It’s not easy to select accounting software. There are hundreds of products on the market, but being spoiled for choice isn’t always a good thing. In fact, it can lead to analysis paralysis.
Shopping for software is especially hard if small business owners do it on their own. Even if you know which software features you need most, learning which tools offer the best features can feel like a maze. That’s why bookkeepers play such a crucial role.
What does a small business bookkeeper do?
A bookkeeper for a small business manages the business’ financial data. Their job is to collect source documents (invoices, cash receipts, etc.) that record the business’ financial transactions. Then, they upload and store those documents within accounting software. Finally, bookkeepers reconcile accounts to confirm their accuracy. This is often achieved by directly working with the small business owner within the accounting software they’ve selected.
Since bookkeepers have accounting expertise, small business owners seek their guidance in other ways as well. It’s not uncommon for small business bookkeepers to guide entrepreneurs through the software buying process. In some cases, entrepreneurs delegate the whole task to their bookkeepers. They’d rather outsource to an expert than make a mistake.
In light of their vast knowledge, GetApp asked small business bookkeepers to debunk some accounting software myths. Their answers – which were shared with us anonymously via Google Surveys and are denoted in quotations – tell you what they wish they could tell clients. Consider this “myths vs. fact” face-off our part in breaking the fake news cycle!
Myth: “One accounting software will solve all my business problems.”
Fact: No software solution will do everything you want.
When shopping for your small business’ first accounting software, it’s tempting to choose the most comprehensive tool. That can be a wise choice depending on how vast your small business accounting needs are. For example, QuickBooks Online is widely used and largely loved by GetApp readers due to its huge set of features and hundreds of integrations with other cloud-based apps.
But here’s the hard truth: Most software users only use a small subset of a product’s features. And if you select software that’s way more comprehensive than what you need, you could end up overpaying.
Instead of just jumping for the obvious choice, make a list of the most important tasks you need your new accounting software to accomplish. Then, use guides like GetApp’s quarterly Category Leaders ranking to learn which products offer the best versions of the features you need. This process will save you time and money while keeping your expectations in check:
“I don’t think any software fulfills all needs for any business, nor do I think they should try to. I think the third-party app environment of both [QuickBooks Online] and Xero takes the right approach by letting those developers provide added functions as needed by a particular business.”
Myth: “Using accounting software means I don’t need a small business bookkeeper.”
Fact: Accounting software can’t replace people.
This is a sore spot for several small business bookkeepers that we spoke with. More than one shared their frustration at the widespread myth that using accounting software negates the need for bookkeepers.
This couldn’t be further from the truth. In fact, it’s common for accounting apps to highlight ease of collaboration as one of their key features. The end goal is for small business owners to work directly with their bookkeepers within the same software.
Bookkeepers themselves add enormous business value. The right bookkeeper will help your small business grow more quickly. That’s because they can keep your financial house in order while you invest in achieving your goals. But bookkeepers can feel like they’re a hard sell for some small business owners:
“What’s my biggest challenge helping small business clients onboard new accounting software? Their willingness to pay for professional help. Due to intense marketing, they think they’re capable of doing their own accounting and [QuickBooks Online] is presented as a DIY option. I can’t solve it until they figure out on their own that it’s not true. Once they’ve floundered and made a mess and realize they need help, then I can help. Until they reach that realization, they don’t think they need our help.”
Clearly, the onus isn’t just on small business owners. Small business bookkeepers feel that some accounting software products use misleading marketing tactics. They told GetApp that they wish these software vendors would be more upfront about how important it is for bookkeepers to part of the small business accounting process:
“Most cloud accounting software advertising implies that business owners can run it on their own. They enter a receipt and voila – they end up with correct [financials]. That is very much not the case. I would love it if vendors would stop trying to imply that SMBs can [do it themselves] – they need someone who knows what they are doing.”
Myth: “Price is most important when shopping for accounting software.”
Fact: Accounting software with time-saving features is the best investment.
We know why price is top-of-mind when shopping for software. Small business owners don’t have corporate cards with sky-high limits. While some small business owners choose the biggest software option, others go in the opposite direction. They’re so focused on price above all else that they won’t consider options beyond their budgets – even if other solutions would be best in the long run.
Instead, small business bookkeepers stress that entrepreneurs should prioritize software that can save them the most time. As Sarah Penn of Mayflower Consulting says:
“If you’re an accountant looking at software, the amount of time and effort that you are going to save by picking the right package is way, way more valuable than picking the one that’s $20 cheaper per portfolio.”
Penn also reminds readers that the cost of switching software isn’t small. If you buy accounting software that’s cheap in the short term, you might be forced to pay up when you need a more robust solution in the future. That’s why small business bookkeepers are happy to help their clients find the right choice – but they wish their clients would put more effort into their own market research first:
“[Clients] usually come to me already with software or knowing what they want or what they want to switch to. But they often have no reasonable basis for what they choose. For most of my clients, I absorb the cost of software, because I think that is the least relevant criterion on which to base a decision.”
Myth: “Accounting software automates everything.”
Fact: Accounting automation doesn’t downplay the need for (human) customer support.
Widespread fear exists that emerging technologies like artificial intelligence (AI) will get so good at manual tasks that they’ll erase the need to hire humans. This fear isn’t totally unfounded: Some accounting apps are adding these technologies to their products today. And if new features like automated invoicing get too good, will that erase the need for small business bookkeepers?
Not according to anyone we spoke with. James Solomons – Xero’s Head of Accounting in Australia –told GetApp that in light of automation, human support will be more crucial than ever.
Likewise, accounting software vendors can’t skimp on customer service. It’s true that aspects of this industry are now automated. But surveys show that consumers still want the option to speak with a human – and so do small business bookkeepers:
“Yes, [small business owners have] a unique need. Customer support (LIVE, not chat, not [a robot]) is imperative. When something isn’t working between the apps, the ‘he said, she said’ needs to stop and a solution arrived at immediately.”
Myth: “Using accounting software means my financial records will sort themselves.”
Fact: You still need to keep your documents in order.
Accounting software should simplify your work. Features like bank reconciliation let users import things like daily bank and credit card transactions into the tool. Some accounting apps even let you snap photos of receipts before uploading them.
But for all its bells and whistles, accounting software isn’t an excuse for bad bookkeeping. If invoices, cash receipts, and other documents aren’t up to date, your accounting software won’t be much help. This is one reason why investing in a small business bookkeeper is so important. They can manage the financials for you – if you give them the chance to do it:
“Getting them to keep current on the books [is my biggest challenge]. Generally, once it falls behind, it turns into a clean-up project (for me). Once that happens, I try to talk to them about letting me keep the books current so they can do what they do best – run their business. Some resist this until they fall behind again, and then they usually let me handle the books. Once they see the benefit of not having to worry about the bookkeeping, it is not usually an issue again.”
Are you a small business bookkeeper? Share your advice in the comments!