Quickbooks, the accounting software used for many small businesses, is effective for managing payables and receivables and cash flow. I have three clients that use Quickbooks, and I am familiar with three different versions of the software. I get questions from prospective clients about how easy is it to use the software. [ It depends.] I find it fairly easy because I understand its objective of maintaining books. I don’t think you have to be accountant to use it but it helps. As with any software application, you have to take the time to learn how to use it. If you don’t have the time, then the application becomes useless and ineffective. I have had clients that still maintain Excel spreadsheets for things that are already in Quickbooks, and I had have to show them the easier way.
Here are some tips for using Quickbooks:
Buy or borrow a first year accounting book to understand the basics before even setting up Quickbooks. It will help to understand the terminology.
Spend a lot of time upfront with the questionnaire to get a true understanding of what kind of business you have. (i.e. service or retail;)
Decide on whether you are accrual or cash basis (Accrual is GAAP, but some businesses’ revenue is solely based on contingency)
Include every recurring expense, long term and short assets into your Chart of Accounts.
Check to see if your bank account transactions can be downloaded. This makes bank reconciliations easy and timely.
Check out the Quickbooks FAQs.
NOTE: It’s better to purchase a 2005 version of the software than the 2006 since they are more users out there who can provide more information with older version than the new version.