Inquiry Monday: What Bookkeeping Software Should I Use?

This is an interesting question that depends on the needs of a business and the computer skills of the accountant, most likely you! When many companies begin selling, it is fairly common for the you, the owner (I personally have done this), to keep receipts, invoices and other accounting documents in a folder or box. As business picks up, it becomes increasingly difficult to accurately keep track of sales and inventory. When tax time rolls around, a major freak-out will most likely take place as you scramble to locate and organize all the paperwork. It will be so much better if you never go that route and instead, implement the use of some sort of computer software. While there are numerous programs on the market, I will share just a few of my favorites.

If you have little to no money to invest in additional software, Microsoft Excel can be effective in keeping track of sales and inventory. Create a sheet with columns and rows containing customer names, dates and totals of sales and taxes collected. Input formulas that will automatically add columns and list the total. Monthly or quarterly worksheets will make tax filing quick and accurate by grouping specific sales periods. Microsoft Excel is much easier to use and most business owners probably have the software already installed on their computers. If not, it isn’t very expensive to purchase. However, there are many limitations. The worksheets will only contain information you input manually. There is no inventory management which automatically updates when you make a sale, nor is there a database that can tie customer information to invoices. It is also more time consuming to track business expenses.

If you are looking for something that will provide what Microsoft Excel is lacking, and can’t afford to hire an accountant, there are several accounting software options. Peachtree and Quickbooks by Intuit are two very popular programs used by many small business owners. Both have many different versions, depending on the size and needs of your business, and both offer free basic versions and trials of more advanced versions. The basic programs are easy to set up. However, if your business needs are more complicated, there are specialists who can set up the software for you and enter in all your data. My advice is to download a free version or trial and play around in it. Some of you may have more difficulty in using the software, and it is better to find this out before you invest a boat load of money.

Whatever your method, accurate bookkeeping is essential and a necessity when running your own business. If you are organized from the beginning, it will makes things much easier when filing tax returns, and heaven forbid, if you are ever audited, you can print out all the information you need to make that visit to the IRS a pleasant experience (if that is possible)!