Free accounting software or scam?
Written by Rita Krekovska ACMA, CGMA
| Published on January 8, 2023
- Fact Checked by Janis Krekovskis
- Updated in last 6 months
There are multiple free cloud-based accounting softwares, however which one to choose? Will it be a good free accounting software and will it do the job.. or is it a scam?
In this digitally developed era we are presented with an immense amount of softwares and applications to use to enhance and drive efficiencies in our business day-to-day operations. But while this sounds good, there is a risk that without realising it we can step into a trap of sharing sensitive information about ourselves and our businesses to fraudsters.
So, how can you tell the difference between good ‘free accounting software’ and ‘scams’?
Six step check-list
I have enlisted six steps or points to consider when you do your research to choose a really good free accounting software for your small business.
1.
Users and reviews
First step is to check how many users or reviews does this accounting software have. Use global review sites like Trustpilot or any other review sites specific to your country or region.
2.
Software security and policies
Always check information if the software company offers robust security features, such as firewalls and data encryption and if the company is transparent about its security policies.
3.
Record of data breach
This may be not an easy step to perform due to the amount of information available online but look up if there is a history of data breaches or fraud. Google Search may help you to find any additional information if the company behind software had been investigated for any data breaches.
4.
User Interface - what does the software look like?
Check what does the User Interface look like – does it have a professional, modern appearance or it has distorted tables, templates and reports?
Create a demo account and check if you can create reports and enter data. The Q&A or Frequently Asked Questions section will give insight into any frequently asked questions about services, customer support, hidden fees, functionality. Also blog posts or new releases will help you to understand how often communication has been released publicly.
5.
Owner of the platform
Please do not skip this step – check details of the owner of the software.
You can search details about the company on the Companies House. Don’t overlook important sections, like the nature of the business and if the company has been trading previously under any other company names.
This will help you to have an insight if it is a newly created company or it has shifted their business type by renaming it and starting a new business venture.
6.
Software updates
Every developed software will have updates and releases and these would be communicated through software’s blog posts or communication sections. Check if the software is updated regularly and when it was the last update.
Shared insight in any future plans and project timeline would provide confidence that the accounting software company is legit.
These are important to you to know as you do not want to set up your business operations twice or even more times if software becomes obsolete.
Conclusion
If the software that you are researching has passed all the six points then most likely the software is not a scam.
However, if you are not sure if the free accounting software would be serving its purpose for your business operations, then you should reach out to an accountant and ask his or her advice.
I hope that this article has helped you to have a better clarity of what you need to look at if you choose to use a free accounting software and not to fall in a ‘scam trap’.
By Rita Krekovska ACMA, CGMA
Rita is Chartered Management Accountant and online influencer known as Digital Accountant.