Software for small business finance is an essential organizational tool. Small business finance software gives companies an affordable way to create invoices, keep track of payments and organize finances with a single computer program. A company's human resources department can better manage company, employee and customer financial information. This is also a good tool for running discrepancies or audits.

Small business finance software providers offer many different features for a company's payroll and human resources departments, among other groups. Some programs are also customizable to your business or industry. Here are some features companies should look for when working with small business finance software:

1. Customization options that tailor the software to your needs.

2. Whether the small business finance software is compatible with other programs.

3. The security available to keep your information safe.

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Choose a supplier of small business finance software that offers security features

Small businesses are just as susceptible to fraud and identity theft as individuals, so companies that use small business software should find out what the program can do to keep their information secure. Some security features ensure number accuracy during audits, tools that prevent data tampering, and features that can detect suspicious transactions.

I recommend: Peachtree software by Sage provides many security features for its small business software. Resources for Entrepreneurs has an article about the very real possibility of business identity theft, should your accounting software for small businesses be hacked. Small businesses that are concerned about security could also install a program like PC Security Tweaker, as reviewed by Bright Hub. This is an easy way to protect your finance software by adding an extra layer of security.

Explore finance software for small business that also provides marketing solutions

Working with small business finance software can be even more convenient and affordable when the program includes customer resources management (CRM) features and other marketing tools. Web-based small business finance software often includes CRM and marketing components that can help your organize customer information, order management and marketing campaigns. This provides an all-in-one financial management system for your company.

I recommend: NetSuite provides a web-based program for small business finances that includes tools for marketing online, traditional accounting functions, and customer management. Everest Software provides Everest Advanced, an all-in-one small business package for finance, CRM and eCommerce management.

Consider a customizable small business finance software program

Small biz finance software can come straight out of the box and work well for most small businesses. But if you own a growing small business and already have software tools in place, a customizable program may be the best choice. Some programs let you tailor as you go, while other companies offer customization services. Providers of small business finance software customization services often send a software rep to evaluate your company's needs.

I recommend: Intuit makes Quickbooks Pro 2009, a small business finance program with customizable features. The program can handle reporting for specific industries, data tracking and employee information. Or, you can start from scratch and license your own software by working with a company like Programs 101, which can design small business finance software. Small Business Resource provides articles and information on implementing small business software.

Providers of small business finance software are numerous. Some are simple freeware and others are highly complex systems for nearly all accounting needs. It is, therefore, important to purchase the small business financial software that fits your needs. Failure to thoroughly research your purchase may result in acquiring software that's too complex to use or too simple to process the legally required data.

Here are major categories to consider when shopping for software for small business finance:

1. Freeware is software that requires no payment and comes with complete functionality. This software usually provides only basic functionality.

2. Small business financial software options include applications similar to the ones used for home finances.

3. Small business finance software providers sell complex systems intended for major corporations. These are often customizable, usually by the vendor.

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Use freeware providers of small business finance software

Freeware software is appropriate for small companies with one or only a handful of employees. Such software has the advantage of being free, but can be severely limited in capabilities. Choose with care; the work you enter may not be transferable to a more sophisticated application software for small business finance.

I recommend: AceMoney Lite provides a single account for small business finance and is freeware application software. Although it doesn't allow multiple accounts management, if your business is small enough, you may only require one account. Money Manager Ex, a user friendly small business finance software program, helps organize finances and tracks your money flow.

Buy Quicken or Microsoft, dominant professional small business finance software providers

Both Intuit and Microsoft want the middle market of small biz finance software. They provide software targeted to small and moderate sized companies. The packages provide tracking, billing and sophisticated reporting.

I recommend: QuickBooks, the granddaddy small business finance software tool, increases price based on the levels of sophistication. Microsoft Money, on the other hand, comes in only one version, Microsoft Money Plus Home & Business, and works well for small businesses.

Purchase top-level software for small business finance to handle complex business requirements

The top tier of small business finance software systems can cost hundreds of dollars per user. Often such software comes with considerable technical support, complex options and in-house customization services. Only purchase such software if your business requires equally complex financial tracking.

I recommend: Peachtree, a top financial software company, sells the Quantum package, which is a multi-user environment with many analysis tools and reports, plus access to customer support and product upgrades within 12 months of purchase. Oracle for Financial Services delivers comprehensive, pre-integrated business applications. The software comes in versions for companies in banking, insurance and capital markets.

