How to Set Up Accounting Software for Your Ad Agency
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When you run an advertising agency, your success depends on creativity, collaboration, and smart execution.
But behind the scenes, what really powers your agency’s growth is a financial system that works—efficiently and clearly.
That’s why choosing and setting up the right accounting software isn’t just a technical task—it’s a strategic move.
Whether you’re using QuickBooks Online, Xero, Zoho Books, or FreshBooks, setting things up the right way helps you stay profitable, track your campaigns, and scale your operations with confidence.
In this post, I will walk you through how to set up your accounting software for an ad agency.
Why Setup Matters More Than the Software You Choose
No matter how modern or well-reviewed your accounting tool is, it won’t help you unless it’s tailored to your agency’s actual needs.
The goal is to set up a system that supports:
Project- or campaign-based accounting
Retainer and Recurring Invoicing
Contractor payments and 1099 tracking
Profitability by client or service line
Plays well with other software tools
Setting Up Accounting Software for Your Ad Agency
Step 1: Prepare Before You Start
Start with a clear picture of what you need your system to do.
Gather the following:
A list of active clients, retainers, and projects/campaigns
Client Contract Details (retainer, hourly, flat-fee)
A rough outline of your services and cost categories
Step 2: Customize Your Chart of Accounts
Your Chart of Accounts is the backbone of your system.
Make sure it reflects how your agency operates.
Revenue
Retainer Income
Project (Campaign Revenue)
Hourly Income (Consulting or Strategy Services)
Pass-Through Income (Expenses that client reimburses you for)
Cost of Goods Sold
Direct Labor
Ad Spend (Facebook, Google, etc.)
Contractors & Freelancers
Project Software & Tools
Media Production Costs
Operating Expenses
Salaries, Wages, and Benefits
Subscriptions
Project Management Tools
Office & Administrative Expenses
Marketing, Events, & Client Gifts
Professional Services
Step 3: Enable Project or Job Tracking
If your platform supports it (most do), enable project/job tracking so you can:
Track revenue and expenses per client or campaign
Analyze profitability by job or retainer
Assign time or expenses directly to the work that generated them
Pro Tip: Depending on the platform, this can be called Projects, Jobs, or Tracking Categories. The name doesn’t matter—use them to see which campaigns are profitable.
Step 4: Automate Recurring Revenue
If you bill clients monthly (as many agencies do), make sure to set up:
Recurring invoices
Payment reminders
Email Delivery
This reduces admin work and keeps income flowing without chasing clients.
Step 5: Integrate Your Tech Stack
Your accounting software should play well with other tools.
Consider integrating your accounting software with a dedicated app for:
Time Tracking
Payroll & Contractors
Expense Reporting & Management
Customer Relationship Management
Bill Payment Processing
Financial Analytics
This creates a seamless system where data flows automatically—saving you hours and reducing errors.
Step 6: Build Custom Reports (and Go Beyond)
Most platforms offer standard reporting (P&L, balance sheet)
These are great for getting a snapshot of your financials—but if you want to go deeper that’s where QBO really shines: its ability to connect with best-in-class FP&A tools.
Tools like Syft Analytics, Fathom, Reach Reporting, and Jirav plug into your accounting software and transform your data into:
Visual dashboards for client performance
Forecasting tools for future cash flow and hiring plans
Custom board-ready reports with charts and KPIs
Budget vs. actual comparisons across campaigns or departments
These integrations are especially valuable for ad agencies managing multiple retainers, seasonal campaigns, or planning to scale.
Common Mistakes to Avoid
Even the best software won't help if it's poorly set up. Here are common missteps:
❌ Don’t Use Default Settings
Customize your chart of accounts, tracking categories, and workflows for your agency’s needs.
❌ Not Fully Utilizing Integration Capabilities
Manual entry wastes time. Connect time tracking, payroll, and receipt tools wherever possible.
❌ Skipping Project or Campaign Tracking
Without this, you won’t know what’s profitable and what’s draining your resources.
❌ Not Reviewing Reports Regularly
Set a monthly date to review key financials. Make decisions from data, not guesswork.
Download Your Free Accounting Software Setup Checklist
Setting up ad agency accounting software doesn’t have to be overwhelming.
👉 Download the Accounting Software Setup Checklist for Ad Agencies
Final Thoughts
Accounting might not be the glamorous side of agency life, but it’s what keeps the lights on and the creative flowing.
By choosing the right tools and setting them up well, you gain the financial clarity to scale with confidence.
Your software should work as hard as you do.
Set it up right—and let it power your agency’s growth.
The Accountant’s Palette helps creative business owners implement the right financial systems—from QuickBooks setup to monthly reporting and strategic forecasting.