FreeAgent Review 2018
A no-fuss bookkeeping program for small business that combines depth with ease of use; it mostly succeeds, though some functions are only available in the UK.
By Ben Schmitt – Last Updated: 19 Jun'17
Here at Cloudwards we’re all about making people’s lives easier through cloud-based computing.
Since small businesses are people, too, we’re doing a series on browser-based accounting apps that will allow you all the benefits of being able to work from anywhere yet still have all the power traditional accounting programs offer. If you’re looking for a guide that will help you make a decision, check out our 2018 buyers guide: best accounting software.
Today, we’re talking about FreeAgent.
alternatives to FreeAgent:
This UK-based company has as its mission to demystify accounting (now there’s a slogan for you) and they do a pretty good job of it. The program is a real pleasure to use thanks to smart design choices that throw overboard common, traditional ways of doing things in favor of rethought alternatives.
Jargon has been overhauled and reports have been made clear: all you really need to operate this program effectively is a small dose of common sense. The biggest downside to FreeAgent is that if you’re not in the UK, you won’t be able to use some of the program’s more advanced functions, most prominently payroll and direct payments.
Since the aim of these reviews is to make life easier for smaller businesses we’ve focused on the things most important to them: tracking revenue and expenses as well as the ability to check these figures against your bank statements.
As with any other accounting software, FreeAgent has some strengths and weaknesses that we’ll cover in this 2018 review. Hopefully, it’ll make your decision easier.
- Easy to use with plenty of opportunity to delve into your own books
- Fast interface that responds great to users
- Designed with the larger world in mind, so plenty of country-specific functions
- Simple pricing scheme
- More advanced functions are often UK-only and this doesn’t seem to be changing
- Basic reports are good, more advanced ones are lacking
Something I like about FreeAgent is that pricing for the ‘universal’ package, which will work for any business anywhere in the world, is $10 every month for the first six months, then $20 per month for ever after. No plans, no exclusive features, just one flat rate.
$ 20 00monthly
- The plan includes all features FreeAgent has to offer;
Pricing – One Plan to Rule Them All
Looking at the whole field of accounting software, this pricing plan puts FreeAgent in a weird spot in accounting-software land: it’s more expensive than others’ cheap plans, yet cheaper than their expensive ones. The deciding factor here is that you get full functionality, so if you need all these functions it’s a great deal, if you don’t you may want to go with an alternative.
One note: pricing can fluctuate a little for versions that are tailored toward specific U.S. and UK entities, but this changes from time to time. Make sure to check when you sign on how your entity type will influence the monthly bill. Either way you get to check it out for free for a period of 30 days.
FreeAgent offers all the basic accounting functions that you will need as well as some more advanced ones, let’s see how those most commonly used by small businesses handle.
One of the two pillars your business stands on, keeping track of revenue will help you keep running effectively. For small-business owners invoicing is the first vital step to controlling incoming money and FreeAgent seems to agree with this sentiment as it works particularly well.
Accounts receivable is found under the ‘Work’ tab; once clicked you’re presented with a two-step invoicing system that is a little different from other accounting apps. Users have to first fill out clients’ contact information like before being sent to a new screen where you enter what you’re billing for and how much the price is.
It seems to be a bit roundabout, but once you’re used to it you realize it’s actually really effective as the program loads new pages really quickly and all that needs to be done after setting up your address book is fill in some numbers and that’s it. It’s quick as can be and extra options, like recurring invoices and credits, are set up by checking a box.
The time-tracking system also feels a bit circuitous at first: you have to go to the projects tab, then click what you’re working on and then either input the time directly or start a timer. From this screen, however, the kept time can be directly exported to an invoice, saving data entry in the long run.
Both these processes seem to be about investing time now so you can save it later which, besides good-yet-ignored advice for a university student, is smart business practice. In the end users save time that they’re better off spending on actual business activity and I like programs that keep that in mind.
All the information put into invoices is transferred seamlessly to your general ledger, so getting an overview is as simple as navigating back to the dashboard. You can send invoices to customers through FreeAgent by clicking a button, so no attaching .pdf files to emails.
Outgoing money can be found under the ‘Billing’ tab and, as unpleasant as it can be, keeping track of it is just as easy as checking incoming cash. You enter bills much the same way as invoices by first entering the vendor in question before coding the expenses they billed you for.
One handy feature I feel deserves mention, even though not everyone will use it, is that credits are entered just like any bill except that all you need to do is add a ’-’ before the amount. Simplicity itself, There’s no need to switch screens or mark boxes or anything.
All bills are transferred automatically to the general ledger, saving you some serious data entry. There’s no direct pay system in the universal edition which means you will have to do that yourself which is a bit of a pity, especially as some competitors seem to offer it.
The ability to link bank accounts to a general ledger for purposes of reconciliation, checking whether in – and outgoing money in your ledger corresponds with your bank statement, is a pretty standard feature now and FreeAgent does a good job. In fact, I was very impressed by how easy it was, it may have been the smoothest set up I have encountered.
