Accounting, Bookkeeping, and QuickBooks Tips for Small Businesses

Posts tagged small business bookkeeping software

Xero Review

Xero Logo

This weeks online accounting software review is on Xero. Currently, Xero is my favorite cloud based accounting software. Xero is pretty, offers graphs and charts for the visual types, a dashboard that’s filled with quick access to the accounts and reports you need to see every day, Xero is easy to use, and saves a lot of time with their automatic bank imports. Xero was founded in 2006 in New Zealand. They are growing rapidly and have teams located throughout the world, including the US.

Cost: $19/month – $39/month, Free Trial

What I Love:

  • Xero offers daily bank feeds, which is a huge time saver. You can connect your bank account with Xero for automatic downloads of your daily cash transactions.
  • Xero offers the ability to create bank rules for your imported transactions. It takes a while to create the bank rules, but once they’re in place it’s a huge time saving feature. Once a bank rule is saved, Xero will remember how to code those transactions in the future, so you don’t have to.
  • The bank reconciliation feature on Xero is pretty handy as well. Once your bank transactions are imported into Xero (either manually or via the automatic daily bank feeds), users can code and match your imported bank transactions. The cool thing is as you code and match your transactions, Xero reconciles them. Saving that extra step is a huge time saver.
  • The financial reporting in Xero is decent. The reports they offer are the most important and useful ones for small business owners. I love that they not only does Xero offer an Income Statement (Profit & Loss Statement), but they also offer a Balance Sheet. You can also run aged receivable reports, payable reports, sales reports, ledger balances, etc. All of the reports can be exported to an Excel spreadsheet, meaning you can play with your numbers even more!
  • Not only is Xero pretty but it also offers a dashboard you can customize with charts, graphs, and reports. The dashboard gives you a quick glimpse at the numbers that are most important to you, the entrepreneur.
  • The Help feature is extremely useful. You can click on “help” from anywhere in Xero and help topics relating to that page will appear. The tutorials are helpful, very detailed, and will walk you through step-by-step how to use the accounting program.
  • Working and reporting in Multi-currency in Xero is a breeze.
  • It offers a basic inventory tracking system, for small businesses. When your business requires a more robust inventory tracking system, there are several add-on’s to help Xero grow with your business.
  • The payroll system is limited, but you can still keep track of your employees wages, taxes due, and taxes paid through the pay run feature. Xero integrates with ADP, for those that want an all-in-one payroll solution.
  • Another great feature is the ability to track categories in Xero. Although it’s limited to 2 categories, I believe the subcategories is unlimited. So you can track income and expense by department, region, store, property, etc.
  • Xero can also automatically calculate the depreciation on your fixed assets. No more waiting around for depreciation schedules from your accountant.
  • There is a huge number of add-on’s that integrate with Xero. These add-on’s allow the system to grow with your business and add custom features that your business needs. Some examples are WorkFlowMax (job management solution), Vend (cloud based point-of-sale system), Shoeboxed (receipt management), FreshBooks (billing system), (payables solution), etc.
  • I love they offer unlimited users at no extra cost.
  • Another great tool for entrepreneurs is their personal finance system.
  • Like any other cloud based tool, I love the ability to check my numbers while on the go. I can access Xero from my iPad, iPhone, Android, laptop, and anywhere I have internet access.

Here are a few Xero screenshots, so you can see what I’m raving about.

Xero Dashboard Screenshot –

Xero Dashboard Screenshot

Xero Bank Reconciliation Screenshot –

Xero Screenshot Bank Reconciliation

My Wish List:

  • Xero does not accept online payments from customers. However, Xero does play nice with FreshBooks and, so this minor detail can be avoided by using some of their add-on’s and integration partners.
  • I give Xero props for having a pay run section, allowing small business owners to keep payroll info in one place. However, the pay run is very basic. I would love the ability to have the payroll taxes and net paychecks payable post to a payroll liability account – payroll taxes payable & payroll payable. This makes it a lot easier for small business owners to see where their money is going and when cash is leaving their bank account. Currently all payroll payable transactions entered in the pay run are reported in the general accounts payable account.
  • I’ve found it to be painfully hard to correct mistakes. Typically you have to void the entire transaction and then redo it. This is a huge hassle if all you need to do is change a date, an account, or a check number.
  • You can only use check numbers once. Not a huge deal, but I ran into troubles with this when I accidentaly recorded an incorrect check number and needed to fix it. This could pose a problem if your office check numbers are the same as your payroll check numbers. You can not enter letters with check numbers either.
  • The starting chart of accounts is very basic. For a system designed for small businesses, I would love to see a handful of “custom” chart of accounts for various industries. I think it would make it much easier to set up for an entrepreneur.
  • Xero does not offer the ability to print 1099’s. You can export the information into other programs, but this will still be a hassle in January.
  • Xero is still working out kinks with its PayPal integration. Xero has been known to drop a handful of PayPal transactions, creating headaches for accountants and business owners alike. If you have a large volume of PayPal transactions, Xero might not be the best automatic download accounting solution for your business.

