many also offer tools such as automatic reminders for unpaid invoices.

• Bank reconciliation. This function is crucial for many businesses. It allows for transactions to feed automatically from your bank account to your accounting software, and for them to be matched against the corresponding records. If this is important to you, make sure that your bank is supported by the provider.

• Mobile access. A good mobile app is increasingly important for businesses and sole traders in every industry. At the very minimum, your accounting software should allow you to photograph and log receipts on the go.

• Price. The cost for accounting software can vary significantly. If you’re a small business dealing with a limited number of receipts and invoices each month, packages typically start from around £10 per month, or even less in some cases. However, don’t be tempted to scrimp on this. It’s far better in the long term to plump for a package that does everything you need in a simple and effective way than to find you’re missing a crucial tool just as you need to file a return.

• Added extras. Finally, think about any additional tools you might need as your business grows. Perhaps the most important of these is PAYE support. Even if you don’t currently have employees, it’s worth considering a package that offers PAYE so that you’re safe as your business grows. Many small firms also look for cashflow forecasting and other management reporting tools, but bear in mind that these are generally offered at an extra cost or, in some cases, through third-party ‘plugins’.

• Customer support. There are varying levels of customer support across providers. If speaking to someone at the end of a line is important to you, then make sure phone support is available as not all packages offer this as standard.