Lessons


LessAccounting Review

How this review works

Note: For an up-to-date review and comparison of online accounting software, please check out my ebook.

This LessAccounting review was done by me, Greg Lam. I own the Small Business Doer website and my goal is to help small business people. The review is my own personal opinion and I was not paid by the manufacturer to write it.I've been a small business owner since 1998. I have a degree in business from Simon Fraser University in Burnaby, B.C. (Canada). I've been doing bookkeeping for myself and others since 1998, primarily with QuickBooks. I'm also a certified QuickBooks Pro Advisor.I am currently comparing various online accounting software and will write a review on each of them as I go along.This review of LessAccounting was written on June 29, 2012. The date is important to note, since software changes so quickly.I spent the a total of 2-3 days using the software and writing this review. I imported a trial balance ending December 31, 2011 from my QuickBooks Accountant Edition 2012 Desktop software. From there I entered and reconciled all the transactions for one month. There were some things (I wasn't 100% satisfied with), since I'm based on an accrual accounting system whereas LessAccounting really is a cash based system.This review is not just an assessment of LessAccounting's strengths and limitations, it's also meant to be a best-practices guide. I've decided to include all the notes that I created as I used the software myself to enable potential users to follow along, see the errors I made and to benefit from my own discoveries.If there is anything that I've said that is inaccurate or false, please let me know so that I can update the article.Enjoy!

Topics

  1. introduction
  2. user interface
  3. accrual accounting
  4. double-entry accounting
  5. chart of accounts
  6. reconciliation
  7. importing and syncing data from bank
  8. data import
  9. data export
  10. auto entry of data
  11. reporting
  12. taxes
  13. document attachment
  14. multi-currency
  15. invoicing
  16. payment processing
  17. payroll
  18. inventory
  19. integration
  20. mobile app
  21. other features
  22. support / help documentation
  23. improvements
  24. country it's made in
  25. price
  26. recommendation
  27. setup and walk through notes

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introduction

You can look at LessAccounting (it's all one word by the way, it's and not a typo) at http://lessaccounting.com/.In order to sign up you have to enter your credit card, which is not a big deal… unless… you're like me and take 3 months to review. Since the monthly charge is $30 a month, I paid $90 to review the software. That's my fault though, since every time I saw the charge come through I thought to myself, "Ok, I'm going to review before the next charge". However, the next month would end up coming around without me having done a review.Any case, with LessAccounting you can get set up quickly and easily.LessAccounting is based out of Jacksonville, Florida in the United States. There's no trial version, but you can check out their demo version at https://demo.lessaccounting.com/dashboard. They target small businesses with 20 employees or less.The biggest feature that LessAccounting likes to talk about is how their application allows you to connect to your bank accounts and credit cards to enable you to import transactions. They offer free setup as well, which is nice for first time users. And they also like to boast how they're more awesome than QuickBooks.Ultimately, though, their goal is to help users cut down their bookkeeping time to just one hour per month.For importing my data, I started off by attempting to do it directly through their QuickBooks import feature. After a few technical issues, I thought it would be much more efficient to do it the manual way.go back to top

user interface

One thing I like about the LessAccounting interface, is that it has a lot of help built right into each page. For example, check out what shows up when I go to Bank Accounts.

built in help

built in help

I would like is if this built-in help didn't disappear once you start using a feature. Perhaps it's a good thing that it disappears, since it's less annoying to regular users... but I'd rather see it minimized or hidden under an arrow or question mark.The navigation menu stays put on the left hand side, which is something that I like. It makes the learning curve easier since you don't have to remember where to find things (well mostly, since they do make tasks disappear and place certain items under drop-down menus).
navigation bar on left hand side

navigation bar on left hand side

One of my pet peeves is that I can't see what I'm typing while searching a drop-down box. It's not a massive deal, but it's still a bit annoying, nonetheless.
can't see what I'm typing

can't see what I'm typing

If you have to leave a window to look something up while you're in the middle of data entry (say, entering an invoice), all your data disappears. I've seen other software deal with this a lot better by allowing multiple windows to appear (QuickBooks Desktop) or auto-saving your half-entered data (Kashoo).One advantage of LessAccounting is that it remembers the items you've typed in before when you're creating an invoice. However there is no "add item" function.
LessAccounting remembers your items

LessAccounting remembers your items

LessAccounting is a bit slow in remembering your invoice items (it takes maybe a second or two). Just use the drop-down boxes which work much faster. This would seem like a good way to easily - and intuitively - add items but there are a few potential drawbacks:

  1. You might end up with a massive list of items, since LessAccounting records every price and quantity variation that you use.
  2. There's no way to edit the items that I can find, which means, if you incorrectly enter an item, it will always show up as an option.
  3. It also means that you can't give items any attributes (e.g. such as linking it to an income account or a tax account). In fact, there are no income accounts in LessAccounting, which I find odd).

Search / finding data

Being able to find your data easily is nice. This is actually quite an important feature since I find bookkeeping to be an investigative type of job. The more powerful your search capabilities, the faster you can work.In LessAccounting, it was fairly easy to find what I was looking for, since most windows are accessible from the navigation bar on the left hand side.The reports also have decent drill-down capabilities, where you can click on items to get more information.

