The great cloud accounting software search of 2014 (part 6 - the final)

This is a continuation of my search from the previous posts (part 1, part 2, part 3, part 3b, part 4, part 5).

After much effort, I finally arrived at a stand-off between Zoho books or Xero in combination with Freshbooks.

To get to a final decision, I decided to make a list of our various accounting requirements, weight each of these on a scale of 1 to 10 depending on how important the requirement is, then score each of the options on each requirement, again on a scale of 1 to 10.

The requirements I rated against included a long list that I'm not going to bore you with, but will provide a short summary of significant differences. The areas where there were significant differences are listed below.

Areas where Zoho had the upperhand (note that in some of these Xero/Freshbooks also has a solution, but for some reason or other I just found Zoho's better or easier to use):

• Visibility over which projects have unbilled time
• Google apps integrated login
• Consulting rates definitions/setup

Areas where Xero/Freshbooks had the upperhand (again note that in some of these Zoho also has a solution, but for some reason or other I just found Xero/Freshbooks's better or easier to use):

• Export features to Excel/Google docs
• Sending customer statements in bulk
• Automatic exchange rate
• Fixed asset register
• Automated depreciation

Ultimately the combination of Xero and Freshbooks advantages outweighed Zoho and the final score on my whole list of requirements was 1005 for Xero/Freshbooks and 966 for Zoho. It was therefore a pretty close contest, but the bottom line was that Xero in combination with Freshbooks provides a slightly better fit for our requirements than Zoho.

To make the decision a little more difficult Zoho will cost us $24/month whereas Xero/Freshbooks will cost about $240 per month initially, but will grow by $10 per month with every additional employee we add on Freshbooks. I eventually decided to stick with my decision on Xero/Freshbooks though, since I did decide from the outset that as long as I stay within budget, I would prefer a better solution over a cheaper one.

Thus our journey with Xero and Freshbooks begins. 

The great cloud accounting software search of 2014 (part 5)

This is a continuation of my search from the previous posts (part 1, part 2, part 3, part 3b, part 4).

Last night I conducted a standard test of a few typical accounting functions that I would use to further eliminate candidates from my list of Zoho, Xero + Harvest, and Kashflow + Freshbooks.

In the process I realised that there is an additional integration option of Xero + Freshbooks. I had not considered this earlier because for time tracking options with Xero, I had consulted the list of Xero partners in this section on the Xero website where for some reason Freshbooks is not listed. When I looked at the integration settings in Xero there was a section for Freshbooks though, so I decided to add this as an additional option and this brought the list back up to 4.

The standard test took much the same format as my previous test, although I put much less emphasis on time, more emphasis on accuracy, and the tests themselves were invoicing and accounting functions rather than time-logging. The results came in as follows:

• Kashflow + Freshbooks: 22.5
• Zoho: 52
• Xero + Harvest: 50
• Xero + Freshbooks: 53

Kashflow-Freshbooks integration gave me an issue whereby a USD invoice was incorrectly integrated to Kashflow as a ZAR invoice. It should be noted that Kashflow's Freshbooks integration is still in beta. This issue severely affected the score for this option as can be seen above. This is something that we will use regularly. As long as there are other options available that do this properly, the Kashflow-Freshbooks option is therefore disqualified. I have logged the issue with Kashflow so they're aware, but for now I have to move on. If they resolve it shortly or come back with a satisfactory answer (perhaps I was being a doofus) I might reconsider.

I've also decided to disqualify the Xero-Harvest option based on a combination of the above and price. Harvest will work out considerably more expensive (±$200 per month) than Freshbooks (±$60 per month) for our organisation and from the testing I've done so for Freshbooks is a marginally better fit for our requirements anyway. It therefore doesn't make sense to consider the Harvest option any further. Again, nothing bad in Harvest, it just seems in our case Freshbooks will be a slightly better fit.

And then there were two:

• Zoho
• Xero-Freshbooks

To be continued...

The great cloud accounting software search of 2014 (part 4)

This is a continuation of my search from the previous posts (part 1, part 2, part 3, part 3b).

At this point I decided to look in more detail at the user interface and our typical usage pattern around time capturing. A large part of our business is consulting services where we log and bill time to clients. This is therefore something that every employee will use on a daily basis and from past experience we know that this can cause major frustration and disruption to the business if it doesn't work optimally. And of course logging time doesn't exactly add value to our customers so the less time our people spend on this activity the better.

To test this I devised a simple test in three parts as follows:

1. I log in, create two projects with three tasks each, log out.
2. I log in, capture four time entries with different project/task combinations, log out.
3. A colleague logs in on a typical staff account and logs eight time entries on various project/task combinations, then logs out.

For each part of the test, the tester (either me or the colleague) rates the user friendliness subjectively on a scale of 1 to 10 and for each part of the test we also time how long it takes.

