Success of a small business largely depends on how they manage their finances. According to Joyce Berryman, Survey of the Literature, poor and careless financial management is the leading cause of small business failure. Online accounting software can be an excellent tool for small businesses to manage their finances, so that they can focus more on business growth.

Benefits of Online Accounting Software for Small Businesses:

  • Software saves time, since manual processes are automated and the work is finished more quickly.
  • Computerized accounting minimizes the chance of errors as automatic calculations and a centralized set of financial data provides a consistent basis to work off of.
  • Accounting software helps business owners make better decisions through instant reporting and analysis. Insights like these enable you to visualize the big picture. For example, you can predict your cash needs now and in future.
  • Automated financial software also allows small business owners to organize and keep complete records of financial data such as invoices and credits.

Features to Look for in Excellent Accounting Software

  • It creates professional-looking invoices with your logo and branding.
  • Since billing can be tough, accounting software should organize all the information and give you efficient billing solutions to handle your business cash flow.
  • Managing Payroll is another ordeal for small business owners. Most accounting software packages have a built-in payroll system, or has this option available as an add-on. An integrated payroll system helps you to pay your employees properly and on time while taking care of necessary tax issues.
  • If you are travelling most of the time, you should consider an accounting software package with incorporated mobile apps. It helps you access the system from any location and check financial matters.
  • Accounting software enables you to manage expense claims, ensures you don’t miss out on anything you could make a claim on.

The Best Accounting Software for Small Businesses 2016

Intuit QuickBooks Online It is considered the best accounting software for small businesses. Why? Read below.

  • QuickBooks provides the best and most affordable paid packages and services for different types of businesses. The cheapest plan costs just $9.99 per month, and provides key features that small businesses need in order to manage their finances.
  • As a software application, QuickBooks is easy to use and add new information to. It conveniently connects bank accounts and credit cards right from the dashboard, as well as critical data for operations, such as vendor information, new staff and new customers.
  • QuickBooks is synonymous with automating tasks, making accounting more efficient and less stressful.
  • As an “accountant approved” application, this software has all the features accountants need for effective small business management.

 Xero Accounting Considered the second best accounting software for small businesses, Xero has multiple features that appeal to small business owners.

  • Known as the “QuickBooks alternative,” Xero is one of the easiest accounting software to learn and is highly affordable.
  • Loaded with the same fundamental capabilities as QuickBooks, Xero offers more value for your money. For example, it starts at just $9 per month and contains features like 1099s, billing, expense reports and unlimited users, all which cost extra on QuickBooks.
  • Xero also provides cost-effective payroll solutions for $30 a month, which would cost around $75 per month on QuickBooks, depending on the number of users and employees.

FreshBooks This is the best accounting mobile app for small businesses. The features that make FreshBooks competitive are:

  • It is affordable and easy to use.
  • FreshBooks easily creates professional-looking invoices.
  • It helps manage and track expenses from anywhere, while also categorizing them and linking amounts to relevant clients and vendors.
  • FreshBooks also supports several newer payment modes, such as PayPal, Stripe and Authorize.Net.