When you're choosing accounting and billing software for your business, you should take advantage of the free trial period so you can make sure the software is easy to use and has all the features you need. Spending time with the software upfront helps you feel confident that you've made the best choice and ensures that you aren't stuck with a program that's confusing to use or doesn't have the functionality you need. Here are some features to look for and compare as you choose accounting software.
Bank feed. This feature allows you to connect to your business bank and credit card accounts to receive a daily update of your transactions. This saves you the time it would take to manually upload statements into the system, and it gives you a daily, rather than monthly, overview of your accounts. This also assists with reconciliation, allowing you to make it a small daily task rather than a monthly ordeal.
Dashboard. When you log into your account, you're greeted by a dashboard that shows you an overview of your account activity and key metrics, such as cash flow, profit and loss, account balances, expenses and sales. Some allow you to customize what you see first by rearranging the information.
Online invoicing. If your business sends invoices, being able to email them and accept online payments helps you get paid faster. Some software vendors integrate with third-party payment processors; others require you to use their in-house processing service.
Recurring invoices. With this feature, you can schedule the system to automatically generate and send invoices for recurring charges, such as subscriptions. You can choose how frequently the invoices are sent – daily, weekly, monthly or annually – and indicate whether there's an end date to the billing.
Automatic payment reminders. This feature helps you remind customers about upcoming and past-due payments. Some have sample email text that you can use as is or that you can customize. You can then choose when you want the reminders to be sent. Some programs also give you the option of sending thank-you emails to customers after you receive their payments.
Bank reconciliation. Smart reconciliation tools identify potential matches between your bank transactions and the bills and invoices that you've entered into the accounting software, saving you the hours it would take to sift through records for this information. You can then approve or deny the suggested matches. The best products we reviewed suggest potential matches as you reconcile your accounts, and a few also include a reconciliation feature on their mobile apps.
Financial reporting. Every accounting program can generate reports, but some are more basic than others, and some require you to subscribe to a higher plan for advanced reporting. If there are specific reports you need, you'll want to check and make sure they're included with the program and plan you choose.
Mobile apps. Not every accounting and invoicing program comes with mobile apps, but the best ones do. There is, however, quite a bit of variance in app capabilities. Some can only capture receipts for expense tracking; several also allow you to create and send invoices, and others have almost every feature as the web-based software.
Integrations. Being able to connect the accounting software to the other business programs you use saves you the time it would take to manually transfer data from one system to another. Payroll, payment processing, POS systems and CRM software are examples of popular types of integrations you may want to look for.
Track billable hours. If you're a consultant or your business is an agency that bills its clients by the hour, you want accounting software that allows you to track and bill your time, or that integrates with the time-tracking program you already use.
Manage inventory. If you have a retail or distribution business, you want accounting software that tracks inventory and helps with purchase ordering. You may need to subscribe to a top-tier plan to get this feature. If you need advanced inventory, you want to look for software that integrates with an inventory management system.
Project-based billing. Firms, freelancers and consultants that work with clients on projects or jobs should look for accounting software that helps them track projects tasks and budgets. The software should allow you to invoice customers for tracked time and rebill them for project expenses.
Multiple business support: Several programs we reviewed allow you to add more than one business to your account, though some companies charge extra for this convenience.