8 Factors to Consider When Choosing Accounting Software

Maria Tanski-Phillips
Posted by Maria Tanski-Phillips on Apr 28, 2021 10:43:16 AM

Whether you’re looking for accounting software for your firm or wanting to team up with a provider to help manage your clients’ books, you need to know what to look for in accounting software. When you’re on the hunt for software, consider some oh-so-important factors and ask yourself a few questions before committing.

Accounting software factors to consider

As an accountant, you need your and your clients’ books to be accurate. But aside from accuracy, there are a few other factors you need to consider while shopping for accounting software. If you’re looking for a reliable software solution, make sure you ask questions about the following factors:

  • Customer service reputation
  • Stability
  • Software type (e.g., cloud-based)
  • Features
  • Cost
  • Reports
  • Accessibility
  • Security

1. What’s the accounting provider’s customer service reputation?

A huge part of reliable accounting software is customer service. As an accountant, if you have questions, you need answers fast. You don’t want to be bounced around from representative to representative when reaching out to support.

Look for accounting software that provides excellent customer service and support. You can research each software option’s customer support and expertise by checking out online reviews (good and bad) and reading customer testimonials. If you know someone who currently uses the software, you can ask for their feedback.

You may also want to do some research to find out the software provider’s:

  • Support hours
  • Time zone
  • Average wait time
  • Communication channels (e.g., email, phone call, chat, etc.)
  • Customer service location (e.g., USA-based)

You should also find out if the provider requires you to pay additional fees for different levels of customer support.

2. How stable is the company?

Another factor you want to consider while searching for accounting software is the stability of the company.

When looking for a solid company, try to find out:

  • How long the accounting software company has been in business
  • If the company is agile enough to handle unplanned situations easily (looking at you, COVID-19)
  • The company’s reputation (e.g., look at reviews, BBB, etc.)
  • How often they’re releasing new features and enhancements

The more stable a company is, the better. And, the more comfortable you may feel trusting them with your and your clients’ accounting and financial information.

3. Is the software cloud-based or desktop?

Ah, the great debate: Cloud-based vs. desktop accounting software. When you’re choosing accounting software, this is one factor you don’t want to ignore.

While choosing accounting software, determine if a desktop or cloud-based software would better fit your and your clients’ needs. Weigh the pros and cons of each type of software to get started.

Cloud accounting software is 100% online and accessed through an internet browser. Accounting data is stored in the cloud, which means you don’t have to stress about losing important information if your computer crashes. Not to mention, you don’t have to worry about downloading or updating anything on your computer or device. Instead, the software automatically backs up information and updates for you. Cloud accounting can also make it easy for you to access your client’s books and reports whenever you need them.

With desktop accounting software, you need to install and store the software on your computer and can only access it on the device you install it on. Unlike cloud-based accounting software, you have to do manual updates with desktop software and you are responsible for backing up important accounting information and files.

4. What kinds of features does the software have?

When selecting a software, find one that fits your or your clients’ needs. This might mean choosing one software over another based on the features it offers.

To help narrow down the perfect software, make a list of what must-have features an accounting software needs to have. Some features you may need include:

  • Vendor payments and reports
  • Ability to track expenses and income
  • Credit card payments
  • Ability to invoice customers
  • Bank reconciliation
  • Bank deposit and withdrawal tracking
  • Estimates
  • Recurring invoices
  • Invoice payment reminders
  • Multiple login capability
  • Bank transaction import

When looking at features, also consider the ones you’ll need as your firm and clients grow. The last thing you want to do is be stuck with software that doesn’t fit your needs as you evolve and expand.

5. How much does the software cost?

Another factor to consider is cost. Generally, the more features you have, the more the accounting software will cost you. And in some cases, you may be limited on how much you can use a certain feature.

Do a price comparison to see what each potential accounting software will cost you and/or your clients. Look into hidden costs, such as fees or additional costs for add-ons. And, find out whether or not the software has month-to-month pricing or if you need to pay an annual fee.

Be sure to also look into which features are limited and if any have unlimited use. For example, you may be able to find software that allows you to send unlimited invoices.

Some accounting software providers have special pricing for accountants and their clients. If you’re planning on using the software for multiple clients, check to see if the potential providers have a partner program. With a partner program, you may be able to get special deals, like lower pricing and free software for your firm.

Depending on the software, you may be able to get a free trial or demo to test out the software before you commit, too.

6. What are the reports like?

Reporting is a huge part of accounting, especially if you’re planning on setting up software for your clients and having them provide you reports.

When you’re on the hunt for accounting software, take a look-see at what kind of reporting they offer. And, find out how easy the reports are to access, print, share with others, etc. You might also want to check to see if they have comparison reporting or drill down reporting.

Here are a few reports you may need:

7. How accessible is the software?

Is the software accessible while you’re on the go? From multiple devices? Ask yourself these types of questions to determine how accessible the accounting software will be.

As an accountant (and an advisor to busy business owners), you need software that is flexible and can be easily accessed anytime, anywhere.

When choosing a software, look at the following to help determine accessibility:

  • If the software is cloud-based vs. desktop
  • How you can access the software (e.g., on your phone)
  • If the software has an app or responsive design for mobile
  • How easy it is for your clients to access

8. Is the accounting software secure?

Keeping your and/or your clients’ information secure should be one of your biggest priorities. To keep vital information safe, look for software that is transparent and serious about security.

When choosing software, find out what security measures the provider takes to protect your and your clients’ information. And, ask if they’ve had any security breaches or issues in the past.

Depending on which type of software you go with (e.g., cloud or desktop), you may need to take security precautions of your own to protect data. For example, if you use desktop software, it’s typically a good idea to use protections, such as firewalls, strong passwords, and security software.

If you plan on using online accounting software, the software company will likely have certain precautions already in place to help protect information that’s in the cloud (e.g., encryption and two-factor authentication).

Topics: Cloud Accounting

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