Tips & Tactics

Helpful advice for making the most of this Guide

• •  Unless you have a compelling business requirement, it might be best to keep small business finance software data entry to one person. This assures a consistent style and minimal access to sensitive data.

Small business finance software is programs used to manage your company’s accounts. Small business financial software can complete many of your accounting tasks, such as invoicing, tracking sales, manage tax records and more.

When you look at small business finance software advice and ratings, you can see what other professionals are saying about particular programs. If a small business finance software system has numerous negative reviews, you can know to steer clear of that program.

1. Select a small business finance software program. View several types of small biz finance software until you settle on a few versions to review.

2. Read reviews of finance software for small business. Rely on Internet articles and journal pieces to review software for small business finance.

3. Get ratings from small business finance software providers. A small business finance software provider will likely allow users to post ratings and reviews of different programs.

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Read editor reviews of small business financial software

Different online publications have editorial reviews of different small business finance programs. Editorial reviews will talk about key features as well as likely give each program a starred rating.

I recommend: CNET has listings of the most popular small business financial software programs. Select each particular program in order to read both editorial and user reviews. SoftSea.com is a very easy to navigate site with small business finance software program reviews. If you like the ratings, you can download many of the selections as freeware.

View ratings from independent reviewers of small business finance software

Consumer and business software review sites will usually allow users to search their product database and look for the best rated finance software programs. Also, browse sites that allow users to give their opinion on software.

I recommend: TopTenReviews is a very helpful site for those looking for small business finance software advice and ratings. They rank programs on different areas, like ease of use, features and support help. You can purchase the software directly from the site. ConsumerSearch gives sources for their ratings and reviews of small business financial software.

Get advice on usage of small business finance software programs

Once you know the ratings and reviews of software for small business finance, you can look for helpful advice on using the program. The advice may include troubleshooting techniques, how to and basic operation guidance.

I recommend: Small Business Finance Tips has a helpful article on both choosing and using your selected small business finance software by making a comparison between Quicken and QuickBooks. You can check for other archived articles that give advice on small biz finance software. The Microsoft Small Business site has an informative site that can help you with their financial software programs. Select the Learning Center link for more advice on Microsoft Small Business finance software.

Small business finance software helps a business keep its financial books in order. Each application will use a certain type of accounting system and keep records of types of expenses and income.

Some finance software works with software that processes a federal or state tax return for a given tax year. It may determine the net worth or equity of a business. Some software has a sunset policy that encourages users to upgrade to the latest version.

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Double entry system

A double entry system, also referred to as double entry accounting, is an accounting method where each transaction has a debit and a credit, so the overall balance remains equal. Many business finance software applications use this system.

I recommend: Find a glossary of accounting terms including double entry system at Saral Accounts, a division of Relyon Softech.

Envelope budgeting system

Envelope budgeting system works on the theory of having a series of envelopes for each expense and only spending money from those envelopes, as an effort to keep expenses in line with income.

I recommend: Find an explanation of envelope budgeting system as part of the description of a finance software application at FinanceSoftwareStore.com, a division of the Miaow-Miaow Network.

Sunset policy

A sunset policy is a policy of some companies that produce business finance software, whereby after a certain date, it will no longer support a given version of the product and certain features may cease to work. Users of software with a sunset policy need to upgrade before the date, if they want to continue to use those features.

I recommend: Find a discussion of software sunset policies at Randsco.

Types of expenses

Financial software categorizes each expense based on what type of expense it is. Fixed expenses stay the same over time, such as loan or insurance payments; variable expenses include costs for inventory, utilities and transportation; discretionary expenses are those that are not strictly necessary to running the business, such as entertainment expenses or charitable contributions.

I recommend: Read a discussion of the various types of expenses, with examples of each, at InvestorGuide.com.

Equity or net worth

Equity, also referred to as net worth, is the value you get when you compute the value of the assets of a business and then subtract the value of its liabilities.

I recommend: Find the definition of equity, as well as a long list of other accounting terms, at Accountz.

Tax year

A tax year is the calendar year in which a tax return covers. There may be limitations to the amount of contributions or deductions that you can make in a given tax year.

I recommend: Find mention of a tax year in the glossary at IRA.com, which discusses limitations to contributions to an IRA within a single tax year.