There’s so many options available for the business owner who wants to take care of their own books. For some users, it’s a matter of price while others look more toward functionality and integrations.

I think it’s important to look at it all, especially what you need within your own business. Because no two businesses are created equal.

Let’s take a look at the difference between Wave and QBO, and you can decide which is the best bet for you. (Can you guess which is my go-to pick?)

Pricing

I know a lot of business owners are price-shoppers. While I don’t blame you, it’s important to still do your research. I believe you get what you pay for, which means that “free” isn’t always the best bet if you’re looking to cut costs. It just might cost you more in the long run if it doesn’t offer all the features you ultimately need.

• QBO: Three pricing plans, depending on the features you need, starting at $10 a month
• Wave: Free, with additional paid services for payroll and online payments

I know a lot of business owners are price-shoppers. While I don’t blame you, it’s important to still do your research. Click To Tweet

Integrations

How well does your bookkeeping software “talk” to other systems? In today’s ultra-connected world, your systems need to speak to one another to be more efficient–saving you time and money and ensuring that human error isn’t part of the equation.

• QBO: 1,000+ with both Zapier and stand-alone integrations
• Wave: Three – Etsy, Shoeboxed and Paypal only

Security

You’re dealing with bank feeds and log-ins that needs to be secure. Having something you can depend on, without the risk of your sensitive information falling into the wrong hands, is important.

• QBO: Data encryption, backups and physical security
• Wave: Data encryption, backups and physical security

Setup

This is the most important step, besides making sure the accounting program has all the features that you need based on your business type. If the program isn’t set up right from the beginning it will affect the accuracy of the data on your reports.

• QBO: Setup in QBO is intense but straightforward if you watch the training and setup videos or have a professional help you. Expect to spend anywhere from 1 to 3 hours setting up QBO the first time. Another option is to have a professional set up your file. Then, purchase a block of training hours for particulars in the beginning.
• Wave: Easier setup than QBO but still a learning curve. It might be best for a professional to help you set it up and give you some training. It will take roughly 1 to 2 hours for setup depending on the level of detail in how want to categorize your income and expenses. Wave has a great help section of webinars, videos, and guides.

Accounting

I recently wrote about cash vs. accrual accounting, a distinction that’s important for small business owners. Because many small businesses start with cash accounting, it’s important to have that option in your bookkeeping and accounting software. Only one of these systems does.

• QBO: Offers both cash- and accrual accounting options plus a slew of reports
• Wave: Only allows for accrual accounting

Reports & Features

Every business is different and a bookkeeping system should be able to grow with it. While you may not use all the features of a robust system early on, having access to inventory control, budgeting and tax support options is helpful as your business grows and matures.

• QBO: Offers the above features, plus up to 75 different reports
• Wave: Has 12 available reports, which are basic reports in QBO
• QBO: Has an inventory option, category tracking and budgeting
• Wave: Does not offer inventory, category tracking or budgeting
• QBO: Has a reconciliation feature
• Wave: Does not have a reconciliation feature
• QBO: Can exclude transaction(s) but, not delete them
• Wave: Can exclude + delete transaction(s)

Every business is different and a bookkeeping system should be able to grow with it. Click To Tweet

If you are planning on hiring a bookkeeper anytime soon you’ll want to do some research and find someone that works with the accounting system you’ve chosen, for both bookkeeping and training needs you might have. Find one to three professionals and schedule a free introductory call with them to discuss your options, what you are considering and why. They’ll also give you valuable information to consider in your decision making process as well. Keep in mind, professionals are biased as we are typically used to using certain programs and have our favorites. Here at Number Nerd we use a variety of programs for clients for various reasons. Feel free to schedule an introductory call with a Number Nerd professional to discuss your software options based on your business type.

I’m sure it’s so secret that QBO has long been my go-to favorite bookkeeping system for any client. It just makes sense to have the most streamlined options, and at a reasonable cost. Here’s a Wave comparison chart to the various versions of QuickBooks Online. Other things to consider when choosing a system is the learning curve and trainings available. And as you grow, you’ll want to know the best way to transition from one system to another. Of course, I think QBO is powerful enough to use with nearly any size business.

 

When you start using a new tool in your business, it takes time to learn all the ways it saves you time and money. There are often little tricks hiding in the depths of the tool that you don’t find out about until months later–because you’re really just trying to get it up and running.

This is true for QuickBooks Online (QBO) and its features, especially when business owners start to use it without taking the time to set it up and learn what it’s all about.

There are so many features in QBO that it’s my go-to bookkeeping system of choice for any client. But you have to be willing to take the time to set it up right if you’re going to make the most of it.

If you’re investing in a tool for business, set it up right so you can make the most of it. Click To Tweet

Here are some of my favorite features that often get overlooked by business owners who choose to DIY their QBO set-up:

Connecting Bank Feeds

From time to time, I meet with potential clients or new clients that are not utilizing the bank feed feature at all. Either they are stuck in the old-school way of doing things or simply are not aware that QBO has this feature and the purpose of using it.

It’s the simple task of connecting your bank and credit cards accounts in QBO. And yes, that means entering your login credentials for that site into QBO and mapping that account accordingly. It is a bit scary for the non-tech savvy business owner but, once I explain it and the amount of time it will save them, they are sold.

By connecting the bank feeds you’ll see new transactions download every time you log in. You’ll see your QBO populate with each and every transaction, saving you time and limiting the chance of error.

Categorizing Transactions

QBO will automatically categorize, or code, your transactions for you–if you take the time to set up the bank rules. Doing this saves you the time of manually categorizing when you reconcile your accounts. Keep in mind you will need to invest time to do this when you first setup your QBO and each time you add a new bank or credit card account.

If you’re not setting up rules in QBO, you’re losing a lot of time categorizing manually. Click To Tweet

Without rules, QBO will try to categorize your transactions for you. And while it can often do this correctly, keep in mind that QBO is not a human and doesn’t always know what each transaction is for. It’s up to you to correct the categorizations and create rules to help QBO do a better job next time. Yep, this takes time. But it’s worth it in the end!

Account Reconciliation

You need to know where you stand financially at any given moment. When you connect your bank feeds and set up categories in QBO, reconciliation is a cinch. It’s a matter of verifying your month end statement bank balances from each bank and credit card at month end against what was recorded in QBO. This bookkeeping task is a must-do at the end of every month.

You are probably wondering, why–what’s the purpose?

Well, you want to ensure that the bank feed didn’t have a glitch and inadvertently download 2 of every transaction or skip a few. If that happens it means that your expenses are overstated and less profit in your business. Another common issue I see is overstated income, by recording customer payments twice. This happens when you use the receive payment feature and add the bank deposit in the bank feed. That means you’ve counted it twice and overstated your income. Whoops! Both overstated income or expenses are a problem and ultimately affect the business bottom line and the amount of tax you pay. So, it is a good idea to ensure the numbers are correct by using the reconciliation feature.

Time and time again I see plenty of clients that come to us for help and don’t understand why the numbers don’t make sense. Unfortunately, too many business owners skip this vital step–reconciliation–costing them loads of time later in the year. Hopefully, your CPA checks to ensure you have completed your bank reconciliations before they prepare your tax return. This step ensures the accuracy of the data they are using to prepare your return.

QuickBooks Online is truly my go-to bookkeeping tool of choice, and it’s simple enough for any business owner to use. But if it’s not set up correctly, you’re likely to get frustrated and turn to less intuitive and robust systems.

If you’re using QBO and want to get a better handle on how to fit it into your weekly bookkeeping tasks, grab my Weekly Workflow Template today! If you need help now check out our Support and Training packages and let’s chat.