Knowing your company’s financial status is one of the most important components of running a business.
You could be losing money if you do not really know how your firm is doing financially.
Therefore, in order to better understand their corporate finances, organizations have begun to use accounting software such as QuickBooks. What about Excel, though?
Look at the fundamental differences between QuickBooks vs Excel for small businesses.
Quickbooks for Accounting
QuickBooks was released by Intuit in 1998. Its goal was to make it simple for small business owners to optimize a variety of business operations.
It was immediately praised by small business owners with accounting backgrounds after its launch. QuickBooks, on the other hand, was first criticized by accountants due to its lack of safety and general sturdiness.
By the year 2000, Intuit had updated QuickBooks to include many of the features that early reviewers thought it lacked.
Packages were also created to cater to specific businesses, such as retail, production, and non-profits.
Advantages of Quickbooks
- QuickBooks is very user-friendly; it was designed with the intention of being used by all small business owners (including those without accounting experience).
- Previous accounting software’s serviceability issue is no longer a concern. QuickBooks, like many other bookkeeping software options, can be utilized from any contemporary device.
- New additions are introduced on a regular basis, and the software’s range and abilities are growing exponentially.
- QuickBooks can help with predicting and budgeting by tracking past data. In the present atmosphere, having an audit trail for your business may be necessary. This job is included in the main functions of modern accounting software.
- You may view your books and financial information at anytime from anywhere in the world with current accounting software. The office isn’t the only place where you can do business. All you need is a basic login to use QuickBooks.
Disadvantages of Quickbooks
- The audit trail in QuickBooks is one of the software’s major flaws. Accountants and entrepreneurs prefer a company’s financial information flow to be detailed and well-documented. Although most data in QuickBooks have an audit trail, there are few instances where financial data can be modified without generating any evidence.
- Another possible problem, based on how a client utilizes the software, is that QuickBooks does not include a fixed-asset component. As a result of the error, Intuit now offers a separate report that lists a company’s fixed assets.
- There are a lot of expensive updates that small business owners may have to buy in order to maintain the software up-to-date. In order to obtain the best up-to-date payroll figures and other services, these upgrades are usually only needed once a year.
Excel for Accounting
When comparing QuickBooks or Excel, Excel has been a favourite since the 1980s.
Due to advancements in automated assisted reporting, spreadsheet programs increased in popularity in the early years.
After a few years, Microsoft introduced Excel as a competitor. Excel was highly received by the general public since it was easier to use and provided more calculating alternatives.
Its popularity grew as a result of its inclusion in Microsoft’s Office Suite, notably because of its capability to mechanize complex operations using formulae.
Advantages of Excel
- Enormous-scale data analysis: MS Excel spreadsheets improve your ability to evaluate large amounts of data.
- It includes several analytical tools for analysing big amounts of data accurately. It will be easier for you to obtain the essential information and will assist in your judgments with strong filtering and sorting capabilities that allow you to sort out a big volume of data. Filtering also helps to save time and effort by removing redundant data.
- Easy data storage: MS Excel makes it simple to save data, run calculations, format cells, and alter layouts in order to generate output and reports that can be shared with others. Many templates make it simple to complete a variety of activities.
- Data Visualization: It enables you to build a visualization of information and data. Bar charts, column charts, and graphs can be used to visually present the results.
- For further security, Microsoft Excel files can be password locked. Inside the Excel file, a user can create a password.
Disadvantages of Excel
- Excel was not created with any particular process or train of thought in consideration (such as accountancy). Unlike bookkeeping software, Excel requires you to construct your own procedure, which for many small businesses can be complicated and counter intuitive.
- Loss and profit sheets are generated by bookkeeping software like QuickBooks. When using Excel, however, you must create such a report by hand.
- Excel contains a lot of formula possibilities, which can be a drawback for individuals who don’t know how to utilize them properly.
- Excel does not allow you to receive or send invoices directly. You’d have to integrate or utilize a different system.
- Working with Excel is problematic for accounting professionals. They frequently have to enter Excel data into bookkeeping software such as QuickBooks.
- It isn’t a long-term accounting tool. Whereas an Excel sheet can be quite beneficial for data analysis, it is not a tool that should be used on a regular basis. Data analysis becomes more difficult as the data increases over time.
QuickBooks vs Excel for Small business (VERDICT!!)
When we compare QuickBooks vs Excel, we must keep in mind that Excel isn’t an accounting software.
Though it can help you with accounting it cannot be considered as whole dependent accounting software like QuickBooks.
Excel is a spreadsheet-based tool, and spreadsheet-based programs aren’t the easiest to use. They’re out-of-date and potentially difficult for your business.
Using the current tool sets that QuickBooks and similar software bring to the metaphorical accounting table, on the other hand, can potentially speed up your business. When it comes to QuickBooks or Excel and which one will sustain and expand your business, we recommend QuickBooks.
So, this was all about QuickBooks vs Excel for small businesses. If you are confused about what kind of software you should go for your small business then this article will definitely help you in getting better insights.