Best Accounting Software and Invoice Generators of 2020
December 30, 2019
When you start a business, accounting software is one of the first business applications you need to buy. Choosing the right one is important, because you'll use it every day to track the money coming in and going out of your business. With it, you'll create invoices, record incoming and outgoing payments, identify and follow up on past due receivables, and run reports that help you analyze your financial health and various aspects of your business.
With hundreds of accounting software programs on the market, it's difficult to decide which one to choose. In our search for the top accounting software solutions, we looked for affordable, easy-to-use accounting programs designed for small businesses. We wanted them to be cloud-based and have a mobile app so you can access your data at any time, from any place.
We looked for accounting systems that have timesaving features, such as automated bank feeds, automatic payment reminders, and online invoicing and payment acceptance. We also looked for software with comprehensive, customizable, real-time financial reporting, as it is crucial to monitoring and understanding your business finances.
Here are our best picks and details about our selection process. Learn more about what you should look for in accounting software by reading our accounting software buyer's guide.
Our Best Picks
Editor's note: Looking for the right accounting software solution for your business? Fill out the below questionnaire to have our vendor partners contact you about your needs.
Intuit QuickBooks Online
QuickBooks Online from Intuit is one of the most popular small business accounting solutions on the market – and our pick as the best overall business accounting software program. It's easy to use and loaded with features, including several that save you time. The company estimates that, on average, it saves its users 40 hours each month on accounting tasks. It can be used by nearly every type of business and has plans for businesses of all sizes, from self-employed individuals and small businesses with basic accounting needs to established businesses that need advanced features such as time, project and inventory tracking.
In addition to its great features, QuickBooks is used throughout the nation. This means accountants across the U.S. are familiar with the platform. When it comes to learning the program or needing accounting help, you can reach out to any accountant nationwide and they'll have some idea of what you're talking about. That can't be said for other small business accounting software solutions. If you're looking to outsource some accounting tasks or bring on a new accountant, it's hard to go wrong with having them use QuickBooks as your business's primary accounting software solution.
What makes QuickBooks so special is its price. The software is incredibly affordable for what it can do. There are numerous packages, so small businesses of differing sizes can all benefit from the software. It's rare that a business solution with so many capabilities is so affordable, but QuickBooks delivers. It's an incredible service that small businesses across the country have utilized.
When it comes to using simple accounting software, you don't want an outdated user interface or features that are so basic you can't glean important business insights from the data. That's what makes Zoho Books an elite service. While the platform is easy to use, it doesn't lack features, and the interface is modern and sleek. Zoho Books caters specifically to really small businesses like freelancers and new entrepreneurs, and it shows. The company has created an affordable product that adequately meets the needs of the smallest businesses. Even home-based businesses can gain a lot by using Zoho Books.
Zoho Books helps automate certain processes, too, which is a nice time-saving feature. Recurring invoices and automatic payment reminders are easy to set up. Small businesses are always looking for ways to be more efficient, and Zoho Books helps make that happen.
Additional features include invoicing, online payments and a mobile app. In a world that's becoming increasingly reliant on mobile-based businesses activities, some small business owners will appreciate being able to get things done on a mobile app. Freelancers and other small businesses can benefit from using these features, too, as they can save time and add convenience to their daily work lives.
FreshBooks Accounting Software
Although all accounting software products have invoicing tools, FreshBooks' are incredibly easy to use, which is why we picked it as the best invoicing software program for small businesses. The WYSIWYG format is intuitive, and with just a few clicks, you can add billable time and expenses; customize the look of the invoice; and set up recurring invoices, automatic payment reminders, and late fees. This accounting software connects to your bank, generates several reports, tracks time and helps you manage projects.
It gives you all the necessary features in an accounting and invoicing software application. While it's not as comprehensive as some of the other options on the market, FreshBooks offers tremendous value as an accounting software solution with strong invoicing capabilities.
This software works best for project-based businesses and freelancers. Any business generating invoices frequently should consider FreshBooks. The ability to combine accounting software tools and invoicing tools is rare, but FreshBooks does the job effectively. For businesses that don't send invoices, other accounting solutions will make more sense, but freelancers and project-based businesses will naturally be drawn to the features and affordability of FreshBooks.
We recommend FreshBooks to any business where invoices play a role in its daily operation. The price, features and usability of FreshBooks make it one of the best accounting solutions on the market.
