For many businesses, particularly for those with limited specialist knowledge, choosing the right accounting software can be a daunting task.  It’s pretty hard for the untrained eye to discern the differences between the plethora of packages on the market. However, if you ask the right questions upfront you’ll not only make your life easier but could even save on some of your accountant’s bills down the line. So what should you look for? 

Here are my top five tips:

1. Will it suit my business?

Take a moment to think about your business:

• Do you process many transactions every month?
• Do you make transactions in multiple currencies?
• Do you have several locations / branches?
• Does the software need to link into a point of sale or other operational system?
• Does the software need to handle multiple stock lines or complex stock production?
• Do you have bespoke reporting requirements?

If any of the above apply, it’s worth checking that the software can meet your requirements, not just right now but also in the future as your business grows.

2. Who will be using it?

Will the software be accessed by several people with different levels of knowledge and experience? If so look for a package where you can restrict an individual’s access to reduce the risk of errors. Also consider where your employees are physically based. If they are scattered across the country a cloud-based solution (i.e. where the software is hosted on the supplier’s servers rather than your own) may be more practical. It’s also important to check that the supplier offers a decent level of support. Bear in mind that e-mail only customer service may seem great until you find yourself up against a pressing deadline.

3. Will it make your life easier?

Many accounting packages now include a range of features that will reduce the workload for both you and your team. Look out for the following:

• Will it pull in automated bank feeds?
• Are bank reconciliations semi-automated?
• Does it interface with other software (i.e. EPOS or payroll systems)?
• Is the VAT reporting linked to HMRC?
• Can I attach electronic documents (i.e. scanned invoices)?
• Will it manage my fixed assets (many of the basic ones don’t)?
• Can I design my own reports?
• Does it handle employee expenses?

4. Cloud or office-based?

Several companies now offer cloud-based accounting software for a modest monthly fee. This will not only save you money on hardware but will also ensure your data is automatically backed-up. However, if you do go down this route it’s important to satisfy yourself that the company in question has robust processes for the security and storage of your precious data.

5. Cost

When evaluating different packages, in addition to the software cost, it’s important to consider the cost of any related hardware, set-up fees and ongoing support fees. And don’t forget that the overall cost should be weighed-up against savings made through process improvements (see point 3 above).

Remember, while most software firms will attempt to dazzle you with slick presentations, the only real way to get an unbiased view of their product is to speak to their other clients. You can tell a lot – not much of it good – about a firm that is unwilling to provide you with such referees.