Tracking changes / undo button

Being able to track what someone else has done is important for auditing and investigating how data was entered and manipulated. I use it more for those "how did this happen" (rather than "who did this") moments, which enables me to fix these .Another useful software function is the ability to undo a mistake or to redo something that you accidentally deleted.I noticed that tracking changes or undoing an action wasn't possible with LessAccounting.

Duplicate Buttons

Duplicate buttons are not necessarily a bad thing, but I noticed that if I go to DATA & SETTINGS > Settings > Bank Accounts it takes me to the "Bank Accounts" part of the software. Why have this button then? I do understand that setting up your bank account is a setting, but so is setting up contacts, and that's not under settings.go back to top

accrual accounting

Accrual accounting is like the grown up bicycle, while cash accounting is like the training wheels on a child's bike. Eventually, you'll want to (and need) to use accrual accounting.So can the software accommodate this?Unfortunately, LessAccounting is a cash-based accounting system. Although it has an option to switch to accrual accounting, it doesn't quite behave like your typical accrual system would.For instance, you can't enter a bill on one date and pay it at a later date. It's possible to do it, but the transaction date ends up also being the payment date, which happens in cash accounting but not in accrual accounting.go back to top

double-entry accounting

Having a general journal entry window lets someone who understands bookkeeping or accounting quickly add transactions and make modifications to the books. This is an extremely essential feature that your bookkeeper or accountant would be glad to have.LessAccounting practices double-entry accounting. However, I couldn't find any way to do general journal entries, though, so this is probably a big red flag for a lot of accountants.With the way LessAccounting is built, this makes it very difficult or impossible to move over an existing set of books to LessAccounting. For example, how do you transfer over your account receivables and payables (answer: re-create the invoices and bills)? Or assets (answer: create an expense and call it a capital asset)? There are workarounds for some things, except that I found myself spending more than half my time on creating these work arounds, which wouldn't have been necessary if there was a journal entry window.go back to top

chart of accounts

In case you didn't know, a chart of accounts is a listing of all your accounts (Income, Expense, Assets, Liability, and Equity). Some software I've reviewed doesn't allow you to see your entire chart of accounts on one page.Something you should look for is if you're able to freely change and create your chart of accounts. This is a core need for accountants and bookkeepers.Something I found peculiar in LessAccounting was how it named things. For example, the Chart of Accounts only has expense accounts (no income, asset, liabilty, or equity accounts).To get those, you have to open up different reports, such as the Balance Sheet and Profit and Loss.There's no real chart of accounts in LessAccounting. You can't create asset, liability, equity or income accounts. This severely limits the capabilities of LessAccounting.go back to top

reconciliation

Reconciliation, or the process of matching transactions in your bank statement to transactions in your accounting software, is a crucial step in the bookkeeping process. This is because it verifies the data you've entered into your books.LessAccounting has the reconciliation feature, which is pretty straightforward and functional.go back to top

importing and syncing data from banks

Being able to sync your bank data to your accounting data is one of the promises of cloud accounting. A lot of software that's supported by the cloud has this feature.Unfortunately, though, this automatic syncing of data doesn't always work. This issue has more to do with the bank than the software. This being the case, your accounting software needs to be able to manually import data as well.Being able to import bank data is a big time saver, since it allows the software to semi-automatically enter data and match records for you (I say semi-automatically, since you always need to verify the data being entered).LessAccounting can both sync data - and manually import data - from banks.

processing data

processing data

LessAccounting accepts QIF and QFX files (which are actually Inuit file types) for the manual importing of bank statements. A lot of banks provide QIF and QFX files, but some don't. If that's the case, LessAccounting recommends converting a CSV file into a QIF by going to http://csvconverter.gginternational.net/.If you're looking to import an XLS file, check out LessAccounting's page on this https://less-accounting.tenderapp.com/kb/do-you/import-xls-files.I find the ability to manually upload bank statements to be especially crucial, since your automatic bank connection can only import data from a few weeks, to at best, a few months back. This means the majority of people will need the manual upload process to work, if only at the time they are setting up their books.go back to top

data import

Who likes manual entry? Weell... no one, really. It's the analog way to get into the digital world.More importantly, a lot of our information exists digitally, and the nice thing about digital, is that it's easy to copy and move around.The ability to import data into your accounting software is something that is not only a nice-to-have, but increasingly becoming a must have. Why spend hours re-creating and re-entering data (and introducing errors in the process) that already exists?With the exception of the bank data (as mentioned above), the only other data you can import into LessAccounting is QuickBooks data.go back to top

data export

Data export is a big thing for me (and I suspect, lots of other people too), since I want to be able to take my data with me in case something happens (like the software company merges, goes out of business, or I decide to use another service). It's also good for people who like to play around with their numbers in a spreadsheet. Lastly, sometimes you want to export certain pieces of data (like say your customers) into another software application like CRM software (Customer Relationship Management).In LessAccounting, there's a data export tool under DATA & SETTINGS > Import Data > Export Data. This gives you XML data... which most people don't know what to do with.You can also export other data as a CSV, such as reports, but not all data, such as contacts.go back to top