Overall, I’ve been really happy with Xero. It offers a lot of the same functionality as QuickBooks, but in a cloud based environment. Xero is continuing to grow and is always adding new features to their system. They do a great job of listening to their users. I’m sure over the next few years Xero will continue to be a favorite online bookkeeping system for entrepreneurs, small business owners, mid-sized business owners, and accountants.


Michelle Edwards, CPA - QuickBooks Consultant Written by Michelle Edwards, CPA
Certified QuickBooks ProAdvisor

Michelle Edwards, CPA is the owner of Trailhead Accounting Solutions CPA, LLC, an Erie, CO based CPA firm focused on providing small and mid-sized businesses with day-to-day accounting, bookkeeping, and Virtual CFO solutions. Michelle is a CFO turned consultant who loves working with small businesses and entrepreneurs. When she’s not crunching numbers, she can be found hiking, remote camping, gardening, quilting, and hanging out with her family.

Outright Review

Outright - Online Accounting and Small Business Bookkeeping Software

This week I’m reviewing Outright. Outright is a very basic online bookkeeping software that lets entrepreneurs organize their small business finances. It was designed for sole proprietors, single member LLC’s, and Schedule C filers who have basic bookkeeping needs. Outright is also a perfect online bookkeeping solution for Ebay and Etsy sellers who started a small business as a hobby. If you’re a mompreneur, small business owner, self-employed, or sell on Ebay or Etsy, Outright might be the perfect cloud based accounting solution for your small business.

Cost: Free – $9.95/month

What I Love:

  • Ability to set up Outright to link to and download transactions directly from Ebay, Etsy, Amazon, private websites, and PayPal.
  • You can also link your bank accounts and credit cards to Outright for automatic downloads, saving even more time from tedious data entry.
  • Outright will automatically categorize your downloaded transactions. Small business owners also have the ability to edit or add transactions manually.
  • I love how small business owners can track their accounts receivables though Outright with the “Money to Collect” section. Outright also has another section under the Income tab to record customer payments.
  • Under the expenses tab small business owners can track their expenses and checks written to vendors.
  • Another cool feature is that Outright can integrate with, to help entrepreneurs organize and keep track of their receipts. Another bonus is that small business owners can automatically import their transactions stored in directly to their Outright bookkeeping software.
  • Outright offers users a decent amount of financial reports to help entrepreneurs keep on top of their business finances. You can track your Profit & Loss daily, weekly, monthly, quarterly or annually. Some other financial reports include keeping track of your types of income, finding out who are your best customers, and reporting where you are spending your money. I love that it offers users the choice to view their financial reports as numbers or as graphs.
  • Outright offers a mileage tracking feature, making it easy to keep track of your business mileage throughout the year for tax purposes. The mileage tracker also has a link to Google Maps, making it easy to record your mileage if you forget to use your car’s odometer.
  • One of my favorite features is their tax section. You can track your business’ sales taxes, have Outright calculate your estimated quarterly tax payments, and assist in calculating your annual taxes. They also have an entire section to help small business owners with their 1099-K’s received from PayPal. It’s a great tool to assist small business owners with their basic tax questions.
  • Outright also has an iPhone app that provides home based business owners on the go with the ability to see their Profit & Loss reports, keep track of their bank balances, see details to their transactions, and receive income alerts so small business owners know when an order comes though.
  • Outright also has an incredible blog filled with tons of useful information that’s easy to understand and that’s written for the small business owner, mompreneur, homepreneur, entrepreneur, and self employed. Their blog includes tax due date reminders, tricks to using their online bookkeeping software, and other helpful information for business owners.

My Wish List:

  • Outright does not have invoicing tools. However, it does integrate with FreshBooks so you can use FreshBooks for your invoicing needs.
  • Small business owners can not enter bills to pay and the bookkeeping software does not track payables. Users can only enter after-the-fact expenses and payments already made to vendors.
  • I have a love-hate relationship with the tax section. I love that helps provide small business owners with an amount they will owe in their quarterly estimated tax payments and helps small business owners figure out their annual taxes. I don’t like that this part of the system is so simple that I worry it would be easy to make a mistake. Even though the software does figure out taxes, I still recommend working with a tax preparer to ensure your taxes are calculated correctly.
  • I wish the software included a balance sheet under the reporting section. I know small business owners are intimidated by the balance sheet, but it’s such an important part to watching a business’ finances.

Overall, I’m impressed with Outright as an online bookkeeping software for small businesses. It offers a lot of great features for entrepreneurs, home office businesses, mompreneurs, self-employed, micro businesses, Schedule C filers, and people selling on Ebay and Etsy. It’s definitely designed for small businesses in mind who have basic bookkeeping needs. However, for these small businesses Outright is a much better bookkeeping tool than using a spreadsheet, a bank statement, or doing shoebox accounting.


Michelle Edwards, CPA - QuickBooks Consultant Written by Michelle Edwards, CPA
Certified QuickBooks ProAdvisor

Michelle Edwards, CPA is the owner of Trailhead Accounting Solutions CPA, LLC, an Erie, CO based CPA firm focused on providing small and mid-sized businesses with day-to-day accounting, bookkeeping, and business solutions. Michelle is a CFO turned consultant who loves working with small businesses and entrepreneurs. When she’s not crunching numbers, she can be found hiking, remote camping, gardening, quilting, and hanging out with her family.