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Which Accounting Software is Best for Small Business

Accounting can be a confusing task especially for your business. In this video, Ivan Ivankovich, CFO of docstoc.com, shares his opinion about doing your own books and debunks the myth that it's overly complicated.

Transcribed article based on the video above.

Before making a decision on what kind of accounting software you should use, you should ask, should I be using accounting software? A lot of my clients ask, do I use accounting software or do I use something else? My answer is yes, use accounting software, there’s a variety of tools out there that you can use to manage your accounting.

The first tool is an online accounting software, Quickbooks being one of them. They offer an online product that is web based, where you log in and your accounting data is hosted by Quickbooks and it provides all the functionality that you as a business owner would need to manage your finances and your accounting. It is a monthly subscription that, I guess over time could add up, it’s not too expensive initially; it’s about thirty dollars a month. The challenge with using the online version is as your business grows there is limited functionality in terms of more sophisticated accounting and tracking inventory and using purchase orders, online versions typically don’t do a good job in those areas.

There’s a desktop version, which provides functionality, more sophisticated functionality if you will, it is a license fee that you pay, approximately $200-$400 for the Quickbooks desktop version, it can really take you from zero revenue to fifty million in revenue. I have clients that are generating about fifty million in revenue and are using the Quickbooks desktop version, it really does provide a lot of functionality and it is really easy to use and easy to learn to use.

The third is a spreadsheet, you know, that’s the old fashioned way of tracking your checkbook register of cash collected and checks being written. Those are the three different tools for accounting. I’d recommend either the online version or the desktop version depending on your comfort level. If you are always accessible to the Internet and are comfortable logging in and using a web based tool, great. But you should use an accounting software, either the online version or the desktop version would be great for fully understanding how your business is doing and tracking your revenue and expenses.

Ivan Ivanjovich is the CFO of Docstoc. You can read more of his posts here on Docstoc at the DocstocTV profile page.

Ivan Ivanjovich is the CFO of Docstoc. You can read more of his posts here on Docstoc at the DocstocTV profile page.