We then come up with a combined score for each app that combines our subjective user friendliness ratings with an overall time spent rating. The time spent rating combines the time entries with weighting factors to estimate the total person hours that our organisation might spend on time capturing in a typical month. The user friendliness scores are added together (and in the case of time capturing averaged) and multiplied by a weighting factor representing the number of users who would be exposed to this functionality. We then take the combined user friendliness rating and divide it by the estimated man hours per month spent on capturing to get to an overall score and pick the top 3 from this.

This test revealed some interesting points. For instance, our user-friendliness ratings for Zoho wasn't particularly high, but it did very well on timing, suggesting that our subjective rating is definitely subjective.

I also noticed very quickly that the app that is tested first is at a disadvantage as I got to know the data I was capturing better with each repetition. To counter this effect, we did everything twice and did the second run in reverse order (i.e. if Freshbooks was first in the first run, it would be last in the second run) and then used average time readings.

The end result of this process gave us the following scores:

• FreeAgent: 8.69
• Freshbooks (+ Kashflow): 10.16
• Triggerapp (+ Xero): 2.36
• Zoho: 9.70
• Paymo (+ Kashflow): 8.45
• Harvest (+ Xero): 10.46

You will notice that Harvest scored strongest. Their branding is also orange, so my initial reaction was that I must have been biased. However, my user-friendliness rating for them on the first part was joint-lowest and for the second part was joint in a 4-way tie for second (Freshbooks being the only one that scored higher and Triggerapp being the only one that scored lower), so I don't really think that I favoured them unfairly in any of my subjective ratings.

I should mention that Triggerapp scored particularly low because it seems to be designed on the premise that you will always (or at least the majority of the time) use the timer to start/end time recordings. In our case I don't foresee our users actually doing this. This had a significant impact on our ratings and times as it meant we had to start timer, stop timer, edit time to capture what would otherwise simply have been creating an entry. I'm not sure if we just missed something obvious, but neither of us could find another way of doing this. The app itself actually looked really nice and had some funky ideas, so if the timer start/stop mechanism is your cup of tea it's well worth a look.

To conclude, the top 3 that move on to the final round of my evaluation process are therefore Xero + Harvest, Kashflow + Freshbooks, and Zoho. 

In the next round of evaluation, I'm going to generate invoices from time captured (this will also test the Freshbooks-Kashflow and Harvest-Xero integration) and do some accounting entries that I know we require and that would stretch something that isn't proper accounting software.

The great cloud accounting software search of 2014 (update to part 3)

In the previous post I mentioned 6 options that would work for us, but afterwards realized that Xero + Timely wasn't going to work for our requirements. Timely seems much more geared towards rostering / scheduling, which really isn't our requirement. BTW, Timely looks really neat if this is your requirement, just not what we're looking for at the moment.

[Edit on this post] At first I wasn't sure how this slipped through in the previous round, but later realised that I switched comments meant for Timely and Harvest, two of the Xero time/project management options. So this meant that the Xero + Timely option was replaced with Xero + Harvest.

The great cloud accounting software search of 2014 (part 3)

This is a continuation from this previous post.

In my search for new accounting software, I've not narrowed down the options to four that I feel are viable alternatives, namely FreeAgent, Kashflow, Xero, and Zoho.

However, I need a complete solution that also incorporates time tracking. Xero and Kashflow do not offer this functionality except through add-ons. In both cases numerous add-on options are available, so before the next round of evaluation, I decided to check out the various add-ons and narrow these down to a few usable options so that I can ultimately compare apples with apples.

My next step was therefore to evaluate the various time tracking options available for Xero and Kashflow. In the project / time management categories Xero has 28 add-ons listed on their website and Kashflow 6, with only one common entry. 33 options is a bit too much, so I decided to quickly eliminate options based on a few basic criteria:

1. Eliminate anything that seems overly complex.
2. Eliminate anything that is likely going to push the total solution (with Kashflow/Xero) price over $250 per month.
3. Eliminate anything that does not have a free trial or requires me to enter credit card info to qualify for the free trial.
4. Eliminate anything that clearly won't work (e.g. if it's an Outlook add-on rather than a cloud-based time-tracking app, etc.)

This resulted in quite a quick elimination process with the majority of options falling out on price and eventually left me with 4 options, 2 with Kashflow (Freshbooks and Paymo), and 2 with Xero (TriggerApp and Timely).

Thus, we're now left with 6 options in total:

• FreeAgent
• Kashflow + Freshbooks
• Kashflow + Paymo
• Xero + TriggerApp
• Xero + Timely
• Zoho

Time capturing efficiency is quite an important part of our requirement, so from here I decided to compile a standard time capture test that I will complete with each time capture option and to then proceed with only the best three. I'll cover this in my next post.