auto entry of data

There's a couple ways to talk about auto entry of data.I believe most people relate this to the ability to connect to your bank (or upload a bank statement) and have your online accounting software automatically enter all the transactions for you.LessAccounting can connect to your banks and import the data.Remember that it's not going to be 100% reliable, so you're going to have to verify each auto-entered transaction. You're also going to want to match your documentation (your proof) to that auto-entered data as well. Auto entry data is cool when it works.The second way you can think about auto-entered data, is how much your software remembers transactions that you manually enter, like what expense account and taxes are associated with a particular vendor.LessAccounting can remember expenses associated with a vendor, which is a helpful and time-saving feature.LessAccounting doesn't handle sales taxes well at all, so you're stuck the manual way if you need to track sales taxes on items your purchase. For US customers, no big deal. For people in the UK, Australia, Canada, and other value added tax nations, this can be a potential deal-breaker.go back to top

reporting

Reporting is the end result of bookkeeping that most people are eager to see. Once you generate reports, you can finally see how much money you made, how much people owe you, how much you owe people, etc…QuickBooks has advanced reporting functions with hundreds of stock reports, with each report having the ability to be customized, filtered, and memorized.LessAccounting has basic reports, such as:

  • Profit & Loss
  • Balance Sheet
  • Chart of Accounts (well, really chart of expense accounts)
  • Transactions (General Ledger)
  • Payroll Summary
  • Payroll
  • Payables
  • Paid Payables
  • Unpaid Payables
  • Fixed Assets
  • Mileage
  • Receivables
  • Paid Receivables
  • Unpaid Receivables
  • Deposits
  • Sales Tax (but only sales tax collected, not paid)

I do like how you can drill down into reports, by clicking on items to get more details, such as sub-reports (a particular expense category), or individual transactions within a report (an expense at a restaurant).I don't like how the reports default to the latest month, as opposed to all dates. I'd rather drill down rather than go the other way whenever I look at reports.go back to top

taxes

If you're in the United States, this section is probably not much concern to you.If you're from countries like Canada, UK, and Australia this will be of great concern to you. This is because these countries have value added taxes, such as VAT, GST, HST. Value added taxes need to be closely tracked for items sold and purchased.LessAccounting has a very limited ability to track taxes, especially taxes on items that your business has purchased.

have to split an expense to add a tax

have to split an expense to add a tax

If you want to add tax to items you've purchased, for example, you need to split an expense, create a tax expense, and then use it as your split item. This is very cumbersome and time consuming, as this process has to be done manually.Once you've done this, you'll now be faced with the new challenge of figuring out how to pay your taxes and report your profit and loss accurately, since the tax category you've created is an expense (LessAccounting currently has no ability to categorize this in any other way).This means doing some manual calculations on the bookkeeping task that people probably hate the most, which is remitting taxes. Personally, I wouldn't recommend LessAccounting to anyone who has to deal with value added taxes, as I can see this process getting messy fast.go back to top

document attachment

Are you familiar with the terms "paper trail" or "burden of proof"? Both mean the same and they refer to the fact that you need to prove every transaction in your records. This is done most of the times through digital or paper receipts documenting your financial transaction. With this in mind, it makes sense to be able to attach this proof to every transaction, right?You can of course keep a digital or paper based record system outside of your software program, but I've found it incredibly useful to have the proof attached to my bookkeeping software's record, since it now becomes very easy to double-check the document for something like a data-entry error.LessAccounting, as it turns out, has native document attachments that work... sweet! I haven't found many software programs that can do this.

native document attachment

native document attachment

Now, where are those receipts saved? Can I download them without having to go to each and every single transaction. I want to keep a organized copy on my end as well.
can't attach documents to deposits

can't attach documents to deposits

Unfortunately document attachment is only for expenses. Although better than nothing, it forces me to ask the question, why not have document attachment for other types of transactions?go back to top

multi-currency

Multi-currency is something that's becoming ever more crucial in today's business world. Many people sell to and buy from multiple countries and collect (or pay) in more than one currency.In LessAccounting, you can use whatever currency you want. That said, you can only have bank accounts in one currency. In other words, you can't have several bank accounts in various currencies. If you really need this feature, this probably isn't the software for you.go back to top

invoicing

Yep, you can invoice in LessAccounting.How good is their invoicing feature? I give it a solid "ok". One downside is that you don't have the option to choose income accounts and another is that adding more than one item to your invoice causes pop-up windows to appear.On the up-side, you have some good options for downloading and emailing invoices once you've created them.go back to top

payment processing

Payment processing is the ability to send an invoice out to a customer and have them pay via credit card, debit card, PayPal, or some type of online method.LessAccounting has a nice built-in Paypal feature that allows you to send out your invoices using a Paypal "pay now" button.To enable this, go to DATA & SETTINGS > Settings > Business Settings > Paypal.I tested it out and it works as one would normally expect. However, I was disappointed with what happened when Paypal auto-synced with LessAccounting. The first letdown was that the automatically imported PayPal receipt of payment transaction didn't automatically match to the unpaid invoice. This was disappointing to me, since one would assume that LessAccounting would track and match payments to invoices.

