Factors to keep in mind before selecting an Accounting Software

• Posted on Jun 13, 2017
• |
• By Dhruv

If you run a business, you need an accounting software to record all your income and expenses. Purchasing an accounting software is the first and foremost thing you buy when you start your business. However, most business owners buy one only when they need to pay taxes or apply for loans.

Now, the question arises in the mind that, how to choose a right accounting software for your business? To answer this question is quite confusing. Consider the following factors to your notice according to your needs and it will help you in selecting the right software.

Factors to keep in Mind:

 ⇒ Online or Offline:

The first question that strick your mind is – Whether to go for an online software or a desktop based offline software?

Nowadays, most of the businesses are adopting cloud-based software because of their added advantages over traditional offline software. However, some businesses like retail stores require speed and not always connected to the internet. For them, offline POS (Point Of Sale) systems are the best bet.

Advantages of Cloud-Based Accounting Software:

– No Installation needed. Just signup and start entering your transactions.
– Online software is always up to date. You don’t have to worry about any upgrades.
– Can be accessed from any internet-enabled device at any point in time
– Backup and maintenance is taken care of by cloud-based accounting software providers, which is cost saving for you.
– Data is synchronized across all your offices.
– Online software can be integrated with other cloud-based applications.

When you should buy an offline or desktop based software:

– When you have your own retail store and you deal with hundreds of invoices over the counter.
– You do not have internet connectivity at your business location.

You should go for online accounting software, as it has an added advantage of providing you with financial data anywhere and at any time.

⇒ Data Security:

You should avoid this point if you are looking for an offline accounting software. And if you are thinking about going for an online accounting software, then data security is the most important factor to check.

Important things to check:

– Gather some intel about how they store the application data. Mostly all the information is given on their website. Here is an example. Amazon and Rackspace are one of the trusted cloud hosting service providers.

– Check whether the services are using HTTPS connection. It is easy to check this, you just have to check the URL in the address bar. HTTPS protocol ensures that the data transferred from your computer to software company’s servers is encrypted and can not be viewed by hackers.

⇒ User Interface:

Most of the business owners do not have any accounting background. Even if you have a dedicated accountant who would be using the application, as an owner you should be able to log in and browse the things. Also, it should be easy enough for your employees to learn the software. Investment in training is a cost and should be avoided.

If the software is stuffed with every possible feature you can imagine, it will become difficult to use for your team. So, one should select a software which has a simple user interface and which is not stuffed with unnecessary features. 

⇒ Exit Option:

Imagine if the company you are buying from shuts down its operations or you discover lot of bugs few months after the purchase. Saving yourself from such situations, you have to see that the accounting software you are choosing has a data export facility.

You should be able to export ledger or other transactions at least in the form of excel as most other softwares will accept excel file for the import.

⇒ Hidden Cost:

Many times it happens that you buy a software at a lower cost, but they charge you for “add-ons” or for any “maintenance fee”. So before planning to buy a software, check it beforehand if there is any hidden cost there or not.

⇒ After Sales services:

This is the most important but most ignored thing while selecting an accounting software. No matter how good or easy the software is, you will need support at some point. And if you have nobody to talk to when you are stuck, your entire investment will go in vain.

Lack of support is also one of the reasons why some accounting softwares are cheap. Obviously, support cost is not included in the offering. You should avoid such products at any cost.

Considering this factors before deciding to buy an accounting software will help you immensely.

• Posted on Jun 13, 2017
• |
• By Dhruv
• |
• 0 Comments