Xero can save you time and simplify accounting by automating tasks. It integrates with more than 700 apps. Xero comes with 24/7 email and live chat support and outbound phone assistance at no extra cost. Should you run into a problem, you can call the company to receive help fast and free of charge. That's ideal for small business owners who need advice instantaneously.
We believe that Xero's assortment of features, combined with its customer support, makes it one of the better options on the market. When you add in the company's cloud-based solution, you get an ideal accounting software app for businesses that use Macs. No business should have to accept and deal with impaired software functionality because it uses one type of operating system versus another OS. Xero circumvents this dilemma.
Mac users will be absolutely thrilled with Xero, as it gives them access to fantastic features they might not normally have access to when using Macs. While Xero isn't quite to the level of some of the other solutions on the market, it's close. The accounting software solution is affordable, usable and generally solid.
If you use a free accounting software app, there's an assumption that you're using a lesser product. That's not the case with Wave. Wave delivers fantastic features, including automated tasks related to invoicing and payment reminders. Wave is a legitimate accounting software solution that just so happens to be free.
Small businesses, especially those on the smaller end of the small business spectrum, should consider using Wave. The platform is easy to use, and it offers many of the features that the best accounting software solutions provide. It's worth considering for the smallest of businesses because there isn't a major drop-off in terms of quality from many of the paid solutions. In fact, Wave is an improvement over some of the paid accounting software solutions available to small businesses. Don't let the price fool you, it's a quality service.
If you're a cash-strapped business or a freelancer, there are a few reasons to consider Wave. The solution is free, it offers tremendous features, and it's easy to use. What's not to like? While it's not as comprehensive as other software options, Wave blows other free accounting software solutions out of the water.
What to Expect in 2020
The best accounting systems have features that save you time, which is important since many accounting tasks are repetitive and tedious. Despite existing timesaving features, Xero says that manual data entry takes up to 30% of a bookkeeper or accountant's time. It's for this reason that in 2020, software companies will continue to develop automations that use artificial intelligence and machine learning to further reduce repetitive tasks and manual data entry. Existing examples of timesaving automations include recurring and batch invoicing, recurring online payment remittance, and automated bank reconciliation and expense categorization.
As with other types of business software, more accounting systems will become cloud-based and have mobile apps in 2020, giving busy business owners anytime, anyplace access to their accounting data. The best accounting systems already have this functionality, with mobile apps that support various on-the-go tasks, such as creating and sending invoices, accepting and recording customer payments, and capturing receipts and creating expense reports.
These advances, together with improved UI, are making it easier for small business owners to handle accounting on their own – even if they don't have an accounting degree. However, small businesses owners have many demands on their time and need help with the day-to-day bookkeeping tasks. For this reason, more accounting software providers will offer bookkeeping services as an add-on to their accounting software.
Outsourcing is a good option for small businesses, according to Purdue University Global, because it's less expensive than hiring full-time accounting staff, gives small business owners on-demand access to accountants and can lower a small business's risk of fraud. Also, whether or not you outsource your bookkeeping, industry experts recommend working with an accountant for business analysis and strategic advice that can help your businesses grow.
Q: How does accounting software work?
A: The software records transactions and tracks different accounting metrics. You can set up the software to automatically receive financial information from your bank, or you can use an extremely basic version that might require manually inputting the data. We encourage small business owners, though, to use software that automatically receives financial information from your bank and credit card provider to track your business's finances. Further, most software solutions store the information in the cloud, and your data is secure and safe should your computer crash or you experience other technical issues.
Q: Which small business accounting system is best?
A: Based on our research, QuickBooks Online is the best overall small business accounting system. But, depending on the specific needs of your business, another system may be a better fit or better value. For example, if your business provides a service and works with clients on a project basis, FreshBooks might be the best choice for you because of its project management features. See our best picks above for our specific recommendations for different business sizes and needs.
Q: What do you need from your accounting software?
A: You need accounting software that tracks the money moving in and out of your business, with both accounts payable and accounts receivable features. Some software solutions, however, don't include both accounts payable and accounts receivable information. Also, accounting software should connect to your bank and credit card accounts and automatically download your transactions. In addition to the above, if your business is service-based, you may need project management tools. If your business sells products, you may want an accounting solution that has inventory management features. Last, look for software solutions that offer you greater advantages by connecting to other business applications you already use, such as your point-of-sale system, customer relationship management or email marketing software apps.
