October, 2008

When a prospective lender or investor asks for specific financial data and reports, what do you think happens if you provide more detail and greater clarity than requested?

Likely, two mindsets get ingrained in the stakeholder’s head: You know what you’re doing; and you’ll continue providing the type of accounting system software information needed efficiently and predictably.

That sets a positive tone from the outset, and conveys a sense of professionalism and competency that will go a long way with just about any astute businessperson.

This is just one of myriad examples of how top-notch accounting software can pay constant dividends. These are the type of hidden benefits that await savvy accounting software buyers.

Here are just a few of the ways that appropriate accounting solutions can continue to impress stakeholders:

• Ramp up report generation. If your investor wants quarterly updates, provide monthly ones—and look that much more astute and aware. With the right kind of accounting software, this process can easily be incorporated into a regular routine.

• Encourage “surprise inspections.” Another way to impress stakeholders is to offer reactive as well as proactive accounting services reporting. Make it known that you stand ready to provide salient information whenever they need it.

• Tout the software itself. If you’ve installed prestigious accounting solutions that demonstrate your commitment and ability to expand within an accounting system software framework, that in and of itself can impress stakeholders. Not to denigrate homegrown or entry-level systems, but such powerhouses as Microsoft Dynamics GP or SL likely will instill confidence—and reinforce a sense that your company, and its information, can be trusted.

• Demonstrate data “flexibility.” Show CPAs highly technical financial reports, and they’ll likely be satisfied. But what about the potential investor who made his or her money as a salesperson? Or the financier whose top passion is customer relationship management? Being able to generate reports that can provide data relevant to the recipient’s knowledge base and comfort zone can make the difference between a warm reception and a cold shoulder. Being able to recast that data accurately and efficiently for a variety of different audiences also is critical.

If you don’t think more regulation is coming, think again. Just today Bloomberg reported, “Former Federal Reserve Chairman Alan Greenspan said a ‘once-in-a-century credit tsunami’ has engulfed financial markets and conceded that his free-market ideology shunning regulation was flawed.”
Increased regulation, regardless of form, undoubtedly will affect corporate financial recordkeeping. Small to mid-sized businesses lacking accounting software that provides accurate and in-depth financial reporting had better start rethinking their accounting solutions now—before regulatory requirements force them to rethink—and revamp—later.
So, what do you need to help ensure compliance with regulations not even enacted yet?

• Ask questions about what’s coming—then evaluate. Do online research, visit online social/business networking sites where pertinent topics are being discussed, query industry trade organization authorities, read pertinent articles, talk to trusted advisors. Get educated about what’s likely coming, so you can stay ahead of developments.

• Beef up accounting software to meet future requirements as well as today’s needs. As we all know, when government ramps up regulation, resulting mandates don’t always appear logical. So, make sure your accounting system software can handle anything even remotely on the radar screen post-election. This means accounting solutions that can handle “heavy lifting” today, and can be updated as new developments dictate.

• Don’t be pennywise and pound foolish. In the rush to belt-tighten, don’t pinch pennies on under-powered, under-performing accounting software. It doesn’t take many hours of CPA or legal fees spent dealing with regulatory non-compliance to offset any savings from buying lower-priced accounting solutions. To get specific, look at a QuickBooks Upgrade. If you have a small company whose financials can easily be handwritten on a spreadsheet, you’re likely okay with QuickBooks, upgrade or not. But, if you have any degree of complexity, a pattern of company growth, multi-level security requirements, multiple concurrent accounting software users, or any other expanding scenario—look at such heavy duty solutions as Microsoft Dynamics GP or SL.

How does reputable mid-market accounting software reward those who implement it? Let me count the ways:

►Avoid data theft/compromise by disgruntled employees. Mid-market accounting software should include sophisticated theft deterrent features. Care to add up the potentially catastrophic costs of an employee selling sensitive personal data to outside parties? For starters, there’s the expensive and time-consuming process of informing affected parties and offering remediation recommendations. The bad press generated by such an event can destroy a company as present customers pull their business and prospects rule out the company because of the breach.

►Increase productivity and motivation of accounting employees. When employees discover that there are accounting solutions that can make their job easier and more productive, one of two scenarios likely results: they’re really frustrated because their company doesn’t have it; they’re really grateful that their company has it. This ranges from the most minute data entry tasks to ability of concurrent users to get on the system immediately versus waiting for colleagues to log off. It encompasses immediate generation of on-screen information and printed reports.

►Develop a more productive overall workforce. Providing the right types of financial information to everyone from the sales department to fulfillment clarifies roles, responsibilities and objectives. Clear communication of reliable and timely financial information using the right accounting system software generates clear and crisp results; murkiness begets murkiness.

