Stop with the spreadsheets already!
If you run a business, you need accounting software. I’ve said this many, many times, which is why some people don’t talk to me anymore.
Are you looking to move from a series of meticulously designed spreadsheets to actual accounting software? In that case, I will spotlight Wave in this article as a potential alternative.
Wave (waveapps.com) is a sleeper business accounting software that is a super choice if your business bookkeeping is simple.
Below is a list of pros and cons for this online/mobile accounting app.
Easy to set up and use
While business accounting software is never as simple to set up as personal accounting apps, Wave does a good job of walking you through the setup. Also, classifying transactions (aka the most time-consuming part of bookkeeping) is easy to figure out, and the site has tools to make quick work of routine transactions.
Can handle most of your accounting
Some business accounting apps have many features that enable businesses to manage all aspects of their financials. But your business is not that complex. You need to track expenses. You want to generate professional invoices to send to your clients. When your bank asks for financial reports for that loan application, you can send them a ‘profit and loss,’ not an Excel spreadsheet that really only you understand. Look like a real business with Wave as it can handle most business accounting tasks like
- Track income and expenses
- Invoice clients
- Generate standard financial reports like profit & loss, balance sheet, general ledger, cash flow, and agings
- Create journal entries
- Allow access for an accountant and bookkeeper
Bookkeeping is free
When starting a business, any extra expense creates a time-consuming internal debate of cost vs. benefit. For example, do you want to pay $25 per month for accounting software? Doing some simple math, that’s $300 per year. That may be why new businesses rely on nice free spreadsheets.
However, with Wave, the basic accounting features are free. If you want to set up the ability to take credit card payments or need payroll processing, those services have a fee.
Get a free set of personal accounting
As your business finances get organized in Wave, you may notice what a mess your personal finances are in comparison. Wave has a solution for that too. The site lets you set up a separate set of books for your personal finances. It’s built on the same platform as the business books, so you don’t have to learn a new system.
Bank downloads don’t always work as advertised
For businesses that bank at smaller banks or credit unions, the automatic download of transactions into Wave may not work as effortlessly as larger accounting platforms (like QuickBooks). There are workarounds, but you may not want to fuss over transaction imports each month.
There are some things you can’t do
If your business has inventory, Wave can’t track the inventory. Additionally, if you need to track subcategories or different classes of transactions – for example, a landlord tracking expenses and income by the property – Wave is not set up to handle that.
Wave works best for service businesses, i.e., accountants, lawyers, consultants, freelancers, tradespeople, etc.
If Wave is too simple to handle your business accounting, I will be spotlighting more non-QuickBooks business accounting software until the end of the year. If you run a business still in the spreadsheet phase, hopefully, you’ll find a better system in one of these articles.