Q: Do you need online bookkeeping software instead of accounting software?
A: For small businesses, the term "online bookkeeping software" is interchangeable with "online accounting software" (however, there is a difference between bookkeepers and accountants; read this article to learn more). All the best online accounting programs for small businesses have bookkeeping capabilities that allow you to record debit and credit transactions as well as accounting features that let you run reports and analyze your business's financial performance. Look for more than just a bookkeeping solution; accounting software should include more detail, and let you generate invoices and detailed reports.
Q: Should your accounting software also act as an invoice generator?
A: It depends on your business. If you generate (or expect to generate) a lot of invoices to send to clients and customers, we recommend that you find a comprehensive accounting application with invoice-generating features. Freelancers should consider solutions with invoice generators as part of the software.
Q: What does an online accounting service do?
A: Online accounting services can perform a wide range of tasks for busy business owners. Some focus on bookkeeping duties, such as entering and categorizing transactions, reconciling accounts, and generating financial statements and reports that you can take to your CPA at tax time. Others provide payroll and tax preparations services. Some, such as virtual controllers, CFOs and CPAs, provide high-level accounting services like internal audits and financial planning and analysis.
To determine the best accounting software for small businesses, we spent dozens of hours researching the top applications. Here is an explanation of our selection process.
Locating the Best Services
We began our research by asking business owners which accounting software program they use, what they love about it and what they think makes it the "perfect" application. We also researched popular accounting software apps that frequently appear on reputable review websites, top lists and business websites.
Choosing the Best Services
We then created an extensive list of accounting software that included the apps we identified from our research, applications we were already familiar with and vendors that have previously pitched their software to us.
We narrowed this list further based on different use cases and a wide range of criteria, including cost, features and limitations. As part of our research, we studied user reviews, watched tutorial videos, and checked out customer resources offered by each vendor, such as knowledgebases, blogs and guides.
Researching Each Service
Next, we evaluated each program by signing up for a trial or demo account and testing the software ourselves. This firsthand experience helped us understand how the features work, whether the programs are worth their price tags and if the software really is as easy to use as the vendor claims it is. To further inform our decisions, we contacted each vendor to measure the quality of its customer support.
Analyzing Each Service
We started with more than 100 accounting software products on our list; however, following our research and evaluation, only 11 made it to our short list: Billy, FreeAgent, FreshBooks, Intuit QuickBooks Online, Kashoo, OneUp, Sage One, Wave Financial, Xero, ZipBooks and Zoho Books. Our picks for the top accounting software programs are QuickBooks Online, FreshBooks, Xero, Zoho Books and Wave Financial.
Additional reporting by Bennett Conlin.
Full List of Accounting Software Solutions
Here's a full list of accounting software vendors and a summary of what each company says it offers. This alphabetical list also includes our best picks.
AccountEdge – AccountEdge offers two versions of its accounting software, plus an ERP through its parent company, Priority. AccountEdge Basic helps sole proprietors automate their bookkeeping, while AccountEdge Pro is full-featured accounting software for small businesses. Both are desktop-based with a one-time fee. If you want remote access, a cloud collaboration tool is available for the Pro plan as an add-on. accountedge.com
And Co – And Co from Fiverr is free business software for freelancers that provides many of the standard services associated with accounting software, including invoicing, subscription billing, expense and time tracking, and reporting. Its app is available for both iPhone and Android phones, and it integrates with other popular applications like Stripe, PayPal, Zapier, Slack and MailChimp. and.co
Billy – Billy is attractive, basic accounting software for small service-oriented businesses. With it, you can record expenses, generate reports, and create quotes, estimates and invoices. It connects to your business bank and credit card accounts to automatically download transaction data and has a proactive reconciliation process that predicts matches. It has an iPhone app and a Chrome extension for capturing receipts. billyapp.com
CenterPoint Accounting – CenterPoint Accounting from Red Wing Software has multiple editions of its accounting software for different types of organizations, including businesses, farms, nonprofits and municipal government. It supports an unlimited number of transactions, customers, suppliers and products, and there's no limit to the years of historical accounting data you can store. Payroll services are also available. redwingsoftware.com