paypal income minus fee

paypal income minus fee

This could be due to the fact that Paypal takes their fee off the invoice total, which will result in my Paypal transaction amount not matching up with the invoice amount.
owing the paypal fee

owing the paypal fee

The second letdown was that there was no mechanism to deal with this fee from within this match payment to invoice window.go back to top

payroll

Being able to do your payroll through your accounting / bookkeeping software is nice if you have employees. Calculating payroll manually is doable, there are online calculators that can help you. However, the reason you want to use software for your bookkeeping is so that you don't have to do things manually.LessAccounting can't handle payroll, as seen in their help article https://less-accounting.tenderapp.com/kb/do-you/payroll

no payroll

no payroll

Payroll is apparently coming soon via integration with surepayroll.com. So, for the United States, you'll soon be covered. But, for all other countries, you're out of luck.go back to top

inventory

Being able to track inventory is an essential function for any business that sells products that they need to keep track of.LessAccounting has no ability to do inventory and I'd venture to say that this will not be likely to come any time soon, since you can't even set up asset accounts.go back to top

integration

The power of software is the ability to easily share and process data across various applications. You may currently be using software for CRM, payroll, invoicing, e-commerce, etc. Whether your online accounting software can import that data may be a crucial deciding factor for you.In other cases, sometimes your online accounting software won't do everything you want it to do, so the only way to get a feature is to integrate your online accounting software with software that provides what you want.I know that LessAccounting is actively trying to integrate with other SAAS (software as a service) providers out there. They do integrate with Gmail, Basecamp, Highrise, and Shopify, although to what extent, I wasn't able to test.go back to top

mobile app

It should be noted that any online accounting software can be accessed via your web browser, regardless of your device. However, when an online accounting software provider has a device specific app or a mobile version of the site, it's designed to work well for that purpose. If you're planning on accessing your books through a mobile device, check to see if what you're about to buy is specifically designed for it.LessAccounting does have a mobile iphone app, HOWEVER, it was last updated Jul 21, 2009 (that's three years ago). So, I'd say it's not really a viable option, especially considering the reviews.

ratings not so good

ratings not so good

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other features

This is a section that covers features or functionalities that didn't get their own section.

Bookkeeping help offer

The offer to "Add up to 6 hours of bookkeping help per quarter" for $70.00 a month is interesting. A quarter is 3 months, so that is 2 hours of bookkeeping help per month for $70. In other words, that's $35 an hour for bookkeeping help. I wonder how well this does and if users of this service like it. I can see how some people would like to know that there's a bookkeeper proficient in using LessAccounting software that's available to help.

up to 6 hours of bookkeeping help for $70 a month

up to 6 hours of bookkeeping help for $70 a month

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support / help documentation

Customer support is a crucial feature for some users, especially those who are not as comfortable with software as others. I tend to just look for documentation that already exists, since I don't like waiting on support to potentially help me out.LessAccounting has been active on twitter and email, replying back to me in a timely fashion, so I have no complaints so far.I'd rather see great help / documentation than great support (although I'm sure others would have their priorities reversed). Having information that is easy to access and easy to understand is something that's nice to have.At first glance, it seems nice to have all the options under support, but digging into the help files it, it confused me more than helped me.

support window

support window

I eventually found my way around, and most of the time the help documentation had the answers I needed. When I couldn't find the answers I was looking for, an email to LessAccounting resulted in a response within 24 hours.By the way LessAccounting gets points for this helpful note!
expenses you should not deduct... who knew?

expenses you should not deduct... who knew?

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improvements

The important thing to consider when evaluating accounting software is to see whether it has the features or functionalities you need, and to decided if you can live with (or work around) the missing items.

LessAccounting is really a cash based accounting system

I should have known LessAccounting was cash based when the default settings had Cash as the checked default instead of Accrual.Why does this matter?Most businesses and financial professionals use accrual-based accounting. In fact, if your business becomes large enough, you'll be required to do accrual accounting. You can Google the difference between cash-based and accrual-based accounting plus the benefits and drawbacks of each if you want to learn more about each.Because accrual accounting is more commonly used, this presents many challenges to anyone currently doing cash accounting in their business. As LessAccounting is designed as a cash accounting system, this software won't be able to help you as your business grows, as you may eventually want to switch to accrual accounting.

Partially Paying an Expense (bill)

If you're are partially paying an expense (bill) or receiving a partial payment for an invoice, LessAccounting doesn't have a particularly effective way of dealing with this.The only solution I could find was to enter two separate expenses.

Speed

One of the things that held me back from using web apps in general is speed. A split second in difference is enough to frustrate me.

processing data

processing data

Desktop apps don't usually have delays like that. For the most part, LessAccounting is fairly responsive so I didn't find myself too restricted. But there are times where I encountered "Processing Data" pop-ups or experienced a lag between typing or clicking something and something actually happening.If you think a second here or there is not a big deal, then consider why Google is so obsessed with speed. For them, the difference between 100 milliseconds to 400 milliseconds is a big difference. So a difference from between 1 to 4 seconds is massive when you're considering the speed of your web app.go back to top

country it's made in

In some ways, the country where the software is made shouldn't matter. However, I think for accounting software, it matters more than with other types of applications. This is because the people in their own country should (and emphasis on "should") naturally design the software to fit the needs of their local tax and accounting requirements better than software made in another country. I've noticed this especially when it comes to taxes and payroll.LessAccounting is made in Jacksonville, Florida in the United States.Since bookkeeping is fairly standard around the world, I think US developers should seriously look at the requirements of international users (such as tax reporting for sales taxes and payroll). These two elements seem to be lacking not only with LessAccounting, but also with the majority of US-based software I have looked at.go back to top

