Going Independent: Adding Up the Pros and Cons ; COLIN EXLEY and JOHN WILLCOCK Test-Drive the Best Accounting Software
Colin Exley and John Willcock, The Independent (London, England)
Less than a third of UK small to medium-sized enterprises (SMEs) use bookkeeping software. We tested four accounting packages specifically designed for SMEs. All four packages contained the following functions as standard: sales ledger, purchase ledger, cash book and nominal ledger.
What should it do?
Essentially the software that you will buy does the same thing as that used by much larger companies: it automates bookkeeping. Most accounting software is presented as modules, each performing a set of related accounting functions. As the complexity of the business increases, more modules are needed. The starting point for most packages are four basic elements:
1. Cash book - a record of all receipts and payments in cash and those going through your bank account.
2. Sales ledger - invoices issued to clients and amounts due from them.
3. Purchase ledger - invoices received from suppliers and amounts due to them.
4. Nominal ledger - brings everything together into the basic accounts from which the balance sheet and profit and loss are drawn up.
The whole point of the software is to produce clear, accurate reports of your business's performance. Ask to see examples of these reports and find out how easily the software handles their production.
Establish a clear idea of your needs. The first question is whether you really need any software at all. Write down your needs in the form of a checklist which can be used to compare features of different products. If you use an accountant already, see if they have any favourite software.
Do your transactions involve other currencies? How does the system handle this? The software reviewed is generic and should suit most types of business, but remember that specialist packages may have been developed for your industry, for instance hotels and guest houses, where accounting may be integrated with a reservation system.
Don't pick a system purely on the basis of price. If you can't get what you want from your software, it is money badly spent. Remember, once you have been using a particular system for a while it can be a complex exercise to switch to different software, so it is important to make the right choice at the beginning.
This package is designed for non-accountants and relies heavily on graphics to keep things simple. The cheapest version would suit a business with five to 10 people.
Price: pounds 129.99 including VAT
There is a more advanced "Professional" version costing pounds 249.99 that can be integrated with Microsoft Excel and lets you prepare sales orders and estimates. You can also buy a payroll service for pounds 89 a year.
A third, new package allows your accountant to access your accounts remotely without having to travel to your offices each time. This is called QuickBooks Premier Accountant and retails at pounds 399.95.
The package includes a credit card facility. This allows you to take credit card payments from customers at a cost of four per cent plus 30p per transaction. There is no set-up fee or regular charge and no minimum amount, which makes it attractive for small users compared to the high street banks' services.
An easy-to-use package from this innovative company.
MICROSOFT MONEY 2002: PERSONAL AND BUSINESS
Product also includes extensive personal financial management features.
Price: approximately pounds 70
This version of this software for controlling and recording personal finance and investments has been extended to enable the accounts of a small business to be maintained as well.
As with most recent Microsoft products there is a strong integration with Web services such as business news and information. Inevitably, these features link to Microsoft-owned Web services - hardly the only places on the internet. …