the insiders guide to choosing accounting software
The first question you should ask is what do you need it for?
There are many different applications out there and any number of sales people willing to sell you what they have on their shelf.
Some common reasons for purchasing accounting software are:
- To create invoices for my customers.
- To “do my own books” and save money on accounting fees.
- To see whether I am making money on the work I do or the products I sell.
- To work out what GST I have to pay to the Inland Revenue Department.
- To have more free time for other things in the business.
These are all good and valid reasons. Most businesses now have a computer, and most could do with at least some of the features offered by modern accounting software packages. So…..
Do you have the necessary office experience?
You will need to know what you are doing. Accounting software is just a tool for doing an existing job. It allows you to do what you would ordinarily be able to understand and do, but only better and faster. It will not make you an accountant. Look to get some training if you haven’t done the job before, and don’t expect to know how to do everything an experienced office administrator or accountant would be able to do without that training.
What do you want to do with the accounting software?
Get some help here, as your level of expertise and your requirements will determine the kind of software you need and the amount of money you will need to spend, both on the software and the training to use it. There are many different types of packages, and not every package will do what you think it should. Most are only partially customisable so ask lots of questions of your vendor before committing to the purchase. Talk to others with your type of business to see what they do and use.
Do you need to pay for training?
All software requires training from an experienced operator. Remember it will be cheaper in the long run to get the correct training than have someone fix your mess and then still have to train you. Ask for the cost of training to be included in any quote so you can “compare apples with apples”.
What about on-going support?
It is imperative you choose a package where you can get on-going support for technical and accounting issues. Computer software is never perfect, we don’t know everything and of course we all have the “human factor”. Count on things to go wrong at some time, and be prepared by ensuring you have the right support on hand when the inevitable happens. Remember that in business down-time can lose you customers and frustration is inevitable.
So what is the best accounting software?
It will depend on your requirements and budget. Get the best you can afford, remembering that the initial purchase is only one component of the total cost. Get good advice from someone in the business of selling and supporting the package you are interested in. Your accountant is a good one to ask, but remember he or she may not be an expert with software packages, so get advice from a number of reliable sources before deciding. Ask other people in your type of business, as often specific packages suit different types of business. Your cousin or the guy at the pub is probably not the best person to ask. Ask your vendor for testimonials from their existing customers.
How much time will it take to look after your own books?
You will need uninterrupted time to use any accounting software correctly. It will take time, and sometimes lots of it to keep your own books in order. Most big firms have an accounting department to look after their finances, so in buying an accounting package, you will gain a number of roles, most of them extra to the work you are already doing in the business. If you don’t have the time yourself, you might want to consider employing someone part-time to look after that function. Remember though, that the person you choose must be suitably qualified and have the time to do the job properly. It’s not a good idea to give the accounting function of a busy business to your wife to fit in after she has cooked the dinner, cleaned up the dishes and put the kids to bed. She will not appreciate it and mistakes are often amplified.
Will your computer handle the software?
An often overlooked issue is getting your new software to run correctly on old outdated computer hardware. Before committing to purchasing any software, ask the vendor to look at and audit your computer system. Up-to-date accounting software is designed to run on the latest computer hardware, and often old machines mean sluggish performance and reliability issues. Do yourself and the vendor a favour by ensuring your computer system is modern and able to meet the performance requirements of the software. Also make sure your printer is compatible. More often than not, you should budget for some new hardware when you are deciding on the right accounting package for your business.
Finally……
Don’t rush, take your time and talk to experts. It will probably cost more than you initially thought, but the old adage of “you get what you pay for” certainly applies if you want to do the job properly (and once).