94 Best Accounting Software in 2021

What is Accounting software?

Accounting software automates all financial and accounting processes of a business. The software helps record, analyze and interpret the financial information & transactions. You can automate the manual data entry tasks and prepare transactions quickly using an accounting management software.

Its main key features essential accounting functions like account journal, general ledger, payroll, and trial balance, among many others. Accounting systems can also be used for preparing financial reports and filing GST returns without depending on any third-party application.

The platform further supports multiple options for invoice generation and sharing, and online payment. You can also rack expenses, check the inventory levels and generate bills and reconcile bank accounts with accounting software solutions.

What are Online Accounting Software Functionalities?

Online accounting software functions just like any other SaaS (Software as a Service) solution. Every critical accounting & financial information is stored in the data center, and all you need is an internet connection to access the information. Online accounting software also ensures higher data security and backup, with restricted, role-based access to any financial information.

Web-based accounting software supports single ledger or common ledger accounting from anywhere and at any time. Instant data sharing through cloud-based accounting software eliminates the chance of repetitive data entry. It ensures that every user gets access to the latest list of products, invoices, and customers to manage the general ledger, categorize transactions, generate payroll, and track payments efficiently.

What's the difference between desktop and cloud accounting software?

Desktop or offline accounting software comes with a package installer in a physical storage device such as DVDs, external hard drives and pen-drive. In addition, data related to the software is stored in the local computer.

Cloud accounting software allows you to access the data online with a single sign in. Whatever work you do on the software is stored remotely on third servers. This enables users to access the accounting software from any location with internet connection, and on any device, including smartphone and tablets. 

Today, most of the accounting software are available in the cloud version for SMEs and big enterprises. Online accounting software companies also run software update and fix bugs remotely, without any hassle. Moreover, cloud accounting software does not require an in-house hardware installation and is a budget-friendly option for SMBs.

Types of Accounting Software

• Spreadsheets: Google Sheet, OneDrive and Microsoft Excel are often used by startups to list their income, expenses, sales and other financial data. For managing advanced accounting functions, businesses often opt for a complete accounting solution.

• Online Accounting Software: Online accounting software is the web-based or cloud accounting software, which saves all your financial data on third-party servers. It allows 24x7 access to business data with just a system and an internet connection.

• Offline Accounting Software: An on-premise accounting software, which stores financial data on your in-house server. Its features can be accessed even when you are offline.

• Small Business Accounting Software: This type of software consists of the basic accounting and bookkeeping functions. You can easily manage payroll, billing, invoicing and reporting needs with small business accounting software.

• Enterprise Accounting Software: It includes a package of advanced accounting management features like sales & purchasing, reconciliation, customer relationship management, business intelligence, and more.

Accounting Software Modules & Features

• Chart of Accounts: Chart of Accounts is basically a complete list of ledger accounts that provides an overview of a business’s transactions. The chart is arranged using categories like expenses, income, liabilities, assets and capital.

• Balance Sheet Reports: Balance sheet and profit/loss reports can be created easily with an accounting software. The reports are helpful in highlighting the profitability ratio, expense incurred, and income generated.

• Cash Flow Statements: Accounting software analyses the transaction records for producing cashflow statements. You can do this for the coming quarters or months.

• GST and Returns Filing: This particular module helps you file GST returns seamlessly by pushing transactions directly into the GST portal. Make your business GST compliant by preparing and filing GSTR-1, GSTR-2, GSTR-3, and GSTR-4 return online effortlessly.

• Debt Collection: Through the debt collection module, you can keep track of whether the overdue bills have been collected or not. You can also quickly identify and resolve issues that may be affecting the debt collection process.

• Credit Management: Credit management is required for handling payables and receivables. You can also use this module for defining credit limits and periods for every customer.

• Banking: Reconciliation of bank statements with an accounting software is easy and so is managing the bank accounts. The module also makes cheque printing easy for making payments.

• Budgeting and Forecasting: By the end of a financial year, accounting software helps assess your business performance and set a budget for the next year. Based on your budget, you can establish sales targets and assign the capital for different expenses.

• Payroll: Payroll accounting software lets you process employee payroll, expenses, and reimbursements. This module also helps in the preparation and printing of cheques while taking care of all legal and tax obligations.

• Inventory: The main purpose of an inventory management module is to keep track of your stock levels. You can sort out issues related to procurement, availability, and movement of your goods. Also, you can keep a close eye on your inventory to avoid overstocking or understocking.

• Project Accounting: This is a customized module found in top accounting software and is used primarily by project management and deployment teams. It helps in making project estimates based on the overheads and costs pertaining to labor, material, and equipment.

• Fixed Asset Management: This module helps in the management of a company’s financial data related to fixed assets in a more accurate manner. It helps in taking care of audit history, cost records, depreciation calculation, resource allocation, etc.

• Billing and Invoicing: Accounting ERP software helps automate several routine tasks. It helps generate invoices quickly and sharing with the clients for timely payments.

• Tax Management: Accounting software helps in carrying out tax calculations automatically, along with tax reporting and integration of multiple tax rates. You can easily collect tax information from all financial documents into one single repository to generate reports necessary for tax filing.

• Receivable and Payable: This module assists in managing customer invoices and processing customer payments. This module is chiefly used to create bills or invoices for customers. You can also keep a tab on individual deposits to bank accounts so that deposit information can be uploaded and applied to customer accounts automatically.

