Accounting software is definately not OSS's strongest field, but I've heard good things about SQL Ledger. It's released under version 2 of the GPL, so it's free as free can be (flame away ;-).
Also, about the following:
Naturally, we'd prefer that the software be open-source (not necessarily free)
Other than support or pretty packaging, I don't see a reason to pay for OSS. If you check out the OS definition (particularly the parts about free redistribution) you'll find that any compliant license ultimately enables you to receive the code for free.
Another note, if you're combining this with proprietary software, make sure to read Combining work with code released under the GPL in the GPL Faq (or preferably get a lawyer to do it).
Searches on SourceForge and Freshmeat might be useful as well (if you haven't already checked them).
Best of luck and let us know what you decide on :-).
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