Before cloud-based accounting solutions, accounting and bookkeeping was anything but fun. You had to keep everything in Excel spreadsheets, send recurring invoices manually, keep receipts in a shoebox and cram all of your bookkeeping records in a cabinet. And we haven’t even mentioned the monotone data processing and the total madness tax season brings.
All of these nightmares vanished with the arrival of online accounting software, which can be managed by people who have no or minimal expertise in the accounting field. You will see that they are designed to make the accounting process as hassle-free as possible, giving you the option to partially or even fully automate the most boring part of running a business. And if that’s not convincing enough, with cloud accounting software you can: integrate your existing solutions into the new one, learn basic accounting with ease and reduce costs by paying cost-friendly prices for this true powerhouse.
What Makes Accounting Software Easy
One of the many pros of online accounting is real-time data recording: you enter data into the cloud and it automatically becomes available for later use. In fact, you only have to input data once, and the software takes care of it without any human interference.
Multi-currency, recurring/one-time invoices can be created in mere seconds from scratch, or from quotes/estimates you created earlier, and can be paid instantly by the client through an online payment system. All necessary data can be stored in their respective places (contact lists, inventory etc.), and by connecting your bank to the visual dashboard you can immediately see your cashflow and you can simply reconcile your bank transactions. With the aid of payroll you can manage the timesheet of your employees and pay them accordingly.
Most features can be accessed from iOS/Android apps, but if you need something else or you just don’t want to leave your old software, you can opt for the countless integration options and merge your legacy accounting solution with the new one to create a true powerhouse.
Best Online Accounting Software of 2020
|Editor's Choice 2020|
Best Easy to Use Accounting Software
Xero is used by over 600k SMBs and enterprises for very good reasons: it’s a simple, straightforward online solution possessing all features any business needs. You can create multi-currency invoices once or on a recurring basis, even based on your own quotes and estimates, and allow your clients to pay you instantly with the online payment option. The software records you expenses (with receipts), stores your products/services in the inventory, and even files your 1099s when tax season is coming. You can also enjoy a fully integrated payroll service, allowing you to pay your employees with direct deposit or by check. Xero has an iOS/Android app that substitutes the desktop version so you can perform some of the most important tasks you may want to perform while on the go. The software integrates with over 400 third-party apps and offers you 24/7 customer support. Xero is available in three different pricing packages, all complete with a 30-day free trial.
Although it’s mostly intended for SMBs, FreshBooks is a great asset for every type of business. The software has the most essential accounting features, most of which are available from a full-on iOS/Android app. Invoicing is ridiculously simple: you can change the document’s language and currency, you can add discounts, taxes, dates, reminders, late fees, and the fast payment option, and when a payment is due or completed, you get notified thereof. The projects section allows you to better organize your tasks and even provides you file sharing and chat-like communication with contributors who can track their time with the built-in time tracker. As for expenses, they can be categorized and visually displayed on your superbly informative dashboard, while business reports are made automatically for further convenience. FreshBooks is available in 3 cost-friendly pricing plans, all providing the option of a 30-day free trial.
DIY Small Business Accounting
Online accounting solutions are indeed intended for making the accounting process completely hassle-free, but to use them in an effective manner, you need to take into consideration various factors and learn a bit of accounting yourself. It’s a good start to think about what features you will need and choose a solution accordingly. Then you have to set up schedules: you have to decide which tasks should be done on a daily basis and which one can be done at the beginning/end of the month.
Once the above factors are settled, accounting will become much easier for you. However, if you still think you need some help with your books, you have plenty of ways to learn the basics. Almost all accounting solution providers have detailed knowledge bases explaining the software’s features and their related accounting practices, but you can also watch tutorial videos or attend webinars. Furthermore, you can always contact the customer support of the chosen accounting solution or turn to certified bookkeepers who can help you with everything, including the use of software.
Automation for Simplicity
Although cloud accounting programs sport lots of useful features, sometimes you will need something that is either lacking from the software or you have a separate solution with the more advanced version of the desired feature. This is where integrating other solutions enters into the picture: since accounting solutions offer and support an API, you can integrate various third-party apps into your system, creating the ultimate powerhouse for almost full-on automation.
A feature that is usually missing from accounting software is payroll, but thanks to the seamless cooperation between companies like Gusto and accounting solution providers, you can easily calculate the salary of your employees, pay them instantly and have these records stored in your online bookkeeping. You can also integrate various time tracking programs to be able to bill by the hour, and expense management tools to turn receipts into invoices and record them in your system. And we haven’t even mentioned that payment processors like PayPal, ecommerce systems like Shopify, and CRMs like Capsule CRM can also join forces with your accounting software.