The great cloud accounting software search of 2014 (part 2)

This post is a continuation of my search (see previous post here)

After a rather exhaustive googling exercise, I arrived at a list of products that I initially looked at. The list got quite long, so I started to eliminate as I went along by performing these basic checks:

• Does it have a free trial that includes all functionality, or at least all advertised functionality that I'm interested in?
• Does it support multiple currencies? Specifically I checked for the following:
• Supports ZAR as base currency
• Can I, in the trial, create an invoice in a different currency (USD), either by specifying the currency on the invoice or by specifying the currency on the customer record.
• Check if some basic accounting features are supported, especially functionality for deferred revenue and work in progress, even if only through manual journals.
• Price: I quickly realised that I would quite easily be able to find a good enough solution for less than $250 (USD) per month, so anything that would cost more than this based on our expected usage was eliminated.

The majority of the options that were eliminated were eliminated due to multi-currency shortcomings. This doesn't necessarily mean that the software doesn't have any multi-currency functionality, it just means that I could not get it to do what I want it to do within a reasonable time (about an hour) of trying in the trial version. Thus, in some cases elimination on grounds of lacking multi-currency functionality was rather a reflection of usability or trial edition limitations. Regardless, for my purposes, this is sufficient reason to not waste any further time evaluating such options.

Using this procedure I was able to eliminate the majority of options. I have to mention that some of these looked like really great software, but for some or other reasons simply didn't fit our requirements. This does not mean that it's bad software, it might be a much better fit for someone else. The full list in the order in which I evaluated them: Freshbooks, Xero (still in the running), Clearbooks, Kashoo, Kashflow (still in the running), Acumatica, Sage One, Intacct, Zuora, FreeAgent (still in the running), Quickbooks online, Netsuite, Outright/Godaddy bookkeeping, Big Red Cloud, Bean Cruncher, Zoho books (still in the running), Saasu, SMEasy, Bluubin, PingAccounts/CapitalOne.

Thus, I'm left with four options that I feel could do the job:

• Xero, www.xero.com
• Kashflow, www.kashflow.com
• FreeAgent, www.freeagent.com
• Zoho books, www.zoho.com

In both Kashflow and Xero's case some kind of time tracking add-on may be necessary too, but both of those seem to have a generous number of add-ons available. Although this adds extra cost it still looks like most combinations will be significantly cheaper than some of the more expensive options I evaluated and hopefully still well within my $250/month limit.

I'm now moving on to a next round where I'll compare features and usability against our requirements in a bit more detail and hopefully arrive at a final answer shortly. Although the available options may be quite varied in pricing I'm not too worried about price at this stage. As long as the price remains within certain limits (like $250/month), finding the best fit is a much higher priority than saving a few bucks.

The great cloud accounting software search of 2014 (part 1)

Exciting times as we're moving into a new phase of Xpedia's history and I'll hopefully be posting more often in the near future. As a starting point I'm going to document my search for new accounting software here.

I'm looking for a better accounting solution for Xpedia's applications division. Going forward this will be a separate legal entity that I will lead. Our current software is Acumatica, which is a very feature rich ERP suite. We host it ourselves, but it is completely browser-based so I've become spoilt with having something that's always available from anywhere. The only problem with Acumatica is that it is complete overkill for our requirements. This means the processes are too cumbersome as we don't have dedicated staff who can specialize in a single discipline/module like debtors clerks etc. When you have the staff to use Acumatica properly I think it would be a fantastic product to use, but we're simply not there yet. It also means the software is a little pricey. The Xpedia Applications business has a headcount of 20 and annual turnover in the R5 000 000 to R10 000 000 range (that's roughly $500 000 to $1 000 000 in USD), so a full-blown ERP is a little bit out of our league.

So for part 1 I'm going to list requirements and hopefully get some additional ideas on this and from part 2 onwards I'll expand on our search, the products we've looked at and the process to evaluate and arrive (hopefully very shortly) at a conclusion.

Here's a list of features we need:

• Cloud-based, hosted by provider
• Easy to use. Everyone always says that, I know... But it must have a free trial so I can check it out first hand and see if I find it easy to use.
• Must support South African Rand (ZAR) as base currency for our business.
• Must support multiple currencies (i.e. I want to be able to send a client in Mozambique or DRC a USD invoice instead of a ZAR invoice).
• Must support recurring invoice items (we have lots of clients with monthly retainers or recurring software license fees)
• Must support recurring cost items (e.g. recurring software license fee costs, our own retainers to suppliers etc.)
• Must support fixed asset depreciation, revenue deferral, work in progress, even if only through manual journals.

Nice-to-haves:

• Banking integration (we will use an First National Bank of South Africa account)
• Time tracking
• Support ticketing
• Project management
• Departmental transactions and reporting (not that we really have departments, just want to keep track of profitability of different products and services separately and traditionally something like a departmental breakdown appears to have been the easiest way to achieve this)