backpacker tax

What to know about your small business accounting software?

Making sure that your small business has the appropriate accounting software is essential.

One of the primary reasons why businesses fail is because they do not have a reliable bookkeeping system in place.

You have the option of keeping your books manually (through the use of accounting books), electronically (through the use of spreadsheets), or via the use of accounting software. Accounting software is the most time- and labour-effective option, so use it unless you plan to educate yourself on various bookkeeping procedures.

What exactly is meant by the term “accounting software for small businesses”?

Accounting software designed specifically for small firms can monitor incoming and outgoing financial activities, as well as financial statements and cash flow.

This type of software is known as small business accounting software. Historically, small firms have kept track of their financial information using manual methods, such as spreadsheets.

However, these manual methods are labour-intensive and result in less reliable data. In addition, spreadsheets lack the features of a specific application when it comes to automation and notification of changes.

Users of accounting software for small businesses no longer have to manually enter each transaction data into a spreadsheet they’ve created on their own or generate new spreadsheets. They instead get the flexibility of interfacing with third-party tools such as point-of-sale software to automatically input data, which is a significant advantage.

In addition to that, these tools can produce customised invoices, provide notifications following the completion of particular financial transactions or milestones, and provide an overview of the budget for the company.

Do you need help with your bookkeeping? Bookkept is a trusted accounting and bookkeeping company in Australia. We perform cheap and quick tax returns for individuals. You can give us a call on (03) 8568 3606 or email us on [email protected].

In light of all of this, it can be challenging for smaller firms to locate the accounting software that is best suited to meet their requirements.

This guide was designed by us to assist buyers in comprehending precisely what these items provide, allowing them to choose the answer that is the most suitable for their needs.

How the Tools Used in Accounting Operate

As a business owner, accounting is probably not high on your list of favourite things to do. Accounting may be challenging, and it is essential that it be completed accurately.

Therefore, the companies that produce accounting software for small businesses have put a lot of effort into making the interface as user-friendly and, well, nice as is humanly feasible.

When it comes to this particular task, several programmes, such as Intuit QuickBooks Online and Zoho Books, have shown to be more successful than others.

If you have ever used online productivity software, you should not have any trouble grasping the structure of these products.

By providing toolbars and many other navigation tools, they all organise the information of their websites into logical modules.

Activities related to sales, purchasing, inventory management, reporting, and payroll are all bundled together.

There is always a link labelled “Settings” that, when clicked, will lead you to a screen where you may configure your preferences for the entire programme.

These include the tasks you need to complete during setup as well as the settings that you may occasionally need to adjust, such as limiting access for extra users to particular locations.

A real-time overview of the financial information you need to see often is provided on the homepage dashboard of a tool.

This overview may include charts comparing income and expenses, account balances, and invoices and bills that require quick attention.

There are frequent connections that take you to other parts of the tool where you can perform the desired activity.

You navigate each tool using conventions that are usual for the web, and you enter data using those conventions. You are going to see a lot of buttons and arrows, drop-down lists, and menus as you progress through the process.

Colour is occasionally utilised to signal-related information, and careful consideration was given to the selection of visuals and fonts in order to make the tools look as appealing to the eye as feasible.

Important factors to take into account when selecting the most suitable accounting software

Choosing the best accounting system may rapidly become a challenging and difficult undertaking because there are so many different alternatives and feature sets from which to choose. The following is a list of some of the most important characteristics that accounting software should have:

Accounting Software Designed for Less Complex Organizations


If you run your firm as a sole proprietorship or as a freelancer, it’s likely that you won’t require all of the capabilities that are included in full-featured accounting software for small businesses.

If you are in the service industry, you will likely want to monitor your online bank and credit card accounts, record your income and expenses, possibly issue bills, and monitor the amount of time you spend working. Perhaps you need to keep track of your miles.

You might want some assistance calculating the amount of income tax that you are required to pay every three months, and you definitely want mobile access to your financial information.

There are a variety of tools that can perform all of these functions in some combination. They are simple to use, and inexpensive (in the case of Wave, it’s completely free), but they may provide more functionality than you require, which may cause you to feel overwhelmed.

FreshBooks is the recipient of our Editors’ Choice award for this year in this category. This wonderfully crafted tool got its start as a straightforward software for managing online invoices. Since that time, it has expanded its capability to include more features such as basic time tracking, project tracking, expenditure management, the creation of estimates and proposals, and reporting.

However, FreshBooks is missing some functionality that are offered by competing solutions. It does not assist with the quarterly estimated taxes, unlike Intuit QuickBooks Self-Employed and GoDaddy Bookkeeping.

It is not a genuine double-entry accounting system like Wave or Sunrise, and it does not have its own integrated app for handling payroll as Wave does.

Wave does not include a real-time mileage tracker like that offered by Intuit QuickBooks Self-Employed, and it does not automate as many operations as some competing solutions do.

Accounting Software Tailored to Your Company’s Requirements

Whether you need one of these entry-level financial management tools or your business is complex enough that you need to start with one of the small business accounting tools, we think you’ll find that this batch of tools offers enough variety that you can find the right fit for your company among the available options. If you have any questions or would like more information about any of these tools, please feel free to contact us.