price

Pricing is pretty straightforward with LessAccounting, which costs $30 a month.Unlike other online accounting software, there is no trial version or 30 day free version.However, there is a demo version at https://demo.lessaccounting.com/dashboard.go back to top

recommendation

Do I recommend LessAccounting? I'm going to have to say no.My biggest reasons are twofold: (1) no way to do general journal entries and (2) no way to create and edit a proper chart of accounts with assets, liabilities, equity, income, and expense accounts.If you're a bookkeeper or accountant, you'll know exactly what I'm talking about and why this matters so much. If you're a small business person thinking, "so what", I'll tell you why it's important.Journal entries are the basis of bookkeeping. Credits and debits. Money goes out of one account and goes into another account. The point of software, is to do that in the background so that users hopefully never have to learn about that stuff. That's a great goal, but it doesn't work 100% of the time. There are always exceptions where the software can't handle a certain transaction and a manual journal entry is needed. If your accounting software doesn't have this capability, you're screwed.It's kind of like backing up your data on your computer. Even if your hard drive works 99% of the time, you need to be prepared for emergencies such as fires, theft, accidents (e.g. you drop your laptop), etc. You need to have your data backed up or face the consequences. It's the same with accounting software- you better have a way to do a manual journal entry. That's your backup.For the chart of accounts, this is also an accounting must. You need to be able to setup and control assets, liabilities, equity, income and expense accounts. Without this ability, your software will be limited to only handle a small set of business situations, and prevents it from evolving with your business.I'm all for finding easier ways of doing things. But if you remove core functionality in the name of ease, the simplest of things become incredibly hard or impossible.

Is there anyone who I would recommend LessAccounting to?

If you run a cash accounting business with no assets or liabilities (like a loan), you are setting up your books from scratch, and you live in the United States, I would say maybe.However, if LessAccounting were to add the two core bookkeeping functions of chart of accounts and journal entries, I would change my recommendation.

Is there anything that I did like?

I liked the fact that when you're first getting into LessAccounting, they have helpful tips built right into the interface. Once you start entering data, these largely go away, but there are still places that have these little question marks you can click on to get more information about a specific topic. I think this is probably the most intuitive and "the info is in the right place at the right time" way of providing help to users that I've seen out of any accounting software that exists.The ease of categorization upon a bank import, and the fact that the software can remember this, are also two nice features that are done well. This saves time and I find it smart.The fact that LessAccounting has the ability to accept payments through PayPal integrated into its invoicing is also a great feature. I tried it and so far, it worked flawlessly.The fact that LessAccounting doesn't differentiate between contacts (i.e. it just lumps vendors and customers together), is an interesting concept. It seems simpler than dividing people into those two categories. I don't know how this would work out in the long run and would only know if I used the software more extensively, but it seems like it could be a good idea.Lastly, the tasks feature that show the number of things you need to take care of is also an interesting concept. Wouldn't it be great if your software was so smart as to let you know what you need to do next? I don't think the tasks function cover everything that needs to be done, but if it's able to act as your bookkeeping checklist, then it would be a very useful feature. I currently have a checklist on a spreadsheet that I use to make sure I don't forget to do any task.

Other accounting software

If you're wondering about alternatives, I'm currently doing an online accounting software review and comparison. Currently I've done reviews of the following accounting software:

  1. Kashoo review
  2. Wave Accounting review
  3. LessAccounting review
  4. Quickbooks Online review
  5. Xero review
  6. FreshBooks review
  7. FreeAgent Review

Note: For an up-to-date review and comparison of online accounting software, please check out my ebook.

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setup and walk through notes

Date Setup

I like how you can choose a date format. It's a small thing, but I personally find this to be an important component when I enter data.The option is under Data & Settings > Business Settings > Time, Date, Currency

option to choose date format

option to choose date format

Sales Tax

It seems easy enough to setup sales tax, and multiple values. I'm going to throw the "Sales Tax" fields on by default.

setup your sales tax

setup your sales tax

Cash and Accrual Settings

You can use both cash or accrual accounting for your business. The LessAccounting software is set to cash by default. I'd personally choose accrual over cash accounting , which is why I don't necessarily like their suggestion to go with cash. However, I do like how they have the little question mark you can click on to get more info as I've had people ask if software can do cash accounting. So for LessAccounting the answer is yes!

cash or accrual accounting

cash or accrual accounting

Member Permissions aka Multiple User Restrictions

It is handy - especially for larger businesses - to be able to allow different people different types of access to information. LessAccounting has two levels, trusted and untrusted, which you can see in the screen shot below.

member permissions

member permissions

Setting up Expense Categories

Under DATA & SETTINGS > Settings > Expense Categories you can setup your expense categories. This is easy enough to do. I'm used to doing this through a general accounts page (chart of accounts) in other software, so I wonder where in LessAccounting I'll find the ability to setup and modify other types of accounts.

easy to add and modify expense categories

easy to add and modify expense categories

Based on this "Expense Categories" page, there seem to be no options to give more details to your expenses, such as a description or tax code to associate with it.

