Software Second Look: Zoho Books (Part 2)

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Last week I started my 'Software Second Look' of Zoho Books, a cloud-based software I used a few years back for ‘Accounting Tips Tuesday’ when I wrote the ‘basic accounting’ series called ‘Accounting 101’. Zoho Books had a fairly large following outside the United States, but not a lot of subscribers within the US. Since then they have been recognized by several independent reviewers as one of the best ‘small business accounting software’ offerings and I can understand why. Zoho Books is simple-to-use, highly-functional online accounting software offering a big feature set for a relatively low subscription price. 

Last week, in Part 1 we looked a 'Money-in', today we turn our attentions to Money-out, and the remaining functionalities of Zoho Books.

Money-Out

The time comes when you have to spend some of that revenue you have been generating, so let’s look at the ways Zoho Books has you covered when it comes to money-out.

Vendors/Suppliers

Maintaining a proper relationship with your vendors/suppliers enables you to get the best terms, delivery schedules, and prices. Your vendors/suppliers will appreciate the fact that with Zoho Books you can give them direct access via a ‘Vendor Portal’ so they can stay up-to-date with Purchase Orders, their Bills, and most importantly the payments they are due.  Both you and your vendors will appreciate the historical view the portal affords of the long-standing volume of work that you have done together, serving as a prime negotiating point for better terms in the future.

Purchase Orders – the PO feature gives you the ability to track every purchase from the moment an expenditure is planned to the time it is committed, as well as when the related products or services are received. It’s easy to associate customers or projects with purchases so that what you buy can be tracked to how it will be used. Easily convert any Purchase Order into a vendor Bill when you receive the supplier’s invoice.

Inventory - enabling inventory tracking helps you keep tabs on your stock levels at all times, you will be able to track your items from the moment you create them. Zoho accounting software values your inventory using FIFO methodology. Their Cost-lot tracking makes it possible to see your stock on hand and its current valuation at any time.

Easily create a customized price list with markups or markdowns and offer it to your preferred vendors and customers. You can organize your inventory with vital information like SKU, product image, vendor details, cost, and stock on hand and set reorder levels so that you get alerts before the stock level drops below your minimum, then if you have selected preferred vendors for those items, you can send purchase orders instantly.

Landed Costs – like a very sophisticated ERP system, Zoho offers you the ability to add landed costs so you can calculate the full cost of your items and determine the correct selling price based on all the factors associated with products, not just purchase price.

Returns – not a problem with Zoho, you can instantly track returns of items to your vendors for use against the corresponding bill, as a credit to be used against a future purchase or awaiting a full refund via any payment method your supplier provides.

 Expenses – Zoho tracks your day-to-day expenses with ease as well, whether you are making a one-time purchase, or reimbursing an employee for out-of-pocket costs, you will have all the details and flexibility you need for cost categorization, as well as customer and project accounting.  There is no need to add-on a 3rd-party App to scan expenses, with Zoho it’s part of the package, just scan the document and all the important information will be incorporated into the expense along with a copy of the document eliminating the need for manual entry.  You can easily set-up your regular expenses for payment and put them on ‘auto-pilot’ so that you never miss a recurring expense.

Bill Payments – may need approval (or several) in your organization but with many small cloud systems that are a problem, they simply don’t offer workflows. It’s not a problem with Zoho Books, you can build ‘payments’ approval into the workflow of your accounts payable so that bills are reviewed and approved by the persons needing to control the flow of funds before payment, not after payments are made.

General Accounting & Administrative

There are a lot of general accounting and administrative tasks that must be performed, and most accountants and bookkeepers want to know how any accounting software accomplishes those things as well. So let's look at those areas.

Administrative Control

While you might start out as a small business with only a single user of Zoho Books, chances are you are going to be a multi-user of Zoho before long. This means that you need to be able to control who has access to what portions of your business accounting data.  Zoho lets you set-up User Roles for each individual and give them permissions right down to which data they can access.

Banking

As I mentioned back in discussing customer payments, when you get paid on-line your payments not only post to your financial accounts, but they also post against the related invoices. This means when you connect your bank accounts with Zoho you will not only fetch transactions from your on-line sources and banks for easy reconciliation.

Transaction matching will be automated with configurable bank rules that make certain things post ‘just as they should.’ Zoho will identify the best matches for all your transactions making reconciliation as simple as it can be.

Documentation

Easily increase safeguard your records, insure compliance, and enhance collaboration with your accountant using the built-in document features within Zoho Books by attaching copies of receipts or bills to the transactions themselves . It's simple to match time to to transactions in your bank feeds. The Auto-scan option in Zoho Books will capture your document details and convert them into an invoice, expense, bill, sales order or purchase order and retain the original document as the related source.

By matching them during the bank feeds-matching-reconciliation process  you have proof of your transactions for your records for accounting and legal purposes, your records are safe in the cloud, and you can organize them as you wish for easy retrieval.

Reporting

There is probably nothing more important than the ability to convert your accounting data into meaningful financial reports and to do so with ease. That's why Zoho Books contains a simple to use reporting engine that let's you generate financial statements any time you want them. You will easily generate reports with the data you need in the format you want, and associate 'tags' to help you filter your data to get the specific information for the report you are looking for.

You can even access a variety of reports and other information if you have the necessary permissions using the Zoho Books mobile App.

More for the Money

You know me, I don't really ever talk 'price' when I review an App or software if I can stay away from it. There are a couple or reasons. First, as soon as I quote a price, it will change for one reason or another, it goes up, or there is a discount or sale, and then what's in the article is wrong. Second, over the long haul with people who may read what I have written ten years from now the price will undoubtedly be wrong.  So, I just try to stay away from actual $-amounts. 

What I can say is that Zoho Books is very, very economical whether you are on their minimal 'Basic' plan or their high-end 'Professional' plan, or the one right in the middle. If you choose to pay yearly, it's even cheaper than if you pay month-to-month. But do realize that the quoted prices on the website are not inclusive of any taxes that might be due relative to your jurisdiction(s) that may or may not charge taxes on such SAAS services. 

There are a variety of add-on services that may also apply depending on your own unique situation or desired product configuration, so you may want to consult with a Zoho Associate or a Zoho Partner Program member prior to making any commitment(s).

Over the last two weeks, in Parts 1 and 2 of this mini-series, I've spent a lot of time (and words) telling you that Zoho Books is a comprehensive cloud-based accounting system with a lot of included features that you would otherwise be required to 'App in' (add-on) by subscribing-to from a 3rd-party vendor if you were using almost any other accounting software at this product or price level. So, if your interest has grown, head over to the Zoho Books website for more details and consider scheduling a 'free demo' while you are there, or maybe 'sign-up for a 14-day free trial', because who better to test it out with a copy of your own data then you.

Zoho is a proud sponsor of Insightful Accountant's 2021 ProAdvisor of the Year and Top 100 ProAdvisor Awards Program.

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