CheckMark MultiLedger – CheckMark MultiLedger is desktop accounting software for small businesses. It supports up to 10 simultaneous users, and its features include A/P, A/R, bank reconciliation, commissions, general ledger, inventory, invoicing, job tracking, purchase ordering and reporting. The company offers a cloud backup add-on for a monthly fee. The company also offers 1099 software, which you can use to print or e-file tax forms. checkmark.com/multiledger
Crunched – Crunched is cloud-based accounting software designed for both new and established small businesses. With it, you can track your finances, send quotes and invoices to customers, track bills and expenses, reconcile transactions, and generate reports. The company offers its own payment processing service, which you must use if you want to accept online invoice payments, and integrates with Gusto for payroll and HR services. crunched.io
Denali – This on-premises accounting system from Cougar Mountain Software can be used by businesses of all sizes, including those with multiple locations. The software is modular, allowing you to customize it with just the features you need. Modules include payroll, inventory and POS. POS hardware and e-commerce websites are also available from this company. cougarmtn.com
FreeAgent – FreeAgent is cloud-based accounting software for small businesses, freelancers and consultants. It supports unlimited users, clients and invoices for one monthly price. Features include automatic bank feeds, recurring invoices, automated payment reminders and time tracking. It also has project management tools to help you track billable hours and expenses. freeagent.com
*FreshBooks – A favorite among small business owners, FreshBooks is one of the most user-friendly, cloud-based accounting applications for nonaccountants. It makes it easy to bill clients, set up recurring invoices and automatic payment reminders, and accept online payments. Its mobile app allows you to accomplish many accounting tasks on the go, such as invoicing, time tracking and managing expenses. Read our full review here. freshbooks.com
Harvest – Harvest makes it easy to bill clients and get paid. It offers a simple platform that lets you easily track time and turn billable hours into professional invoices. You can also log expenses, take snapshots of receipts, generate reports, and connect the accounting program to Google Apps, Salesforce, Basecamp and more than 50 other business programs. getharvest.com
Hiveage – Hiveage is online invoicing software for freelancers and small businesses. It allows you to create estimates and quotes, then convert them to invoices after client acceptance. The software tracks time, expenses and mileage. It also lets you accept online payments, including recurring payments such as subscriptions. All plans support unlimited clients and invoices. hiveage.com
Kashoo – Kashoo's online accounting software can handle your invoicing, expense tracking, and double-entry bookkeeping on your computer, iPhone and iPad. It connects to your bank accounts, accepts online invoice payments, generates reports, and offers collaboration features that let you share your books with your bookkeeper, accountant and business partners at no extra cost. kashoo.com
Less Accounting – Less Accounting is accounting software for small business owners who want to spend less time managing their finances and more time running their businesses. It automates tasks such as data entry and billing, and it has features for invoicing, tracking expenses and mileage, managing contacts, and generating reports. The company also offers bookkeeping services. lessaccounting.com
myBooks – myBooks by Zetran is affordable cloud-based accounting software for entrepreneurs and small business owners. It has enterprise-grade security and connects to your bank feeds to automatically import transactions. Your key accounting metrics are displayed as charts and graphs on the dashboard, and you can easily create attractive invoices using its built-in templates. zetran.com/mybooks/
Officewise – Formerly known as Alatus, Officewise is web-based accounting software for small businesses. It has month-to-month subscriptions and offers a free plan for very small businesses. You can use it to send quotes and invoices, manage bills and expenses, create purchase orders, track inventory, create budgets, and generate more than 50 reports. officewise.com
OneUp – OneUp is online accounting software for small businesses that's especially well-suited for businesses with sales teams and inventory. With it, you can create and send quotes or sales orders, convert them to invoices, track bills, and manage inventory in real time. It uses AI technology to speed bank reconciliation and includes CRM tools so your sales team can use the software to follow up on leads. oneup.com
Patriot Software – Patriot Software's online accounting system for small business owners allows you to choose between cash, modified cash or accrual accounting methods. You can invoice your customers, track payments and expenses, and generate reports such as a profit and loss statement, balance sheet, and paid and unpaid customer invoices. The company also offers payroll software. patriotsoftware.com
*QuickBooks Online – QuickBooks Online from Intuit has both accounts receivable and payable features, and it can track projects and inventory, making it a great choice for nearly every business type. If you want to customize the software with additional features, you can choose from hundreds of apps that integrate with this system. For those who prefer to install software rather than use an online app, the company offers QuickBooks Desktop, QuickBooks Desktop for Mac, QuickBooks Premier and QuickBooks Enterprise. Read our full review here. quickbooks.com
