Sunday, July 26, 2009

A Comparison of QuickBooks Online Basic to QuickBooks Online Plus

QuickBooks Online has three levels of online accounting choices: Simple Start(free version), Basic, and Plus. Before making your decision to use QuickBooks Online, you should decide between QuickBooks Online Basic or QuickBooks Online Plus. This article will discuss the differences between these two QuickBooks Online options. Ultimately, you are responsible for ensuring that you select the correct version which should be tailored to the business that you operate. There is also a free version called QuickBooks Online Simple Start. The free version was not considered for this analysis because of its limited capabilities. QuickBooks Online Basic will be collectively referred to as "BASIC" and QuickBooks Online Plus as "PLUS". Each major difference and brief comment regarding the option's capability is discussed below. The following article discusses the capabilities that work only with PLUS.

Importing -Plus allows you to import your Simple Start Edition, QuickBooks Online Basic, QuickBooks Pro or Premier Edition file(s) into PLUS only. Unfortunately this import feature does not work with a Mac.

Estimates - Estimates are important to avoid misunderstandings and can be created and then seamlessly imported to an invoice for billing. This feature is only available in PLUS.
Online Banking - Payments and receipts do not have to be entered into your QB register when you use Online banking. Instead of entering then, you only have to review them. When you download from your bank, QuickBooks is able to compare the bank's transactions to your transactions in QuickBooks and identifies differences. Plus assists you in managing your cash flow, because you know which checks have cleared the bank, which helps you understand how much money you have in real time. This feature is only offered in PLUS.

Exporting - With PLUS you can export transactions and balances to a Microsoft Excel spreadsheet. This feature is critical for further analysis of your business.In other words, you can derive information otherwise not easily available to you. It's an important feature, that should not be be overlooked, since it adds greater reporting and after the fact analysis capabilities.

Class tracking - Within Plus classes provide a system for categorizing transactions that goes beyond the normal ways of assigning transactions to expense or income accounts. With classes, you can categorize each detail line on a transaction. This lets you write one check to the office supply store for items bought for two different business units and still track the business unit for those purchases. For example, suppose you have a consulting business and an installation business. Class tracking is ideal for you if it is typical to have purchases and sales that include both types of work. By specifying the appropriate class on each detail line, you can run a Profit & Loss by Class report that will tell you if your consulting business is more or less profitable than the installation business.

Business tracking - This feature is only in PLUS. You can use businesses to categorize data from different locations, offices, regions, or outlets of the same company. By assigning a business to each transaction as you enter it, you can later see businesses on reports. Assigning businesses also lets you efficiently manage groups of transactions.

Time tracking - With Plus you can enter your time into a time sheet when you bill by the hour i.e. consultants, website developers, SEO's, freelancers, sole proprietors, etc. This feature is only offered in PLUS.Invoicing - Adding fields to track more information on transaction forms is only in PLUS. You can create your own custom fields to include on sales forms.

Reporting and Financial Statements - BASIC provides 40 standard reports whereas PLUS provides over 65 standard reports plus customization and formatting. A comprehensive analysis in a chart format of the reporting differences can be found at Intuit's knowledge base for comparison of the QuickBooks Online Products.

Budgeting - You can use a budget to estimate future income and expenses. Moreover, PLUS budgets' uses a format similar to a spreadsheet, with a horizontal row for each of your income and expense accounts, and vertical columns for each month or quarter. This feature is only in PLUS.
1099 Reporting - The regulations of the Internal Revenue Service require that a taxpayer issue a 1099-MISC form to its workers for nonemployee compensation providing the payer is a trade or business and the payments are to a noncorporate entity were $600 or more for services rendered. This feature is only offered in PLUS.

Number of Users -BASIC provides access for one person and your accountant (2 users). However, PLUS provides access for 3 users PLUS your accountant for a total of 4 users. Plus can be expanded to 25 users for an additional cost, which is reasonable.

QuickBooks Support Services - BASIC includes support by email which is provided by Intuit as compared to PLUS support which includes callback and chat support and email support which is also provided by Intuit. PLUS support is better, but with BASIC you can resolve your questions by email.

Pricing - BASIC costs $9.99 per month as compared to PLUS which retails for $34.95 per month . However, if you purchase PLUS through a Certified QuickBooks ProAdvisor you can purchase it for $21, which reflects a discount 40% discount, which is currently in effect at this time. Discounts and prices may vary in the future.
Summary - BASIC works satisfactorily for smaller companies, whereas PLUS works well for small to midsized companies. Prior to making your decision, you can test drive the software for 30 days for either or both BASIC and PLUS and, then decide which is the best software platform for your business. They are other disadvantages when considering BASIC and PLUS to a Desktop QuickBooks i.e. Pro, Premier, etc. The most significant disadvantage is that the Online versions do not provide inventory functionality. You may be able to overcome this disadvantage by purchasing an inventory add on. Prior making a decision of software selection its important for you to have a discussion with your CPA or accountant concerning which QuickBooks Online accounting package is best suited for you and your business.

Learn how QuickBooks Online provides the essential online accounting tools to manage your business and the freedom to access your financials from your office, home, or the on the road,. Sandor Lenner, C.P.A. has provided accounting services for over 35 years. He is also a Certified QuickBooks Pon the road,visor and your offices as a part-time consultant for a Miami Accounting CPA firm.