• General Ledger: Without the general ledger, you won’t be able to create vital financial documents, such as trial balance, balance sheet, and profit and loss statement. This module is used to record financial transactions not recorded in other accounting software modules. It helps create a trail of information needed for audit purposes.

Advantages of Accounting Software

• Accounting Made Easy: The major benefit of accounting software is that it enables even the non-accountants to understand and analyse their financial data. You don’t require any special training to execute your accounting operations. And you get to manage accounting functions in compliance with the legal standards of your state/country.

• Mobile App to Manage Accounting Functions on the Go: Top accounting software offers the mobile app functionality on Android and iOS devices to help you manage financial data and transactions on the go.

• Increased Productivity: By migrating your financial data to an accounting ERP software, you can automate and streamline your mundane tasks, such as collection, organizing, and analysis of your most sensitive data.

• Tax compliance: Accounting software helps adhere to tax regulations. The tax rules can be pre-set and are taken care of by the vendors whenever an update happens. It also acts as a source of information pertaining to audit and tax, making your job easier.

• Accurate Forecasting: To analyse your financial numbers, you need the best accounting solution. It’ll assist you in understanding the situations where you need to cut expenses or where you should make investments. This will help give a clear view of your present financial scenario, helping you devise innovative strategies to funnel resources in the right direction.

• Financial Data Security: An organization’s financial data is considered critical and must be prevented from falling into wrong hands. This is where an accounting solution comes in handy, helping you keep your data secure either through maintaining a backup or having multiple security levels for accessing the sensitive data.

• Cost Savings: By automating administrative tasks and core calculations, you won’t have to devote valuable resources or outsource finance management to a financial expert.

How to Choose Accounting Software for Small Business?

An ideal accounting software solution with features well-suited for your business has the potential to reduce time, effort and scope of errors significantly. However, it’s important to keep the following points in mind before choosing any accounting software for your business.

• Cloud-Based Vs On-Premise

  Cloud-based applications bring a gamut of benefits for modern businesses; whether small, medium or large.

  They can be accessed remotely and come with their own servers. This means that the cost of getting separate servers can be saved. Moreover, the software can automatically be upgraded on the server end by the service provider, saving you the time, cost and resources that would have been spent on upkeep and maintenance.

  One of the most prominent features of cloud-based applications is that it can be accessed on any device- laptops, tablets and smartphone. Moreover, the classified and crucial data will be stored securely on cloud, in case of any mishap.

• Budget

  The cost of specialized accounting software solutions varies depending upon the tools and features that they provide. Therefore, it is important to carefully select the one that fits your budget while also fulfilling your organizational requirements.

• Add-on Features

  Add-on features in accounting software solutions will help in automating diverse financial management processes. For instance, a software solution may provide remote access, and options for online payments through third-party software integration. You can ask for add-on accounting features as per your specific process requirements.

• Accountant’s Opinion

  Last but perhaps the most crucial of all, it is highly recommended to take your accountant’s advice before choosing a software. In the end, it will be the job of your accountants to work with the accounting software.

  Hence, they would have a better perspective on which software is best for the business. In addition, they would also need a first-hand understanding of the software through product demos.

How Does Accounting Tools Work?

Accounting tools offer modules, which are crucial for finance management, budgetary allocations & expense analysis. Popular accounting tools work by:

• Generating financial reports: Account management software generates reports like balance sheets, cash flows and income statements for analyzing the profits earned.

• Analyzing cost allocations: Accounting software helps businesses undertake cost allocation analysis. This is essential for assigning costs to specific goods & services.

• Managing the budget: Accounting software allows businesses to set financial goals on a yearly/semi-annual basis and assigning the budget for specific tasks.

• Performing fund flow analysis: Accounting tools help perform fund flow analysis to determine if the funds have been utilized properly.

How Does Accounting Software Help Save Time & Money?

Number crunching is the first step when it comes to making sense of your financial data. This is where an accounting solution comes into the picture. Business accounting software gives financial numbers a meaning, so you can decide whether you need to cut down on expenses or start pumping up investments. 

 By using an accounting software solution, you’d have a clearer overview of your present financial state. This, in turn, would help you devise strategies to grow your business to new heights by allocating resources smartly. 

In addition, you can use the accounting software to send recurring invoices, alerts, and notifications, which will save your time. You can effortlessly execute account reconciliation by matching transactions.  

If you have to submit quotes or estimates, just go for an accounting solution that can convert those documents to invoices in a few clicks. It also helps reorder products when your inventory levels drop below a set threshold by generating purchase orders automatically. Basically, you can automate a great many tasks with accounting software. 

Accounting Software For Financial Business

Number crunching is the first step when it comes to making sense of your financial data. This is where an accounting solution comes into the picture. Business accounting software gives numbers meaning, so you can decide whether you need to cut down on expenses or start pumping up investments. By using an accounting software solution, you’d have a clearer overview of your present financial state. This, in turn, would help you devise strategies to steer your business to new heights by allocating resources prudently.

In addition, through the magic of innovation, you can program your accounting software to send recurring invoices, alerts, and notifications, helping you save time. You can effortlessly execute account reconciliation by matching transactions. Have to submit quotes or estimates? Go for accounting solutions that can convert those documents to invoices in a few clicks. Reorder products when your inventory levels drop below a set threshold by generating purchase orders automatically. Basically, you can automate a great many tasks with effective accounting software.