Accountancy software

Winning new business, increasing your profit, meeting customers. These are the things that give you a buzz and help to build your business.

But there’s no avoiding the fact that the software that manages your accounts is the backbone of the operation. When it comes to changing or improving your current system it’s not easy to pick the right package.

For a start there are more suppliers than ever to choose from as the likes of SAP, normally associated with bigger businesses, have decided to tap the entrepreneurial market. Then there is the evergrowing range of products available from boxed off-the-shelf packages to more tailored bespoke IT solutions which affect all parts of your business. Adding to the problem is that for most businesses, accountancy packages are a one-off purchase unlikely to be repeated so no CEO or FD could ever need to, or expect to become an expert.

THE NEED FOR CHANGE

The most important question for your business is whether you need to change your accountancy software.

In some cases the need for change will be obvious: it could be that you may be keeping your information on different databases; that a client demands you start delivering information in a different way; or that your system is simply too old and clapped out to meet your needs. In other cases the need for change will be less obvious. The tendency to milk software beyond its useful life is a common trait among smaller businesses. In this case your business may be missing out on functionality which could help your staff save time and work more efficiently. If, for instance, you spend a lot of time importing and reformating data in Excel then it is probably time for your business to look at upgrading or changing.

Rick Holroyd has been through the process of change recently with his contract catering business, Holroyd Howe. Having expanded his business using Sage Line 100 software for six years he decided the company needed something more sophisticated to meet a variety of needs which had emerged as the company got larger. “Being in the catering business we have a disproportionately large purchase ledger. It has to handle 9,000 invoices a month from suppliers for items like groceries that are ordered daily,” says Holroyd. “We also want something that can extract financial data in one way and present it in a greater variety of formats to suit clients’ differing requirements.”

And so the company swapped from its Sage package to a Microsoft solution. Holroyd saw the switch not just as a pure software purchase, but as an investment in the business, and advises other companies to do the same.

“Don’t go for something that will just do. It’s wise to invest in the infrastructure of the business. But always ask ‘what is the benefit for the organisation?’“ he says. Your accountancy software is there to make your business function more easily and allow you to see the figures which help you make the right decisions. If it isn’t, you end up wasting time and money on something which doesn’t work for your business, as Cathy Humphreys, finance director of recruitment company MaydayExec, found in the past. After a hiccup with one system, she switched to an Access Accounts package after it was suggested by an employee who had used the software before.

“Interestingly enough when our auditors saw it in action they decided to buy it too,” says Humphreys. “People should be really sure before they commit themselves to a package otherwise you waste money and time transferring data to a system that may not be right.”

WHERE TO START

The biggest mistake is to begin researching software before you take a good long look at your business. Veda Snyman, who is the product marketing manager, at Microsoft Business Solutions says before you think about researching out in the market you should look closely at your own business to decide what you need to do and what you want to do, to progress further.

“You should ask yourself what are the pain points, what information you need and what information you are lacking in your business,” says Snyman. “The pain points could be manual processes which could be automated or processes such as order taking which could be simplified.”

The trick here is to involve your staff at an early stage and ask them what they need and what problems they are currently facing rather than trying to impose a solution on them.

Whether you are a large or small business you should be looking for input from heads of department such as your finance director, sales director and purchasing manager. That way you will be able to answer honestly what your needs are and get a full view not just of the accounting process but other functions which may have a need for data. This will help you decide the scope of the project. That is: whether you simply want a system to supply useful financial information or whether you want something more sophisticated that can integrate with areas including invoicing, order processing and payroll; whether you can upgrade or whether you need a completely new system.

If you feel this process is daunting, it is possible to get help through an IT appraisal. Many accountancy firms now have specialists who will do this for you. If not you can go to an independent IT consultant or a reseller. Either way you get a valuable external view of your business and its processes from someone who is well-placed to identify the issues affecting your business and recommend areas of best practice which you may not be following.

Nick Hood, senior partner at insolvency specialists, Begbies Traynor, is one of many who advises businesses to err on the side of caution when you are drawing up your wish list. In his view, these days most accounts packages will extract information and give you the key figures you need. The thing to think about is, what level of sophistication do you think that your business demands.