Setting up Bank Accounts

To set up your bank account go to GENERAL > Bank Accounts. You can do this manually or automatically - your choice.I'm going manual this time around as I've had mixed results going automatic with other software. I want to try to see if I can set up my bank accounts manually without any problems before doing this automatically. One of the reasons for this is that if you're working with data that's between 1-3 months old (or more), a lot of existing software can't import the data automatically. This is actually a limitation that banks impose and not a software glitch.

Setting up Credit Cards

This is very similar to setting up a bank account. Go to GENERAL > Bank Accounts.When you set up your credit card manually, make sure to choose "This is a credit account" under Account Details. If you are carrying a balance, you will need to enter the number as a negative. For example, I had a balance of $4,643.85, so I put my starting balance at -4,643.85.

setting up a credit card

setting up a credit card

This means that when you go to reconcile, you'll need to put any balance you have on the credit card in negative numbers. I was scratching my head trying to figure out why things wouldn't reconcile for a few minutes until I figured this one out.

Vendors or Customers? Nope, just Contacts!

LessAccounting doesn't allow you to categorize contacts into customers and vendors. Rather, they use a catch-all system that lumps them all together. I don't know how I feel about this yet. On one hand it simplifies things… on the other hand, it might introduce potential issues. The jury's definitely still out on this one.Contacts are found under GENERAL > Contacts.

Auto syncing of data

When I went into LessAccounting, the first thing it asked for is if I wanted to sync with my bank. So I went ahead and said "yes" but didn't have much luck with it so that was a big letdown.LessAccounting is stuck "processing" for a while before finally generating an error message. And then it tells you that it will try again in a few hours. So much for a good first impression.

matching imported account to bank account

matching imported account to bank account

I've later gone on to discover that this issue has more to do with my bank than with LessAccounting. The syncing feature works fine with some of my other accounts, so, it does actually work.That's the thing about these automated bank imports feature. It's great when it works but it doesn't always function properly for a variety of reasons, no matter the software. The best way around this is to manually upload an electronic bank statement to your software that you've obtained from your bank.

Manually importing data

To manually import data, you go to GENERAL > Bank Accounts, choose your bank, and look for the "Choose File" button under Manual Data Upload.Once you've done that, you're then taken to an import transactions screen, where you can categorize all the data.

manually importing data from a bank

manually importing data from a bank

Although this seems like a nice feature, I'm wondering how to add sales tax, split expenses and mark an item as a transfer instead of an expense, such as a payment to my credit card account (which was setup at the time of import).
no option to mark my credit card payment as a transfer

no option to mark my credit card payment as a transfer

Another problem I've run into is figuring out what to do with my financing payment for my vehicle. Part of the transaction is payment of a loan, the other part payment of interest. I don't know how to set up a loan in LessAccounting and even if I did, it doesn't tell me how to split this payment into two different accounts?
no loan accounts

no loan accounts

I read up on loan accounts at https://less-accounting.tenderapp.com/kb/do-you/loan-account-equity-accounts-or-stocks. This answers my question, no loan accounts....Any money that is received is categorized as a deposit. There is currently no other way around this, so I'm assuming you'll be able to assign the deposit to an invoice at a later time.I left a whole bunch of transactions uncategorized. This is what occurred as a result:

  1. transfers to bank accounts or credit cards
  2. deposits
  3. split transactions
  4. bill payments

The non-deposits show up as "Uncategorized Expenses".

uncategorized expenses

uncategorized expenses

Importing Data

LessAccounting can manually import data by using a QFX or QIF file.

can manually import bank data

can manually import bank data

https://less-accounting.tenderapp.com/kb/how-do-i/how-far-back-can-you-import-dataYou have the option of importing data through DATA & SETTINGS > Import Data.One thing I liked about other comparable software was the ability to import CSV or XLS data files. Most of the data that you can import will typically come from other software services. This is great if you are a user of those services and not so great if you're not (which is probably the case with the majority of users out there).Something that interests me is the ability to import data from shopify shopify.com, since I think there's a huge need to flawlessly integrate accounting software with e-commerce software. Manually entering data from your e-commerce solution into your books is so unecessary in this day and age.If anyone has tested to see how shopify works with LessAccounting, I'd love to hear about it.

Dealing with unpaid invoices

There's currently no way to do manual entries (journal entries) in LessAccounting. This presents a bit of an issue, especially when trying to transfer accounting data from another system. So, you'll have to manually re-enter all your unpaid invoices.

Dealing with unpaid bills

It's the same story as unpaid invoices, in that you have to manually add all your unpaid bills into LessAccounting.

Dealling with uncleared checks

If you still use checks (like most people, including me), you may have some uncleared checks at the time you switch over to your new accounting software.Uncleared checks present a tricky situation, since the bank balance that you see in your software won't actually reflect what's actually happening in the real world (i.e. your software will show your bank balance minus the uncleared checks).To deal with this, you'll have to enter your actual bank account balance when you create a bank account in LessAccounting. This is easy to do and can be done through GENERAL > Bank Accounts.

creating a starting balance

creating a starting balance

This is a tricky as you can't create an expense at the time the check clears, since this will create an expense in your books that was already accounted for in your other set of books. In other words, you'll be double-counting expenses.The right approach would be to create an unpaid expense (bill) before the start date of your new set of books in LessAccounting, so that the expense gets recorded in the right time frame.You can do this if you practice accrual accounting. If you know you do cash accounting, just ignore everything I've said :)

