Small Business Accounting Software

Small Business Finance Software

Using bookkeeping software to automate the accounting tasks of your business will save you hours compared to manual accounting, as well as help avoid errors in calculations. Storing your information electronically in one location, backed up online regularly and password-protected, rather than in paper format, helps keeps your information secure and confidential. We discuss a few of the main functions and benefits of bookkeeping programs below.


Accounting software will record all your company's financial information in one place, in various different program modules (General Ledger, Accounts Receivables, Accounts Payable, Inventory, Payroll). Most software is based on the traditional double-entry accounting system with this function hidden or running in the background, making it easier for non-accounting experts to use. You simply enter your transactions or use the screen "forms" (e.g. check writing, invoicing) but you can also if you wish view the background debit and credit journal entries, the "double entry" accounting.

Your chosen program should have setup assistants or wizards to guide you through entering all your company financial information, including your chart of accounts. Normally interview-type questions tailor the application for your business needs. The entire process shouldn't take more than 30 minutes.

You should also be able to import your financial information from Excel and from the top accounting programs (Microsoft Money Office Accounting, Quicken and QuickBooks, Peachtree, MYOB). Once this is all done and you have begun entering transactions into the program, you should see an overview or summary of your daily business operations in one screen. For example, QuickBooks has the Company Snapshot; Peachtree has the Business Status Center.


Your program should include a contact management feature where you can store the contact details for all your customers, vendors, employees and personal contacts. It should contain customer and vendor transaction history and a place to add notes such as a customer's payment terms and credit limit.


Using the online banking feature of your software will save you time when recording transactions and avoid any possible data entry errors. You will need internet access. Most bank and credit card companies work with the popular accounting programs to offer this service, however do verify if they will charge you any fees first. Check with your bank and credit card company about setup - you may be subject to application approval. Your bank will either support direct download of transactions into your program, or you will have to periodically download a file from your bank's website, containing your transactions, and then import that file into your program.

You should set up a separate account in the program for each bank and credit card account you have. You can then download your transactions, adding them or matching them to those you may have already entered manually into the account registers. You need to reconcile your program accounts to your bank accounts from time to time - investigate any discrepancies as they arise.


Managing your Accounts Payable with accounting software helps you easily keep track of what you owe to your vendors, bill payment due dates, and records of how much you have paid in the past. If you pay your bills as soon as you receive them, you can create and print checks. If you prefer to pay at a later time, you can enter your bill details into the program and set bill due date reminders so you pay your bills on time and don't incur any late charges. Keeping track of all your outgoings helps you better analyze and forecast your cashflow.

Many programs will allow you to make electronic bill payments - but check the fees for these first. Some programs will provide check design capabilities - letting you personalize your checks with background images, photos and company logos.


You can use small business finance software to track job expenses and revenue for individual jobs or projects to see which are profitable for you and which are not. You can also enter job budgets and monitor progress; as well as creating quotes and estimates for your customers.


If you bill your time and expenses to your clients, you would benefit from accounting programs which contain a time tracking and billing module. Check if the system provides multiple billing rates per employee, daily & weekly timesheets and time counters. Reports which show unbilled time & expenses can help you quickly & easily transfer unbilled time to invoices with a few clicks.

You can enter your employees time yourself or if you prefer your employees to enter their own time online (from any computer with an internet connection), you may need a separate subscription service. It's now also possible with some programs for employees to submit their time through Microsoft Outlook with an automatic download to your accounting software.

Employee time tracked can be used to calculate your payroll.


An Accounts Receivables module will track your unpaid customer invoices as well as keep track of all customer transactions and aging reports. You should be able to customize your invoices & statements to some degree, adding company logos, colors and moving fields or adding additional invoice text describing charges. It's also possible now to email customers invoices, saving time and postal charges.

If you'd like to accept payments by debit and credit card you will need to subscribe to a merchant account. You'll then be able to accept payment by phone, fax, online or in person (for a fee).


Bookkeeping programs offer basic or advanced inventory - consider first what you'll need. With basic inventory features you'll be able to track inventory levels and value, set minimum re-order points (with reminders) and easily create purchase orders.

More advanced features may allow you to build assembly items and track these together; track inventory by details (size, color, weight, tax type, etc); or set different pricing level calculations (e.g. to allow for discounts/sales).


Choose from in-house or full service solutions. You can track employee overtime, vacation & sick leave; process employee paychecks, deductions &tax payments; and process payroll tax forms.

Pay your employees by printing paychecks directly from your software. If you wish to offer direct deposit, there will be additional charges.

E-filing quarterly and year-end payroll tax forms, and making tax payments electronically also incur additional charges.


Accounting software uses all the financial information you have entered into the program and provides several different types of reports and graphs (e.g. profit & loss, sales, cashflow, account balances, net worth) to enable you to monitor your business. You may find hundreds of customizable reports available and should also be able to create your own from scratch if needed. It's handy if these allow you to drill down to the individual transaction level. Look for reports that export to Excel with formatting and formulas intact.

Tax reports help organize your data for tax time, and may export directly to tax programs for easy completion of tax returns. Or you can provide these to your professional tax preparer.


It's useful if your financial software contains an audit trail feature as this will record any changes made to your transactions and alert you to any suspicious transactions or common accounting mistakes (e.g. duplicate transactions).

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