The short version
Key takeaways
- Start with the entity, accounting method, reporting obligations, and transaction workflows.
- Controls, reconciliation, records, access, and accountant review matter as much as invoicing features.
- Test migration, exports, backups, and period close before committing to the system.
Define the accounting and business requirements
Document legal entities, locations, currencies, accounting method, fiscal year, tax registrations, payroll boundary, inventory, projects, fixed assets, grants, and required financial reports. Involve the bookkeeper, accountant, tax professional, and operational users who create transactions. This guide is a software framework, not accounting or tax advice.
List transaction volumes and workflows for estimates, invoices, payments, bills, expenses, bank feeds, deposits, refunds, credits, payroll entries, and month-end close. Link the decision to the cash-flow forecast the business needs to operate, not just the reports shown in a demo.
Evaluate controls and record quality
Check role-based access, approval limits, separation of duties, locked periods, change history, attachments, reconciliation, duplicate detection, and exception reports. Determine how corrections are documented and whether an administrator can alter important records without visible history.
The IRS says records must support the entries on a return and that computerized records need enough detail to identify underlying source documents. Confirm requirements with a qualified professional, then test whether invoices, receipts, journal history, payroll records, and reports can be produced in a usable form.
Test complete transaction cycles
| Cycle | Test | Evidence |
|---|---|---|
| Sale to cash | Invoice, partial payment, fee, refund, reconciliation | Customer balance and bank match |
| Purchase to payment | Bill, approval, payment, credit | Vendor balance and audit history |
| Period close | Reconcile, adjust, lock, report | Repeatable close checklist |
| Record request | Export source and summary records | Legible, complete package |
Apply the broader software selection scorecard to security, usability, implementation, support, commercial terms, and exit readiness.
Inspect integrations, reporting, and resilience
Map bank connections, payment processing, ecommerce, expense tools, payroll, time tracking, inventory, CRM, and tax workflows. Identify the source of truth, synchronization timing, fees, failure alerts, and reconciliation method. Avoid an integration that silently creates incomplete or duplicate transactions.
Build a report pack for management and professional review: profit and loss, balance sheet, cash flow, receivables, payables, and relevant project or class views. Determine what the vendor backs up, what you can export, and how your own business data backup strategy covers accounting records and attachments.
Plan migration, close, and exit before signing
Decide what history to migrate, how opening balances will be verified, how open invoices and bills transfer, and when the old system becomes read-only. Reconcile a trial balance and key subsidiary records with professional review. Run parallel checks across a close period when the risk justifies it.
Calculate subscription tiers, users, payroll, payments, integrations, support, implementation, and expected growth. Confirm cancellation, data access, exports, retention, and support after termination. Choose only after users complete representative cycles and the accountant confirms that the records and reports support the business's needs.
Common questions
Frequently asked questions
Should a small business choose accounting software without an accountant?
The owner can lead the business decision, but professional input is valuable for entity, tax, payroll, reporting, migration, controls, and record-retention requirements.
How much history should be migrated?
It depends on reporting, comparison, audit, tax, customer, vendor, and operating needs. Many businesses migrate open items and verified balances while retaining accessible historical records.
References and examples
Primary sources and product examples used to ground this guide. Product links are editorial references, not endorsements.