Quickbooks Review – Worth It?

Ah, Quickbooks – the crème de la crème, the final frontier, the seemingly only product out there for small-business owners, right?

Well, that’s at least what Intuit would like you to believe.

The truth is, there are a number of comparable products out there, with their own quirks, enhancements, and pitfalls when it comes to small-business bookkeeping.

But let’s take a look at Intuit’s Quickbooks before we dive into any of those.

Quickbooks has a lot of functionality packed into a small piece of software

Chances are, you don’t need a lot of the functions that Quickbooks offers. Quickbooks can be great (or okay) if you have daily sales coming in through Square and you need to match these sales directly to the product invoice, meanwhile keeping meticulous track of your cash-on-hand, product inventories, and any unpaid invoices from suppliers.

Quickbooks is a one-stop-shop that most (or really, all) bookkeepers and CPA’s will know how to plug into. It’s as simple as sending an invite to your accountant’s email and they can start to get their hands dirty.

If you’re using Quickbooks self-employed, though, there is no access for your accountant unless you pay $25/month to upgrade to Quickbooks Online.

Let me save you the trouble and say that Quickbooks Online is probably not worth $25/month unless you have a similar story as the hypothetical business I mentioned above. Even then, it’s worth reading further.

Quickbooks does some things quite well. Primarily: Auto-categorizations

Fancy how having entrepreneurs using their free software for years has gifted Intuit a treasure-trove of information and data related to how to categorize transactions at small vendors such as Dolls Kill, your local Gyro merchant, and Vail Resorts. For the most part, Quickbooks is able to match (some of) your expenses to an appropriate category right out-of-the-gate.

Something Quickbooks does not do, however, is keep a careful eye on the categories themselves to make sure your business doesn’t enter audit-risk territory. For example, even if it is true that you spent $11,000 on a business trip to Cancun to connect with your new business partner, stating a total gross revenue of $43,000 for the year would put you in the high-risk territory when it comes to the IRS. These expenses might otherwise be seen as superfluous given your total receipts volume.

Hence a bookkeeper / accountant is quite valuable here. I might even argue more valuable than the $25/month you might otherwise offer to Intuit, but more on that later.

Other accounting software is starting to catch up to Quickbooks, though, when it comes to categorizations. I would assume this is because there are data companies that now sell access to updated merchant categorization lists, and the smaller players can buy in.

So if Quickbooks is losing footing as THE accounting software, what are the other options?

Enter Freshbooks, Wave, and good ol’ excel / google sheets, stage right.

Freshbooks markets itself directly to owner-managed small businesses

They’ve got a fancy website, a great marketing team, and the simple ability to do better than the perceived track-record of Quickbooks (not exactly the highest bar to beat).

But, they’ve also got the price-point that helps them pay for all those things. Starting at $15/month (without accountant access) for “Lite” and $25/month to be able to add your accountant, it’s really more of the same.

My real issue with both Freshbooks AND Quickbooks is that, at the end of the day, you don’t own your data – they do. The minute you stop paying them their $25/month charges, they will close you off to your books – so you’d better download all your years of information before you end your subscriptions with either of these products.

If you closed down your business three years ago, but an IRS audit notice comes in the door, you’ll need to reactivate your QBO or Freshbooks subscriptions in order to open up those digital filing cabinets

Wave Accounting is a truly free application, with modern integrations

Free access for your accountant and bookkeeper, free unlimited invoices to unlimited numbers of clients, direct connections with bank accounts with auto-categorizations of expenses, and unlimited exports of your own data.

Now, something they say about software nowadays is that if you don’t pay for the product, then you ARE the product.

And while this may be true, it’s clear that Wave has learned the value of its own data and is managing to sell that data (non-user-specific) to interested third-parties – possibly Google, Facebook, Bank of America, to name a few. But the thing is, I would bet you Quickbooks and Freshbooks are ALSO doing this – double-dipping so to speak.

The functionality that Wave lacks and Quickbooks offers is Venmo integration. However, the transactions that come from Venmo to Quickbooks do not contain descriptions of the purchases / transfers. From a bookkeeper perspective, 15 emojis that often come with a $350 venmo transaction don’t always paint the clearest picture of why that money was sent, but it is, at least, SOME information.

So at the end of the day, the Quickbooks integration is not perfect. Another thing to consider is that none of the software I mention in this article can connect with CashApp (I think that’s a good sign regarding the privacy of CashApp transactions).

But what about Venmo, CashApp, and other similar payment platforms?

I know a fair number of small-business owners who accept payments through these payment platforms, so it’s generally essential that we can add those to our books!

My workaround solution involves a great piece of modern software called Zapier, and Wave Accounting has built-in, publicized integrations with this service.

Using Zapier, I can parse the data coming from Venmo and CashApp notifications and route these directly to my client’s books!

I’ll spare you the nerding out related to zapier’s automated functions and their benefits for small-business owners (I’m sure that article is forthcoming soon!), and bring it back to the final piece of software I recommended in lieu of QBO (QuickBooks Online) – good ole excel / google sheets.

When used in conjunction with Wave’s auto-categorizations, a well-trained hand using google sheets or excel is able to do masterful work. Pivot tables, conditional formatting, filtered views, formulas and functions, VLookups, and far more allows for the bookkeeping side of things to go to a whole new level.

What this generally means for my clients is that instead of dealing with the headache, nuances, and continual (poorly-timed) updates of Quickbooks, I’m able to spend more time with my clients’ actual books. Armed with my Wave / Google Sheet combo, I can generally complete a monthly-maintenance P&L for a client in the span of 30 minutes to an hour.  With my rates being a reasonable $250 per 10 hours (updated Jan. 2022), this means you’ll very likely end up paying less than a standard Quickbooks Online subscription per month.

All the while, you’ll have more peace-of-mind knowing an expert is looking after your financial information. I didn’t even mention how awful the standard Profit / Loss statements look on Quickbooks.

To learn more about the invoice-side of Quickbooks, Wave, and other services, you can see this article: https://taxguru.ai/best-invoicing-software/

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For small-business or personal-finance inquiries, please email me: daymonet.contact@gmail.com

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Tags: BookkeepingCashAppFreshbooksIntuitIRSLLCQBOQuickbooksSquareVenmoWaveZapier