While you are considering your financial situation, you may also find it helpful to read our reviews of several online payroll services and tax preparation software.

Automated Financial and Accounting Software

If the focus of the past few years has been on the shift towards mobile, I predict that the focus beyond 2020 will be on automation, specifically in the form of workflows and artificial intelligence.

The finest systems have capabilities including the following:

Recurring transactions such as invoices, bills, and journal entries; Automated debtor reminders (Xero, MYOB Essentials, and ZohoBooks); (QuickBooks Online, Xero, ZohoBooks)
Auto-coding of financial transactions, which is transitioning from customer-defined norms to suggestions powered by big data and artificial intelligence (QuickBooks, MYOB, Xero)
Bill and expenditure entries can be imported as a PDF or picture and then automatically input and coded (Xero, MYOB, QuickBooks and ZohoBooks)

When it comes down to it, developing automation engines that are effective requires a significant amount of resources as well as vast datasets.

When it comes to competition, automation is the economic moat or barrier that gives global players a tremendous advantage over their local counterparts. We are already seeing large companies such as Intuit (QuickBooks), Xero, Sage, and Zoho deliver in this area, and I can only see them gaining market share at the expense of smaller competitors due to their scale, access to data, and huge human capacity to construct such things.

Setting Up Bookkeeping

After registering for an account, getting started with a small business accounting tool might take anywhere from five minutes to several hours, depending on how long your company has been in operation. Accounting software for small businesses typically comes with a free trial period and a monthly membership price to use the software. The more functions you require the tool to perform, the more time it will take to configure it (and the higher the monthly payment).

To begin, we require that you provide us with your contact information. You can submit a file that contains your company’s logo in order to have it display on the forms that are used for making purchases and sales. Some accounting software for small businesses will enquire as to whether or not you want to make use of particular functions, such as purchase orders and inventory monitoring, so that they can either activate or deactivate those services. You can also be questioned about things like the beginning of your company’s fiscal year and whether or not account numbers are utilised.

Do you want to be able to view the past transactions that you have saved in your online financial accounts (checking, credit cards, and so on)? In most cases, the small business accounting programme will import recent transactions (typically covering the previous ninety days’ worth) and add them to an online register once you have entered your username and password. Would you be interested in allowing clients to pay using debit and credit cards as well as direct bank withdrawals? You will be required to create an account with a payment processor such as Stripe or PayPal (although additional fees may apply to the former).

The Payroll System Is Integrated

Single-touch Any company that has employees is required to have a payroll system in place. If you have employees, you need a modern payroll software so that you can remain compliant while making the process as simple as possible. If you’ve decided to go into business for yourself, there’s a good chance you’ll be paying yourself a salary and will want a payroll system.

Payroll services are now included as part of the Australian QuickBooks Online offerings thanks to a partnership between QuickBooks and KeyPay. Interestingly enough, Sage has done the same thing with Sage Business Cloud Financials. On this particular front, it is likely that KeyPay, which is an embedded “best-of-breed,” will emerge victorious.

Bank Feed

This function allows the programme to establish a connection to the business bank and credit card accounts so that a daily update of the transactions may be obtained. You will not need to manually enter transactions into the system, which would save you a significant amount of time. In addition to this, it offers you a daily rather than a monthly summary of your financial accounts. The process of reconciling can be simplified with the help of a function that receives bank feeds in real time, turning it from a time-consuming monthly ordeal into a manageable daily activity.

Integration with several forms of operational software

Beyond accounting and bookkeeping systems, there’s a whole universe of software out there.

The software used for bookkeeping is not always the most important instrument used in operations these days. You absolutely need a Point of Sale system, such as Square, Vend, Kounta, or Hike, if you are in the retail or hotel business.

If you are a tradesperson, you could probably get away with just using the bookkeeping apps on their own (especially the mobile-friendly versions of QuickBooks, Xero, and Freshbooks), but you should also consider using apps that are designed specifically for tradespeople, such as ServiceM8, Tradify, NextMinute, and Simpro.

Apps like as Mindbody are necessary for yoga studios and gyms to use in order to schedule appointments and organise their class schedules. I could go on and on…

My point is that the software used for accounting and bookkeeping is not nearly as significant as the software used for the most important operations. This indicates that the most valuable aspect of the accounting software is its capacity to integrate with various operational tools, as well as the variety of possibilities that are made available as a result of such integrations.

In this respect, Xero is far and away the victor in Australia. Then came QuickBooks after it. After that, MYOB.

Zoho probably deserves a special mention because ZohoBooks is just one small part of a comprehensive suite of products the company bundles together as part of its ZohoOne offering. While the majority of these products offer integrations to best-of-breed third-party operational tools, ZohoBooks is just one of those tools. Everything from bookkeeping to reporting, inventory control to email marketing, customer relationship management to project management and beyond… The “Holistic Approach To Business Software” is how ZohoOne is presented to potential customers. When taking into account the cost, it is very outstanding.



You will be greeted by a dashboard when you log in to your account.

