If your budget is tight and you're tired of dealing with crash-prone accounting software, you might want to take GnuCash for a spin. Here are some of the best ways to take advantage of this open source solution.
If you've spent enough time giving Intuit's QuickBooks a go, you know how frustrating that software can be. And most other solutions are either too expensive, too convoluted, or simply don't work. But there is one option many overlook in the search for an accounting package for their business — GnuCash.
GnuCash is an open source, cross-platform, double-entry accounting package that offers many of the features found in typical accounting packages, along with some features not found in typical software. But how do you make GnuCash work for your business? Although every business is different, requiring different solutions, there are ways to make sure GnuCash can serve as your accounting software so you don't have to shell out the cash for costlier solutions or deal with the headaches of buggy, crash-prone apps. Let's examine five ways you can make GnuCash work for you.
1: Create the right account
When you run GnuCash for the first time, you are asked what type of account you want to create. Your experience with this software will be worlds easier if you create a business account and not a common account. During the first run, in the Choose Accounts page, select Business Account from the Account Types section. You can select multiple types of accounts (CD and Money Market, Fixed Assets, Home Mortgage Loan, Investment Accounts, etc.), but you must at least choose Business Account. This will include Accounts Receivable, Current Assets, Equity, Expenses, Income, and Liability categories.
2: Take the time to set up your business
Just like any other accounting package, you need to make sure your customers, vendors, and employees are in place before you begin your daily use of GnuCash. This will make it infinitely easier to create invoicing and reports. But during the setup of your vendors and customers, you will notice other configurations that must be taken care of. To make the most out of customers, vendors, and employees, you will need to create a tax table and terms. You can create these by clicking either Business | Sales Tax Table or Business | Billing Terms Editor. You will also want to set up your Tax Report options. (Click Edit | Tax Report Options.)
3: Make use of the built in online banking
That's right, GnuCash does have online banking functionality. There is even a handy wizard that will walk you through the setup. For online banking with GnuCash, you'll need the bank code of your account, a user ID that identifies you to your bank, the address of bank's online server, and (if using HBCI online banking) information about the public key for your bank. The actual setup of the online banking is handled by an external wizard (AqBanking). This wizard can connect with either an HBCI backend (Europe) or an OFX DirectConnect backend (U.S.). If your bank doesn't support either of those, you won't be able to use online banking in GnuCash.
4: Use the reporting features
GnuCash can generate a substantial number of reports for your business. From Assets & Liabilities, you can generate reports such as Advanced Portfolio, Asset Barchart, Asset Piechart, Average Balance, Balance Sheet, General Journal, and General Ledger. From the Business category, you can print reports such as Customer Report, Customer Summary, Easy Invoice, Employment Report, Fancy Invoice, Payable Aging, and Printable Invoice. From Income & Expense, you can print Cash Flow, Equity Statement, Expense Barchart, Expenses vs. Day of the Week, Income Barchart, and Profit & Loss. You can also print Budget, Account Summary, Custom, Future Scheduled Transaction Summary, Tax Schedule Report, and Transaction Report.
5: Enable Extra buttons
If you go into Preferences and then click on the Business tab, you will find a check box for Enable Extra Buttons. When you select the check box, you'll see a button for New Invoice. With this feature enabled, you can easily create new invoices for your customers. Although this may not seem like such a big deal, without this enabled, you will spend a lot more time creating invoices for customers. Oddly enough, that is the only extra button that appears. But it will save you a lot of time at the end of the day. This also brings up one extra tip: Make sure you carefully go through the preferences before you start using GnuCash for your day-to-day business. There are a lot of options to configure, and some of them can make a large difference with regards to running your business. For example, you'll certainly want to enable auto-save, which is done from within Preferences | General.
I have been using GnuCash for years and have never had a problem. Although GnuCash doesn't currently offer a multi-user setup (I believe this is under consideration), GnuCash can easily be put in place to handle your businesses accounting needs.
Have you discovered a GnuCash tip that helps make your business run smoothly? If so, share it with your fellow TechRepublic readers.