If you are like most small businesses, your choice for a bookkeeping system will come down to three: manual, off-the-shelf software, and online. Each has their advantages and disadvantages.
Easy, cheap, and fast to implement.
Good for very small businesses that don’t have large inventories or generate
Can’t handle complex transactions or large volumes of invoices.
Because it’s paper-based, files are more easily lost or misplaced.
Can’t generate sophisticated reports that offer real insight into operating a small business.
Off-the-Shelf Software Packages
Automates detailed and labor-intensive tasks such as invoicing and billing.
Generates accurate and powerful reports.
Learning curve can be steep.
Generally requires a consultant to set up.
Requires annual software upgrades.
Can access your bookkeeping and accounting tasks from any computer
with an Internet connection.
No need to install software or upgrade it each time the vendor releases a new version.
Hosted applications may be slower than off-the-shelf software.
Online applications aren’t as feature-rich or as user-friendly as higher-end desktop software.