Bank Feeds – Easy As Pie
Enter your account number, go through your security questions and the bank feed is operational. The universal edition boasts the ability to link up with banks from around the world, though North American and British ones are best represented.
The updates for these feeds are automatic, so a transaction will pop up in the app within a few minutes of swiping your card.
There is of course room for a small caveat emptor clause: make sure that your bank works with your online accounting software before making a purchase. In the stunning multitude of banks worldwide there are plenty that don’t work with certain programs, and bank feeds are such a handy tool that you want to make sure you can use them.
Reconciling bank statements with the general ledger is easy, all that needs to be done once you your bank statement comes in is set a range of dates, enter the amounts and the program will do the work for you. FreeAgent’s team obviously took a leaf out of QB’s book here, proving that imitation is the greatest compliment.
Payroll is great, but sadly only available for businesses based in the UK. By all accounts it works very well as it links directly with Her Majesty’s Revenue and Customs to allow the taxman to directly withdraw all necessary funds from your business account (yay, I guess?) while paying your employee through the UK version of direct deposit.
The interface is as sleek and no-nonsense as the rest of the program and payroll should be up and running in a few minutes. I was not able to explore too far into it as it requires a British tax number and equivalent of a social-security number to continue and I have neither.
If your goal in life is to make your accountant’s life easier, go with FreeAgent. Though the reports on in- and outgoing cash, tax payments, etc. are on the whole a lot simpler than what some more advanced accounting programs have, they cover everything most users need and almost everything their tax professional does.
Some of the mysteries of accounting are a bit too much to handle for FreeAgent in this case: advanced reports are mostly missing. This shouldn’t be too much of a problem for small companies, but if you’re large and diversified get ready for a large accountant’s bill as he will have to delve into the nitty-gritty of your books to make proper sense of them.
Reports – Demystified. Well, a Bit.
Reports are clear and easy to read; you can easily sort them according to the data that’s most important and then export them to .pdf. The demystification comes into play again here as you should be able to read them just fine without having a bookkeeping primer to hand.
When you start FreeAgent for the first time you’re greeted by a message boasting signing up takes only two minutes; they’re not lying. Despite having to enter quite a bit of information, mostly for purposes of customization rather than gathering personal info, you still end up being done in a jiffy.
Making it Your Own
There’s plenty of customization going on: first off there’s a choice between a universal account or one that’s made tailored toward one of several U.S. and UK entities. A British sole trader or an American S Corp CEO won’t have a very different experience overall but certain tabs will pop up for one and not for the other. Tax forms, for instance, will be different.
The next step is more basic information about how and when your company was founded, how the books were kept before, etc. The last step shows off how internationalized FreeAgent is, so you get to pick from a long list of currencies (all calculated through XE), time zones, the option of using kilometers or miles, etc.
Once through this little gauntlet you’re presented with the dashboard. The payoff for all the data entry just before is apparent immediately: all graphs are in the currency of choice, the clock shows the right time and tabs are set depending on business type. I, for example, had my Schedule C tab right there so the IRS get to know what I’m up to, which means I get to lighten my accountant’s bill by a few bucks.
FreeAgent – Ease-of-Use
Overall the experience of using FreeAgent is great: it looks sleek as hell, tabs always seem to be where they should be and navigation is simple: you rarely need to return to the dash as there’s always a button that will get you straight where you need to be. The dash itself is very informative without feeling cluttered, it’s all at-a-glance info without too many bells and whistles.
Since it is an accounting program with fairly strong traditional roots the average user is going to need some help from time to time with some of the trickier stuff.
Thankfully there’s handy little tutorials for everything and if that fails you can call the friendly people at the helpline. They’re generally only open during office hours in their respective countries, but there are rarely long waiting times.
Overall FreeAgent is a real pleasure to use thanks to its clear layout and well thought out navigation. Novices and seasoned pros will both enjoy using this program as will people with high expectations of the products they buy.
Updates are fairly frequent and consist mostly of new content, announced through the FreeAgent Depot. Currently few to no features seem to be offered or in development, though this may change in the future.
Browsing through forums many users seem to hope that the developers will start working on exporting some UK-only features to a more international audience as there seems to definitely be a client base for them. Payroll and payment links would be particularly welcome.
With FreeAgent you can consider accounting demystified as the program makes the hard stuff easy. With a learning curve that’s fairly easy to master the only thing you’ll need to bring to the table is the willingness to learn to operate it and a small dose of common sense.
If you want to run the financial part of your company right up to the level of your accountant I recommend FreeAgent for most companies, unless they need payroll and they are based outside the UK.
It will also work well for more laid-back entrepreneurs thanks to the high level of automatization.
People who are into some serious accounting may find the program a little light to the touch and not quite give them the punch they need. Conversely, people who really don’t like keeping their books should probably also stay away.