Discern Needs Before Buying Accounting Software

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Reprinted From: The News Journal
Written By: Richard P. Sommer, CPA & Michael Bufano
Myriad computerized small-business accounting systems are available to help small-business owners manage and track such bookkeeping issues as payroll, billing, accounts receivable and expenses.

These programs range in cost from $60 to $200. The higher-end programs allow more customization fee reports. The less expensive programs generally do not provide for modifications.

Most of the programs offer a similar service agreement, usually 30 days of free service after startup. Thereafter, the customer pays for technical support on a per-call basis.

Programs to consider include One Write Plus, ACCPAC Simply, DAC Easy, MYOB, Quickbooks and Peachtree Complete. All are geared to the Windows system.

But buying the program is not a panacea; knowing how to set up and use all the functions is crucial. Since many employees will not have the background to use the software, training will be necessary. It is important to commit a significant amount of time in training to fully understand how the program functions. Many companies send their employees to training classes or hire outside consultants.

The minimum hardware and operating requirements vary from system to system. Generally 8 megabytes of random access memory with a 486 system is recommended. Sixteen or 32 megs of RAM may be preferable if multiple programs are open at the same time.

Quickbooks and Peachtree Complete are two systems that appear to be more commonly used by small businesses. Quickbooks is targeted more for the smaller business and Peachtree Complete for the expanded small business.

Quickbooks takes a what-you-see-is-what-you-get approach to input. Business users having little accounting background quickly adapt to the input screens for invoicing and check writing, which closely resemble the check and invoice produced at the printer.

The user will not be encumbered with monthly or year-end closing procedures commonly found in competitors' products. Quickbooks comes with more than 90 predefined reports and graphs. Separating itself from its competitors, Quickbooks is able to drill down to obtain detail from all reports.

This means it can view data on a summary level and by clicking on appropriate areas will have the ability to zoom in on a specific area in greater detail. Quickbooks 5, just released this year, includes improvements in areas such as customization of forms and online banking.

However, it still lacks some of the more comprehensive accounting features found in other software packages. Also, multiple security levels are not as flexible as in some of the other packages.

Peachtree provides more levels of security. Users with more accounting knowledge will fully appreciate this system's range of capabilities. Two of the most unique features are a fixed asset module and a network version in which two or more users can assess Peachtree simultaneously. Such features are generally found only in higher-priced packages.

Customization of checks, sales invoices and purchase order forms is possible, but it can be somewhat difficult depending on the level of change desired from the standard format. Also, if online banking is essential to the business, Peachtree will not be able to satisfy this need.

When selecting the appropriate small-business accounting system, it's important to prioritize the company's needs and talk with various vendors. Also talk to other owners in similar industries to find out what package they are using and how it met their needs.