Your Bookkeeper's Favourite Accounting Software May Not Be The Best Option For You And Your Centre
We often get asked what accounting software is best to use for childcare centres, from managing parent invoices to making payroll, and tracking cash flow and CWELCC funding.
Not all accounting software is made equal, and it's important to remember that these tools should help simplify your operations and help you better understand how the centre is performing. Your accountant or bookkeeper's favourite software may not be the best option for you and your centre.
Your accounting software should integrate with other systems you're already using, and should also integrate with process-improving technologies that can simplify and improve your operations. Many of these tools can save you lots of time and reduce errors (which will also help you save more time and money).
In this post, we'll compare the most popular accounting software options for childcare centres: what they're great at, what they cost, and some considerations to keep in mind. As you consider the right accounting software for your centre, you should also evaluate whether your bookkeeper is meeting your needs and expectations.
Sage 50 (formerly Simply Accounting)
Simply Accounting was rebranded to Sage 50 a few years ago, and offers a hybrid desktop + cloud solution. The user would need to download Sage 50 on their computer, and connect to the cloud for saving data. You would not be able to access Sage 50 without having it installed on your computer.
Pros
Highly customizable and robust platform, often used in industries with complicated operations (e.g., manufacturing) but has gained popularity with larger schools
Cons
More complicated than is necessary for single-location centres, not intuitive to navigate
Limited integrations with other accounting tools
Customer support is not great
Costlier than other options
Cost:
$53.25/month for 1 user, $78.50/month for 2 users
Making payroll and vendor payments through the platform is costlier than other solutions
Best for: larger, multi-location organizations that may need to customize their accounting system to fit their operations.
Quickbooks Desktop
Quickbooks is the most common accounting software in the world, and it all started with Desktop. For many, this is the default solution. Unfortunately, access to live support, add-on services and security patches will be discontinued starting March 31, 2024, for non-subscription versions. Users will be required to upgrade to a monthly subscription plan to maintain these critical features.
Pros
Easy to find bookkeepers familiar with the software
Cons
Can only be access through the licensed user's computer; need to ensure back-ups and security is maintained
Very limited connectivity to other accounting tools
Cost:
Non-subscription version: $350 one-time fee
Subscription version: $47/month for 1 user, $99/month for 3 users
Best for: Nobody! Quickbooks is effectively forcing customers to upgrade to the monthly subscription plan at a cost of $47/month, or accept higher cyber-security risk and no customer support. The price for Quickbooks Online is $48/month [$24/month for ChildcareCPA clients], and it is an all-around better product (see below). It is hard to make a case for staying with Quickbooks Desktop after May 2024.
Quickbooks Online
Quickbooks Online has continued to gain popularity over the last few years, both with accountants and operators. It provides the flexibility of accessing your finances from anywhere, improved reporting options, and enhanced integration with many other technologies.
Pros
Can be accessed from anywhere (no software downloads required)
Significant integrations with other technologies
Easy to find bookkeepers and accountants that are familiar with the software
Cons
In the standard package, customizations are available but are limited (this does not impact most operators)
Cost:
$48/month for 3 users [$24/month for ChildcareCPA clients]
Best for: Centres with 1-3 locations that would like to simplify their accounting and financial reporting and take advantage of additional technologies.
Xero
Xero is a relatively newer accounting software, founded in New Zealand in 2006 (that's new by accounting standards...). It has become a favourite bookkeeping software in Canada, the US and the UK. The software was originally designed for users without an accounting background. Today, it is often considered the most user-friendly and intuitive option.
Pros
Can be accessed from anywhere (no software downloads required)
Significant integrations with other technologies
More user-friendly and intuitive for operators
Cons
Limited customizations available
Cost:
$48/month for unlimited users [Childcare CPA clients can receive a discount of 30-50%]
Best for: Centres with 1-3 locations that would like to simplify their accounting and financial reporting and take advantage of additional technologies.
The best accounting software will depend on your centre's size, your specific needs, and what systems are already being used for centre management (Lillio/HiMama, Brightwheel, Procare, etc.) and payment processing. For example, some systems and technologies will integrate with Quickbooks Online and Xero, but not Sage.
Bottom Line: we find that Quickbooks Online is often the ideal solution for many centres, while Xero is a personal favourite for its usability.
Changing accounting systems does not have to be complicated or take significant time. If you're thinking about making a change, we can take care of the work for you, and set up the tools you need to simplify your operations and give you back more of your time.
If you have any questions or would like to discuss how we can help, get in touch!