[Leaplist] Accouting software -- 6 things to know about Linux (and why to consider Apple)

[Fred Moore]

On Thursday 16 November 2006 12:18 am, William Warren wrote:
> any suggestions for accounting software?  This is for a one person LLC.

I think only you can answer what specific package does what you want.  But let 
me explain my reasoning.  As a previous owner of a couple of corps and now 
a "one person LLC" just as you lets looks at this from a different 
perspective.

When we talk about GAAP accountants tend to put things in that bucket that are 
the opposite of what you and I are most likely to need the accounting 
software for.  We want it to be a tool.  They want it to be a tracking 
mechanism to make their life easy. 

I think of accounting as a tool to be used by me to gage the health of my 
company.  I expect this to gage the health correctly at any specific time.  I 
also expect any errors to be corrected instantly.   Let me give you an 
example.  lets say that erroneously you accidentally enter 10k of income as 
an expense.  Under GAAP you are not allowed to correct this transaction.  You 
MUST enter another transaction to reverse the transaction in error.   Under 
GAAP you must never correct only do additional work to resolve simple 
mistakes.  (sorry but I will not hire an account to do the additional work, 
and my time needs to be spent building my company not keeping an accounting 
system operating).  Also under GAAP you must effectively "close the books" at 
the end of each period (more work).  Which in most cases is the end of each 
month.  Under GAAP you can not make a correction in the period the mistake 
was made once a period is closed.  your month could suck big time on paper 
but be really good in reality. 

Most likely you just like I look at things that effect your bottom line daily.  
Or you need information in case you are ever audited. 

So as a small example.. on June 29th you make a huge mistake putting 10k in 
assets when it was in fact debt.  The books get closed on June 30th.  You 
look at the report on July 1st and immediately notice that assets are 
incorrect.  Under GAAP you can enter a transaction to reverse it in July but 
you can never correct the June report.  

To me it was more important to be accurate at all times then to comply with 
GAAP.   GAAP does not accept that recording a change to a transaction is the 
same as recording another transaction (dumb, dumb, dumb)  Almost all 
accounting package record each and every change as well as new transactions.  

Anyway enough about GAAP.  I contend unless like you Bryan said you do a lot 
of government contracts.  Then it may be a requirement, but most likely only 
on government contracts that are cost plus.  Which I just won't do.  check 
out some of the links from. 

http://specialreports.linux.com/

if you follow the links there is a lot of information. 

I mistakenly made a Quickbooks decision years ago.  The decision was mostly 
based on which packages incorporated "Payroll"  I found that with a spread 
sheet calculate payroll in the same amount of time it took me to enter the 
information into the accounting system.   So I would suggest you eliminate 
this from your search.

Decide what you want for an interface, web, GUI, db based,  etc.. this will 
help you.  Bottom line most accounting packages will run a small company.  
Most accountants will tell  you "you need a GAAP" type of software.  But 
think about it.  This keeps their problems in small packages (month, month, 
month, year) perspective.  Your requirements are to have sufficient detail to 
1) file your taxes, and 2) defend yourself in case of an audit.  

In reality a "one person LLC" could be run from a ledger sheet almost a 
quickly as using an account package.   Yea you don't get the pretty balance 
sheet reports but quite frankly I don't care I can read and understand.  I 
don't need to be able to generate reports that other people can understand. 

While I know this is not so much linux related.. many of us make our living on 
linux and we need to track profit and loss.. 

as another hint and I have been there..  make a change in accounting systems 
at the 1st of a month.  BTW the IRS does not require you to use any 
accounting package.  They only require you to be able to show what you did 
when and if they ever audit you. 
hope this helps... Fred