This dashboard will provide you with an overview of your account activities as well as critical indicators, such as cash flow, profit and loss, account balances, costs, accounts payable and receivable, and sales.

Rearranging the information in some of them gives you the ability to personalise what you see initially.

Rectification of Bank Accounts

You can save hours of time by using smart reconciliation tools instead of manually searching through your bank account for the information you need to find potential matches between the transactions in your bank account and the bills and invoices that you have entered into the accounting software.

These tools identify potential matches between your bank transactions and the bills and invoices that you have entered. After that, you will be given the option to accept or reject the proposed matches.

The most useful tools make suggestions for possible matches as you work through the process of reconciling your accounts, and some even incorporate a reconciliation feature within their mobile apps.

Management of Stock and Supplies

You need an application that not only helps you maintain your inventory but also lets you place purchase orders if you run a firm that deals in retail or distribution. It’s possible that you won’t be able to access this feature unless you upgrade to a more expensive plan. Look for software that interacts with a specialised inventory management system if you require more advanced inventory features.

Billing on a Project-Based Basis

Accounting software that aids in keeping track of a project’s activities and finances should be sought out by businesses, freelancers, and consultants who collaborate with clients on projects or jobs. You should be able to send clients invoices for monitored time as well as bill them for project expenses using the programme.


Based only on the opinions of previous customers, Rounded most likely has the greatest overall score for support satisfaction.

It is only right to point out that providing adequate customer service in software designed for use by small and micro businesses is extremely challenging to scale.

I would argue that Rounded is the company that is leading the way because they are still relatively small, has not yet encountered the scalability challenge, and its key directors are still very hands-on when it comes to assisting its customers.

QuickBooks has a good reputation for customer assistance in Australia and is likely ahead of the other BIG competitors in the market because it provides support via phone, email, and live chat. MYOB provides high-quality help through the phone and in a variety of different formats (though my experience is not as timely as QuickBooks).

Xero receives some criticism for not providing phone assistance (for example, see this thread), however, it should be noted that not everyone desires phone service in 2020, and in general, the company should be successful given its scale and its responsiveness to online concerns.


The use of accounting software ought to facilitate major streamlining of billing and accounting for business owners.

Having said that, there is no necessity for it to be very expensive.

The majority of software applications provide a variety of subscription plans that can be customised to meet the requirements of the user and their financial constraints. You have the ability to choose what you want and the price that you are willing to pay when there are several possibilities.

Pricing arrangements for accounting software normally fall into one of two categories: either perpetual licencing or a periodic subscription plan.

With a style of software licencing known as perpetual, you make a single payment and are granted unrestricted access to the programme.

Users are required to pay a recurring cost on a monthly or yearly basis in order to have access to the programme when the pricing model is a subscription.

When it comes to the cost of a subscription, you can anticipate paying anywhere from $10 per month for a fundamental beginner plan to as much as $60 per month for a more sophisticated service plan.

Other aspects, such as the number of users you have and the services to which you desire to access, will also play a role in determining the monthly cost.

Be wary of hidden fees no matter which pricing model you choose; these might include additional costs for customization options, installation or setup services, integrations, as well as maintenance or support services.

There are free software programmes available, in case your company is operating on a limited budget.

Wave, for example, is free to use but still provides many of the accounting and invoicing tools that you would find inexpensive systems.

These features include the ability to track unlimited income, sales tax, and expenses, as well as an infinite number of partners and accountants.

There are a lot of apps that will let you try them out for free, and you should definitely do that.

We strongly recommend you to take advantage of the free trials that are offered when you are selecting accounting and billing software for your company.

This will allow you to test out the various options and choose which one has the features and tools that are necessary for your company.

Spending time getting familiar with the software before making a purchase not only makes you feel more at ease with your choice, but it also decreases the risk that you will be stuck with a programme that is hard to understand or that does not have the capabilities that you require.

The Reasons Behind Our Selection of Accounting Software for Our Small Company


Before settling on our top five software solutions, we analysed the offerings of nineteen different accounting software providers that focus on developing specialised products for small businesses.

When making our decision, we took into account factors such as cost, scalability, ease of use, reputation, and accounting functionality.

The importance of a company’s reputation can be attributed to the fact that the longer a company has been in business, the greater the likelihood that any technological hiccups have been ironed out.

This, in turn, makes it more likely that an organization’s essential financial information will be reported accurately.

Scalability was the second most crucial factor to take into mind since as a company expands, so do its accounting requirements, and migrating all of that financial data to a new piece of software can be a very time-consuming process.

Because it is necessary for all users, including business owners, employees, and accountants, to have simultaneous access to and reviews of the financials, the ease of use and collaboration features have also been taken into consideration.


There are many different possibilities available to you when it comes to selecting the most suitable accounting software for your small company. Finding an accounting software solution that is tailored to the requirements of your company is an endeavour that requires both time and financial resources. Find the accounting software that is the greatest overall option for small businesses in terms of cost, versatility, and scalability, and utilise those criteria to make your selection.

Scroll to Top

Learn how we've helped businesses just like yours