Product Comparison: Tough Accounting Choices for Small Businesses

With both <="" a="">Intuit and Microsoft offering accounting applications for small businesses, it may be difficult to decide which will work best for you. We have reviewed both applications separately (Intuit's QuickBooks here and Microsoft Small Business Accounting (SBA) here) and concluded that although they each have their strengths and weaknesses, both are viable options for many small businesses.

However when comparing them to each other, QuickBooks' maturity is apparent in its depth of options. One surprising advantage that QuickBooks 2006 has over Microsoft Accounting for Small Business is the way its contact manager is integrated with Microsoft Outlook.

The similarities

Microsoft may be new to the small business accounting market with this product, but it obviously knows plenty about software. And while Microsoft SBA 2006 is a new product, it has plenty of features and a good user interface. It sells for a very reasonable $179.

QuickBooks 2006 is a mature product in its own right with years of usage history and millions of user comments, and sells for $199. Its newest iteration sports a revised user interface that combines what the company has learned over the years into a flexible user experience.In fact, both Microsoft's SBA and QuickBooks 2006 offer options for configuring the user interface--with varying success. I like the way SBA allows the user to add or remove items from its dashboard, but the list of available items is far too restricted to call it "customization." QB 2006, on the other hand, has always had too many ways to get to the same function (menu bar, task list, task history, etc.) but it's possible to turn off the ones you don't want to use.

Both applications offer those new to accounting applications a simple startup wizard that takes the user through an interview, helping the user to enter required information in the proper places.

Although prior versions of QB required the user to enter more information than was necessary to start using the program. With its latest version, QB2006 requests only the basic information necessary to start using the program. Adding more information about customers, vendors, bank accounts, and other financial information can be done on the fly in both programs during the course of using the software.

While both QB 2006 and SBA have the basics covered more than adequately with regard to accounting and reporting, there are some significant differences with regard to usability. In this case, QB's maturity gives it the advantage in several areas.

SBA segments its operations into individual activity areas like Customers, Vendors, Employees, or Banking. Selecting an area displays its related workflow diagram that does a nice job of presenting the relationships between the various functions available in that activity area.

Previous versions of QB segmented its functions similarly, but customer feedback indicated that the relationships between the different areas remained unclear to many. QB2006 shows a workflow diagram of the entire application, showing how, for example, the Customer module relates to the Banking module making it easier for novice accounting staff to maneuver the system.

When you're dealing with your business' accounting, you're invariably also working with your customers and suppliers. The contact information for those companies is likely to reside in your address book in Microsoft Outlook. In addition, the reports produced by the accounting application are often not formatted exactly as you would like them to be, and the information in them may need to be used in different ways, or combined with additional information.

To that end, both SBA and QB 2006 offer integration with external applications like Microsoft Word and Excel, and some way to leverage your customer information by way of linking it to your Outlook address book. But there is a big difference in the level of integration achieved by these two programs, and the result is not what you'd think. It turns out that QB 2006's implementation of its contact management system is more interactively connected to Outlook than SBA's by way of offering bidirectional data updates.

QB 2006's contact manager can directly update to and from Outlook while SBA connects with Microsoft's Business Contact Manager (BCM) CRM application rather than directly with Outloook. The problem is that Microsoft's BCM can only extract information from Outlook, which removes the contacts from Outlook and stores them in BCM. From there, SBA and BCM can share information, but it is in a separate database from Outlook's contact list.

Also, it's quicker to generate reports in QB 2006, which displays your requested report immediately upon selecting the option. SBA displays a static mock-up of the report, showing its format, but not its actual content. Selecting the report to be generated does produce the report as specified, but overall the performance is slower than that of QB2006.

If you're using an accountant to work on your accounting, both Microsoft and QuickBooks have programs in place that make it easy for the accounting professional to get involved. However, QuickBooks has over 200,000 accountants already familiar with their product, making it likely your current accounting professional already has QuickBooks installed.

And keeping in mind . . .

Whether you select Microsoft Small Business Accounting or QuickBooks 2006 you're sure to get your bookkeeping done, and done right. Both products offer great support from solid companies. And as with all software, both will continue to mature, so many of the comparative shortcomings of SBA are likely to be resolved in future releases.0