In this article, you will get to know why QuickBooks should be your choice over other free accounting software alternatives.
Small and Medium Enterprises form the backbone of the Indian economy. No doubt, small business owners play a pivotal role in creating job opportunities and bringing innovation, these firms face their own set of challenges.
Right from finding customers to getting the right people on board, almost everything is undertaken by the small business owner.
With so much to handle, business accounting and bookkeeping tends to get overlooked. Thus, in order to organize and carry their business operations smoothly, these small businesses prefer using online accounting software.
QuickBooks is a widely used cloud accounting software that enables business owners as well as Chartered Accountants to:
- track sales and expenses,
- create and send GST-Ready invoices,
- track inventory and
- generate reports
Such a powerful accounting tool helps small businesses get an overall picture of the financial health of their business. However, many small businesses consider using free accounting software alternatives over QuickBooks Online.
Now, the side hustlers as well as home based businesses might find it reasonable to manage their business operations using free accounting software alternatives.
But, they tend to ignore the exhaustive features offered by QuickBooks Online which can help them manage their business effortlessly.
In this article, we’ll compare the features and benefits of QuickBooks Vs Free Accounting Software Alternatives.
This will give you an understanding how QuickBooks offers a suite of power packed features at a modest price and why it’s worth investing in.
QuickBooks Vs Free Accounting Softwares
Following are the features where QuickBooks Online stands different from the Free Accounting Software Alternatives available.
1. Single Application
QuickBooks Online is a simple and easy to use accounting software that powers your business with a single application.
It helps the small business owners, accountants and the self-employed to create GST Invoices, keep track of money through online banking and manage inventory, staff and payroll all through a single application.
That means, you don’t need separate applications for managing various aspects of business such as sales, expenses, inventory, payroll, taxes etc.
However, this is not the case with the various free accounting software alternatives to QuickBooks.
For instance, to create and send invoices in some of the free options available, you will need a separate application to to do the same.
Thus, users find it difficult to manage their business information and hence demand a universal app encompassing all the features.
2. Third Party Integrations
QuickBooks Online has hundreds of connected apps that help small businesses manage their business operations efficiently. These range from payment apps, expense tracking apps to customer management apps, time tracking apps etc.
These third party integrations are for every business type and need ,thereby helping small business owners do a lot more to run their business easily. Thus, this saves them time, money and manpower.
Also, the small businesses can avoid manual data entry errors and manage accounts accurately.
On the other hand, the free accounting software alternatives offer limited third party apps thus making small businesses use separate applications for a variety of tasks.
For example, with no inventory tracking feature in the free accounting software alternatives, business owners will have to use a different application to undertake the same.
This means increased time and cost investment on the part of the business owner.
3. GST Ready Invoicing
QuickBooks Online smart invoicing feature fastrack invoicing and customer payment. Business owners can generate GST compliant invoices and save time otherwise put in preparing GST Invoice formats manually.
Further, with extensive customization options, business owners can create and send customized online invoices that go with their brand identity.
Thus, business owners can either use invoice templates or customize invoices using color codes, fonts, formats etc. Furthermore, they can auto schedule invoices and even add images to the invoice items.
Also, these invoices can be created and sent at any time, anywhere and from multiple devices.
However, the free QuickBooks alternatives do not offer extensive customization options. Further, they do not have built-in data fields that help you create GST compliant invoices.
For instance, you would have to manually insert details like HSN Codes or SAC Codes and GST tax rates. This would add to the complexity as well as increased time in creating tax invoices.
4. Accounting & Tax Reports
QuickBooks Online helps business owners generate a number of professional accounting reports instantly.
These include basic financial statements like Profit and Loss, Balance Sheet and Cash Flow Statement, GST Return Reports, Accounts Receivable and Payable Reports etc.
Thus, business owners can create standardized or customized accounting reports to analyze business trends. Also, they can send reports to customers and accountants without any delay via email.
As for the free alternatives to QuickBooks, the number of reports available are limited. Thus, these options lack in giving a detailed overview of various aspects of a business.
For instance, small business owners would not be able to create GST Return reports using these free accounting software alternatives as they do not offer such reports.
5. Inventory Tracking
QuickBooks Online enables business owners to know what is selling and what to reorder as inventory tracking feature updates business inventory automatically.
Thus, business owners are able to keep track of what they purchase by creating purchase orders and what they sell by creating sales receipts.
Further, the business can never go out of stock as the low stock alerts would help avoid shortages and reorder inventory on time.
Also, the inventory reports would help identify the trends such as most popular and least selling items and replenish stock accordingly.
But, with the free accounting software alternatives to QuickBooks, small businesses would not be able to undertake inventory tracking and management.
Thus, to track and manage inventory, they would have to invest in a separate software that would lead to increased investment of time and money.
Moreover, this would not allow recording of the accounting information at one place thus adding to the complexity.
6. Cash & Accrual Accounting
QuickBooks Online offers both cash and accrual basis of accounting systems. Cash Accounting is an accounting system in which business transactions are recorded only when cash is exchanged. That is when cash received or cash is paid.
Whereas, accrual system of accounting emphasizes that the revenues of your business are recognized when they are earned. This brings in the matching concept of accounting.
Accordingly, the economic events of your business are recognized by matching the costs incurred with the revenue earned at the time when a transaction occurs. It is regardless of whether cash has been paid or not.
Thus, small businesses and non-manufacturing units can adopt cash basis of accounting. Whereas medium and large businesses need to adopt accrual system of accounting for more accurate view of their business position.
However, few of the free QuickBooks alternatives offer only accrual basis of accounting.
Therefore, home based businesses or self employed, who need cash basis of accounting given the less complex transactions, find it challenging to use such free alternatives.
7. Billable Users
The number of users varies depending upon the QuickBooks Online plan a small business owner chooses to take.
For instance, QuickBooks Online Plus offers five billable users with two accounting firms per license. These user types include Master Admin, Company Admin, Standard, Time Tracking Only, Take Payments Only and Reports Only.
Whereas, this feature is not available in free alternatives to QuickBooks, that is, the registered person alone can have access to free accounting software and its various functionalities.
8. Other Features
QuickBooks offers several other features like budgeting, project cost accounting, Purchase Order management, class tracking and inventory tracking that free alternatives to QuickBooks do not offer.
Furthermore, QuickBooks Online also offers the facility to generate GST Return reports in a proper format so that these can be directly uploaded on the GST portal.
However, other free alternatives to QuickBooks lack in this area big time.
Though, small business owners consider subscribing to free online accounting software, they tend to lose out on a suite of features which can help them streamline their business processes effortlessly.
Moreover, by investing a fair amount of money in QuickBooks, small business owners can get time to their side and focus on much more important tasks.