Creating a new expense

To create a new expense category, go to expense > add new expense

adding a new expense

adding a new expense

You'll see a pop-up window where you can enter your expenses.
expense pop-up window

expense pop-up window

At first, I couldn't figure out how to create a unpaid bill instead of an expense. The answer ended up being quite simple and was actually starting at me in the face: simply untick the "Paid?" button. I think this is a smart way to enter bills and expenses, since it uses the same window. And to switch from expense to bill, all you do is untick a box.
switching from expense to bill

switching from expense to bill

I'm going to assume the "Assign a Client" drop-down box means that you can assign an expense to a client.
assign a client

assign a client

I was a little confused about "Assign a Client", since I thought it was choosing a vendor, which I believe can be found in the drop-down box named "Payee".
payee

payee

To split expenses you simply click on the "split expense" button.
splitting expenses

splitting expenses

Creating an invoice

To create an invoice, go to MONEY IN > Invoices

creating an invoice

creating an invoice

In order to add items to charge a customer for, you need to click on "Add Line Item"
adding a line item to an invoice

adding a line item to an invoice

Everytime you add a new line, you get redirected to a new window. It seems like an extra step to the process that's not really necessary. I also don't know why I have both the option (which is ticked by default) to "Apply Sales Tax to this line item" and "Apply HST to this line item" when "HST" is also how my local sales tax is called.Once you've done your invoice, you can email it, print a copy, or download a PDF.
options for sending an invoice

options for sending an invoice

I like how sending the invoice as an email is a built-in process (although, I still prefer downloading a PDF and sending it from my email program).There's only one income account, so if you want to categorize your income you have to use tags.
use tags to categorize income

use tags to categorize income

Customizing Invoices

I like how you can customize the invoices with your own words. To do this, you have to go to DATA & SETTINGS > Business Settings > Invoice & Proposal

customize wording on your invoices

customize wording on your invoices

For the look of your invoices, you have bit of customization available, but it's really nothing to write home about. You can pick some colors and choose between two templates but that's about it.Select templates through DATA & SETTINGS > Settings > Templates
custom invoice template 1

custom invoice template 1

Reconciliation

To do a reconciliation, you go to MONEY OUT > Bank Reconciliation.When you go to add a reconciliation, you need to enter a start date, end date, beginning balance, and ending balance.

info needed for a bank reconciliation

info needed for a bank reconciliation

Once you enter that information, you can now reconcile. You are then immediately taken to a new window in your web browser. Assuming that you are importing your bank statement data, reconciliation should be easy. This is because reconciliation is the process of matching your bank statement to your accounting records. Since you imported your bank statement into LessAccounting, your accounting records in LessAccounting should theoretically match your bank statement data, thus hopefully making it a quick double-check.
reconciliation detail

reconciliation detail

Amounts are in red for all uncategorized items, such as my transfers between accounts. I honestly still don't know how to deal with these.I've now spent about 30 minutes trying to figure this out on my own with no luck. One help document I looked at was this Youtube video, which really didn't help me at all.I also tried their written instructions (found below) which also didn't help.

If both bank accounts are setup in LessAccounting then this is a transfer of funds. So create a transfer of funds you'll simple navigate to "funds transfer". If you've imported these transactions and need to change them from "expenses" and "income" to a "funds transfer" navigate to that page and click "add" the app will highlight possible funds transfer.

Ok, I thought I had this figured out. I thought if I imported the other side of the funds transfer transaction (my credit card statement) LessAccounting would work its matching magic. Alas, no luck.

it works

it works

In the end, importing my credit card transactions eventually worked. I totally missed the "Possible Transfers" button, which magically appeared in my nav bar.This makes me want to get into my rant about changing navigation bars, which really upsets me, since navigation items appear and disappear. Wouldn't it be much simpler to leave the items under "tasks" always there?In any case, I don't see why you can't categorize a transfer as a transfer right from the import. That would have saved much headache and made a lot more sense.

Data export

In LessAccounting, there's a data export tool under DATA & SETTINGS > Import Data > Export DataWow, an XML dump! I don't think average users will know what to make of this... I don't even know if other software can import XML without converting the format. Is it that hard to do a standard .CSV or have multiple export file type options?

xml dump... hard core!

xml dump... hard core!

Guess I spoke too soon. Looks like you can export the General Ledger as CSV if you go to General Ledger.
export data as a csv

export data as a csv

You can also export other data as a CSV, such as reports, but not all data, such as contacts.

