An Overview of Web-based Bookkeeping Solutions

Web-based accounting first came on the scene in the late 1990s as an alternative to desktop accounting. Today there are myriad solutions to help you manage your books online, including QuickBooks for the Web and ePeachtree.

When you use an online application (sometimes called a hosted solution), you contract with a service provider to securely store and back up your financial information. You access your financial records online by entering a password, and the service provider is responsible for providing software updates, security and data storage. 

Most providers let you pick and choose from a menu of features, but basic service generally includes double-entry general ledgers, invoicing, accounts payable, accounts receivable and financial reporting. Some applications also include time sheets and expense reports, as well as payroll, check writing, credit card and inventory features. Basic service costs between $5 and $20 per month for a set number of users, and you can choose the level of access each user receives. Advanced features, available for an additional cost, include tools to help you manage e-commerce, sales, and customer and vendor relationships.

Online applications certainly aren't the right solution for every business. First, hosted applications are slower than locally stored applications, unless you're using a high-speed Internet connection. And second, because they're newer than desktop applications, many online applications aren't as feature-rich or as user friendly as higher-end desktop software.

But for some businesses, especially e-commerce shops, the advantages of using an online accounting solution might outweigh the drawbacks. Consider some of the ways these Web-based applications can help your business: