Much more than other packages we've reviewed FreeAgent has been designed with a particular user in mind. That user is a contractor or freelancer that probably doesn't issue that many sales invoices a month and has a fairly simple set of costs.
This review is going to with that user in mind. A bigger business dealing with a handful of employees and loads of transactions will still be able to use FreeAgent but might not find it as easy to use.
The Overview Page
FreeAgent's overview page is nice and comprehensive. It has everything that you would want to see to get a quick snapshop of your financial position.
A nice addition is a comprehensive tax calendar. Not only does it alert you to deadlines but if you've prepared the necessary documents (which the demo account below hasn't) you will see the amounts owed to HMRC so you can plan your cashflow accordingly.
Worth noting is that this page also includes 'Active Projects with Unbilled Items'. Something we think is unique to FreeAgent. If you work on a time and materials basis and only invoice at the end of the project or after achieving particular milestones this can be really useful. It might also give you the kick you need to progress the project to a stage you can invoice at.
There's no bankÂ reconciliationÂ page in FreeAgent, but once you upload your transaction data there is a neat page for allocating each payment.
The 'type' dropdown menu covers most eventualities.
You can allocate a cash payment to an expense account and put in a little description but if you do this you won't be able to track supplier information as well as if you hadÂ separatelyÂ raised a purchase invoice and then allocated it to the payment. That's not too bad a thing but it would be nice to have a truly bank statement driven accounting system.
At the time of writing FreeAgent are just getting started on automated bank feeds. They're currently (May 2012) available for Barclays account holders but no other banks.
The alternative approach of manually uploading a spreadsheet of transactions is easy though. We struggled to upload a CSV file (there is no standard format for CSVs so they are generally a bit harder for computers to interpret),Â if you can export from your bank as an OFX or QBO file it should all be plain sailing.
There's not much accounting language to confuse users in FreeAgent. Sales related activities all sit under a heading called 'Work', purchases under 'Bills' and personal expenses are 'Expenses'. All simple enough.
If dig into the accounting menu you will come across some technical accounting words but if you have an accountant that works with FreeAgent you shouldn't have much need to go in there. If you don't have an accountant you'll have to learn anyway!
With contractors in mind, FreeAgent is very easy to use and anyone should be able to get started in no time at all.
If you're not a contractor you shouldn't have any problems either but you might find monitoring and allocation a large amount of transactions much more time consuming than you would if you were using Xero.