looking forward
May 12, 2014

Do You Have the Right Accounting System?

Matt Jose, Senior Consultant, Technology Solutions

Do you have the right accounting systemSearching for an accounting system is like shopping for a new car. Have you ever test driven a car and found that it did not fit your needs at all? Maybe the seat was too small, there was not enough legroom, the dashboard did not look sharp, or it got poor gas mileage. The car looked great on the showroom floor, but it was not the right fit for you.

Just like cars, accounting systems come in all shapes and sizes; some fit your company’s requirements better than others. Determining whether your current system is the best solution is not always easy, but there are common problems with underperforming systems. Here are the major culprits to watch out for:

Various Workarounds

A workaround is a partial or temporary solution that is put in place because your current system cannot do the necessary things to make it work. The workaround can involve spreadsheets or custom reports when your system does not convert all your data into useable information. It can also take the form of a program or an add-on when your system does not have all the functionality required to process data efficiently.

No accounting system is a seamless fit for any one organization so it is natural to have some workarounds in place to accommodate unique business requirements. However, if you have more workarounds than you have fingers, it is a sign that you have outgrown your current system and need to find a new one.

Slow Performance

As you put more transactions into your accounting system, the database becomes bigger and the system naturally responds slower. Some systems are equipped to handle an increased workload better than others. If you are consistently battling downtime because of slow performance, the first step is to purge some historical data. If performance improves, you can move on for a few years until the issue arises again. However, if it still does not improve, the system is clearly outdated or worn out and cannot keep up with the latest technology. This is a signal that it is time to start looking for a new system.

Outdated Technology

It is recommended that you update your accounting system to the latest version every two years. If your system is more than two years old and you have not brought it up to date, you may be missing out on newer time saving features such as ACH payments and electronic bank reconciliation. Also, if you have more than one business location and your employees work remotely on occasion, you may want to look for a system that has more mobile capabilities.

If you see some of these red flags when assessing your accounting system, it is time to evaluate solution alternatives and think about purchasing a new system to expand your business and improve profitability within your company.

Matt Jose can be reached at mjose@kmco.com or 215.441.4600.

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