Support

There are seven different help options: Read Common Questions, Read Problems, Read Suggestions, Submit Complaints and Questions, Chat With Us, Call Us, and Quick Help Videos. I don't mind having these options, but which one would you choose when trying to quickly and easily find an answer?One part of the help which I don't find very useful is the "Quick Help Videos"Each video is 30 seconds and seems more like a sales videos than a help video.Another thing I disliked about the help is that it's difficult to figure out the difference between "Read Common Questions", "Read Problems" and "Read Suggestions"."Read Common Questions" seems to be for documents written by LessAccounting to answer frequently asked questions."Read Problems" seems to be a place where users can post their problems and get answers. I find this pretty similar to "Read Common Questions"."Read Suggestions" seems to be similar to "Read Problems", where users can post suggestions and get answers.The help is divided into discussions and articles, which is also labeled as "Knowledge Base".Articles are static pages, authored by LessAccounting. No back and forth on discussion pages, only info. This is where "Read Common Questions" takes you.Discussions are dynamic pages that users start. In other words, a user asks a question that can be answered by another user or by LessAccounting. This is where "Read Problems" and "Read Suggestions" takes you.If you use the search bar, it can only search one part of the site, either the Discussions side or the Knowledge base side. You can easily click the tab to switch your search to the other side, but I wonder why that is. Wouldn't it be eaiser to search both sections at the same time?To be fair to LessAccounting, this peculiarity is not due to their help system itself, but the result of the actual help system software they are using by Tender Support. However, a user probably won't realize or care for that matter. I personally find it confusing that the "knowledge base" would be labeled "Read Common Questions" and "Articles" at the same time.

articles vs discussions

articles vs discussions

Some questions I sent out to LessAccounting and some answers

  • Q: Is there any way to do a journal entry? From all my searching in your app and on your help documentation, I don't think this is possible.A: There's no way to do journal entries in Less at the moment. If you let me know what you're trying to adjust, I might be able to come up with a good solution for you.
  • Q: Is there any way to handle loan payments? Ex: I have a car I'm financing and am paying down a loan (liability) plus paying interest (expense). I don't see any way to do this.A: The way I would suggest handling a loan is to set it up as a "bank account". Enter the starting balance of the "bank account" as a negative balance (the balance of the loan). When you make payments, you would transfer the money between the two accounts and enter the interest expense.
  • Q: Is there any way to add liabilities and assets (since I'm transferring over existing data, I have lots of assets and liabilities like A/R, A/P, Loans, and such). I know how to add my bank and credit card starting balances, but can't figure out how to do the rest.A: For A/R, I would suggest that you recreate those invoices in Less. For A/P, I would suggest that you recreate those bills. Loans would be treated as I mentioned above. Assets: we have automatic depreciation if this option is selected. You could enter the purchase date and amount of each asset and then select the depreciation timeline.
  • Q: Is there any way to pay a bill over a couple payments? Can't see how to do this.A: We currently don't have a great way to do this. In order to get this done, you would have to edit the unpaid expense to the amount that you've paid and then recreate an unpaid expense in the amount that's left over. I know we have to sort that out!

QuickBooks Import

One of the things that differentiates LessAccounting from other software not named QuickBooks Online US is that you can import your data from QuickBooks.I've decided to try the QuickBooks import function. If it works, it can be a key selling point for existing QuickBooks users (the screen is refreshing every few seconds, which is making me a bit nauseous... but if it works... it's worth the temporary white flashes in my eyes).

trying to import a QuickBooks file

trying to import a QuickBooks file

You download a piece of software from QuickBooks
QuickBooks web connector

QuickBooks web connector

The QuickBooks Web Connect software is doing its thing... It quickly goes to 30% but now it's been 5 minutes and the total progress is 0%.
paused

paused

Uh oh… after an hour, my webpage is no longer available. I go to lessaccounting.com and the website is still up. I login and I'm told "This webpage is not available". I decide to wait another hour and see what happens. Actually, I was too impatient to wait, so I tried another browser, Firefox. It's doesn't work there either… but, oddly enough I get an email saying my password was reset. I use the reset password and it works, so I manage to get in even though I never ask for it to be reset (although I could have somehow hit the password reset button by accident).
and we're out

and we're out

The LessAccounting server goes down while testing so I've decided to give it an hour or two… (it's one of the disadvantages of having your data online so this does tend to happen every now and then)… After an hour I see the server back up again.I decide to reset everything and start from scratch. This time I'm successful.
success!

success!

So things look like they imported roughly ok. One thing that didn't work was the import of two of my credit cards, which resulted in 191 uncategorized expenses.
that's a lot of uncategorized expenses

that's a lot of uncategorized expenses

My experience was a little rough. Was it worth it? I'm still on the fence with this one. I think that if you want to have a go at it, it can't hurt. But don't expect perfection. If the imported data doesn't work well, go from scratch as your data will be cleaner that way (clean data means error free, accurate data). You also have to remember, you'll still have your QuickBooks data available, so you're not really losing anything.Here's a response from tech support at LessAccounting after I encountered my first set of import issues.

Hi Greg,Thanks for trying to import by yourself. You're so brave!What you did does happen at times. For some strange reason the QB Web Connector errors out due to connection problems with the LessAccounting server. However, it should allow you to continue where you left off. If in case you did have data imported but want to start over, like you did, you can request to clear your data.After an import you also have an option to do an import again. A link will appear to allow you to do just that.Another important thing to remember is that LessAccounting has a simpler and more elegant way of representing your financial data than what QB does. The QB importer is a more or less generic way of bringing QB data into LessAccounting so it isn't perfect. Since, each QB installation is unique, we cannot guarantee that all your data is imported as LessAccounting does not support every feature in QB.When Invoices are imported they are usually renumbered based on LessAccounting automatic numbering. They are also marked as Draft so you can review and correct them. After every import, it's always best to do reconciliation on the bank accounts to ensure that they are complete. Does this make sense?

Their support was quite responsive, so I have to give them props for this.