►Keep regulators off your back. Anyone who’s experienced regulation difficulties will attest to their costly, time-consuming and productivity-draining nature. Accounting solutions that handle regulatory issues competently will yield many dividends—both monetary and in peace of mind.

From Roosevelt to Roosevelt, the message is clear: Our biggest enemy is inability or unwillingness to act constructively when adversity strikes.

Teddy Roosevelt said, “In any moment of decision, the best thing to do is the right thing, the next best thing is the wrong thing, and the worst thing you can do is nothing.”

FDR proclaimed, “The only limit to our realization of tomorrow will be our doubts of today.” He’s also responsible for the famous line from his first inaugural address: “…the only thing we have to fear is fear itself—nameless, unreasoning, unjustified terror which paralyzes needed efforts to convert retreat into advance.”

Unfortunately, too many small-to-mid-sized businesses operate mainly from a place of fear. At the first sign of a downturn, they start tuning out the cacophony of bad news by burying their heads in the sand. Of course, once you bury your head in the sand, you—and your company—will run out of life-giving oxygen rather quickly.

Fear drives more business failures and economic malaise than any other downturn-related factor. Hope, determination and perseverance are the antidotes.

At this uncertain time, I call upon small to midsized businesses of America to find renewed hope, fortify it with determination, and rely on perseverance when the going gets tougher.

As the nation struggles with the ramifications of a $700 billion federal bailout, US companies need to look long and hard at ways to buck up their own financial performance.

Accounting software can have substantial positive (or negative) impact on company balance sheets. If the engine that propels businesses is sales, then a major ingredient in the fuel for that engine is accounting software.

Following are just three of the myriad ways that accounting software can help make (or break) company financial performance:

• Tight integration with Customer Relationship Management (CRM) programs. Robust accounting solutions provide a treasure trove of accurate, current information that can be used to solidify relationships, build loyalty, and increase sales. Based upon this information, customer service representatives immediately can look at longevity, loyalty and payment history. From there, the representative can reward good customers with favorable offers (encouraging further loyalty and sales), or restrict a future relationship (cutting potential losses).

• Accounting software offering rapid access to the right information can smooth out cash flow crunches—potentially very critical amid credit tightening and general economic distress. Extensive and accurate financial reporting can be a huge asset when attempting to identify “low hanging” receivables, determine optimum times to pay vendors, and control expense creep. Often, accounting software decisions are viewed solely from the initial cost perspective. Decision-makers don’t consider the substantial losses that can occur when accounts are left uncollected for too long, or expenses run amok because of inadequate controls and tracking.

• Seamless connection to the entire supply chain can provide the most cost-effective decision-making possible. Being able to optimize inventory tracking and ordering, efficiently identifying and acting on positive and negative supply chain situations, and spotting buying trends that can impact future performance are all capabilities of sophisticated accounting system software.

An integral part of the entire accounting software picture is evaluating how best to upgrade to/implement a new system. Getting up to speed without slowing productivity to a crawl is critical. Make sure any new upgrade or accounting system software being considered offers automated setup, self-directed training and competent, understandable customer support throughout implementation.

By being wise in choice of accounting software and efficient in deploying it, companies can avoid having to bail themselves out of a mess later.

It’s October 1, 2008. Do you know where your QuickBooks® accounting software is? According to a BusinessWire news release, they’re now at version 2009.

The release points out a variety of new features designed to improve online accounting services and communications. It also talks about “small businesses” finding more ways to get ahead and make more money using the newest QuickBooks upgrade.

I don’t doubt that this QuickBooks upgrade is more full-featured. I can see where the new bells and whistles will speak to some needs of small business owners.

What I didn’t see, in the news release anyway, is discussion of QuickBooks 2009’s ability to handle a higher number of concurrent users, higher overall transaction numbers and the like.

That’s not a knock on QuickBooks accounting solutions. It’s just a reminder that every accounting software application has its limitations. QuickBooks can work well for small businesses whose needs are moderate. When it begins to move slowly, both in terms of processing information and generating reports, or when people have to start waiting in line to get on the system, it’s time to consider a QuickBooks upgrade—to another accounting software manufacturer.

Obviously, I’m a fan of Microsoft Dynamics accounting software as a logical next step for companies seeking higher transaction capabilities, faster performance, and ability to handle substantial company growth in the small-to-midsized arenas.

Here are six areas to examine when you’ve determined that new accounting software is a must, or you’re moving in the direction of more robust and scalable accounting solutions:
1. Evaluate expected transaction levels
2. Determine required level of financial reporting.
3. Calculate number of expected simultaneous users.
4. Establish desired level of accounting services monitoring.
5. Make sure the accounting software integrates with business applications familiar to employees
6. Decide what level of security is appropriate with the new accounting software.

Is there an accounting software upgrade in your near future? If so, don’t land in quicksand by selecting accounting services that will drag your business down instead of lifting it up.