Quicken Home & Business – Quicken lets you manage both your personal and business finances in one place, making it a convenient solution for very small businesses and home-based entrepreneurs who don't need accounting software designed for larger or more established businesses. Although it's only available for Windows, it has iOS and Android apps, and the Quicken on the Web feature allows you to access key features from any browser. quicken.com
Sage 50 Cloud Accounting – Sage 50cloud Accounting is a desktop accounting solution that automatically backs up your data to the cloud and has remote access capabilities. It integrates with Microsoft Office 365 and connects to your bank accounts to help you manage your cash flow. Features include invoicing, inventory management, expense tracking and reporting. sageintacct.com
Sage Intacct – Sage Intacct is advanced, cloud-based financial management software for midsize businesses. It automates processes and generates a wide range of reports, giving you the ability to evaluate your business's performance from any financial angle. It integrates with Salesforce CRM and other popular business systems. Other Sage accounting products for midsize and large businesses include Sage 100cloud, Sage 300cloud, Sage Business Cloud Enterprise Management and Sage Fixed Assets. sageintacct.com
SlickPie – SlickPie is online accounting software for freelancers and very small businesses. Two plans are available: The Starter plan is free, and the Pro plan carries a monthly subscription fee. Features include bank feeds, online and recurring invoicing, automatic past-due reminders, bill and expense tracking, sales tax tracking, and reporting. slickpie.com
Tipalti – Tipalti's online accounts payable platform is designed for small and midsize businesses with 100 or more suppliers or 1099 contractors, including international ones. It estimates that it can eliminate 80 percent of your accounts payable workload by automating multiple processes, including supplier onboarding, invoice processing, tax and regulatory compliance, and account reconciliation. tipalti.com
*Wave Financial – Wave's cloud-based accounting platform is free to use and offers many of the same features as paid accounting software. It connects to your bank and credit card accounts, tracks your income and expenses, and allows you to create and send invoices, including recurring billing. Online payment and payroll services are also available from this company. Read our full review here. waveapps.com
WorkingPoint – WorkingPoint is all-inclusive, cloud-based accounting software. It connects to your bank and credit card accounts and includes tools for invoicing, bill and expense tracking, inventory management, contact management, and financial and tax reporting. The company also offers payroll and email marketing services. workingpoint.com
*Xero – Xero online accounting software for small businesses is affordable and easy to use, and it integrates with more than 700 third-party business solutions. Features include invoicing, inventory, bank reconciliation, bill tracking, reporting, and project time and cost tracking. Xero has mobile apps for Apple and Android devices, allowing you to accomplish accounting tasks on the go. Read our full review here. xero.com
Yendo – Yendo small business enterprise resource planning (ERP) software comes with accounting, CRM and project management modules as well as a dashboard that gives you a holistic look at your business. The financial module has tools to help you create invoices, send reminders, record payments and expenses, generate reports, and reconcile accounts. yendo.com
ZipBooks – This online accounting software offers several plans, including one that's free and one that includes bookkeeping services. ZipBooks uses double-entry accounting, connects to your business bank accounts and generates a variety of reports to help you manage your business. It also includes invoicing, recurring invoicing, online payment acceptance, and billable time and expense tracking tools. zipbooks.com
*Zoho Books – Zoho Books is full-featured accounting software with a small business price tag. Features include invoicing, automatic payment reminders, time and expense tracking, reporting, and reconciliation. It has client portals that your customers can use to approve estimates, pay invoices and view statements. This software integrates with other Zoho applications, payment gateways like PayPal and Square, and popular business solutions like Office 365 and Slack. Read our full review here. zoho.com/books
Ready to choose an accounting software solution? Here's a breakdown of our complete coverage:
- How to Choose Accounting Software
- Best Small Business Accounting Software
- Best Accounting Software for Mac
- Best Accounting Software for Really Small Businesses
- Best Small Business Invoicing Software
- Best Free Small Business Accounting Software
If you'd like your company to be added to this list and possibly considered as a best pick for our next round of reviews, please email your request to firstname.lastname@example.org.
FreshBooks Accounting Software
Intuit QuickBooks Online
Editor's note: Looking for the right accounting software solution for your business? Fill out the below questionnaire to have our vendor partners contact you about your needs.