Accounting for growth
In the accounting world, dusty ledgers are being replaced by digital dashboards and owner-managers have a real-time view of how their firm is performing.
Nowadays an SME owner-manager has a range of accountancy software solutions to choose from that can be used to take a firmer grasp of the business as a whole.
While most companies' core business solution requirement will be an accounting product, more and more companies are realising they have requirements for other features that work with an accounting system to help them keep an electronic eye on their business.
Alan Connor, commercial director of Exchequer Software, explains how his company's product Exchequer is an example of why 'one size fits all' isn't practical for SMEs' accountancy needs: it has a number of add-ons or modules customers can choose from according to their needs.
It provides industry-specific solutions meaning clients have all the benefits other Exchequer users have, using 80pc of the software with the additional 20pc specific to their needs.
Very common functionality required in the Exchequer user base is "ordering, delivering, looking at sales analysis, pipelines, margins, stockholds, locations", says Connor, and the need to give owner-managers a huge element of control over their business, he explains.
Whether companies opt for an industry-specific solution depends on their size. "It's only as they continue to grow and become more proficient they will look at different ways of making sure that the stock levels are maintained or making sure they achieve a certain consistent margin across a product they sell."
Similarly at Sage, explains Jessica McIntire, product manager at the company, it is typically after a few years owner-managers realise they need other functions or are curious as to what else they could do with their business if they had a more varied accountancy solution.
At that stage, she says, where a person needs to start keeping a closer eye on the business, they would move to Line 50 Accountant Plus which has a full job-costing module. She adds that any requirement to manage stock, sales, purchase orders and so on could be done through Line 50 Financial Controller.
The benefits of having these additional features, McIntire comments, is at the initial stages for an SME owner-manager "just getting organised and having that place to put your information". "When you get past that point the real benefits are the efficiency," she adds. "Once you have a bulk of information it really starts to be able to tell you about your business."
SME owner-managers need these features, says Connor, because "they want to save money and time; they want to automate time-consuming processes. They want to be able to deliver a faster and better level of customer service which not only benefits the customer but also frees up the staff time. They want to be able to review and look at activity, look at what's happening in the business within the accounts software and be able to control that rather than having to go out and stand in the different departments and pull apart different paper and files."
Within Sage's Line 50 and Tas products there's been a development in how management do all this, using 'dashboards' to give them a quick snapshot of areas in programmes, eg the top three customers, the biggest outstanding balances from customers, how the company is keeping track of chasing up on debt.
McIntire says: "Without anybody having to go in and request the report it constantly updates itself. It's literally a snapshot at that point in time that you're looking at the product."
A step further is business intelligence software Sage Intelligent Reporting Line 50, a business intelligence software which takes data into the product, formulates and categorises the data in a particular way and sets it up for really fast reporting. Rather than having to go to the business analyst or finance person it means the manager can essentially do it themselves and create a business intelligence report very quickly.
The internet is also playing a part in how the features offered by accountancy software can be enhanced. With Exchequer users can dial in from multiple sites to Exchequer via virtual private networks. In addition, web sales can go straight into the Exchequer system with the Exchequer eBusiness module meaning no more rekeying of information, no delays and the information is live.
In the next 12 months, Sage Line 50 Online is expected to be launched. This is currently for accountants: the company user can input all relevant data into the system where the accountant can access it remotely, saving both sides time travelling to meetings. An existing Sage product, Coretime, can be deployed over the web where users go online to track their time and their work against projects to give an overall view of how time is being spent and how efficient they are being, which is important for companies who bill clients per hour.
Another solution in development would reduce headaches all round – instead of going from a supervisor to manager to human resources and back it would allow employees to get their holiday leave signed off online.
Case study: Greyhound Waste
Greyhound Waste, a recycling and recovery company, upgraded to a newer version of Sage Line 50 Version 12 accounting and management software system because it required a method of measuring the profitability and costs of each of its service areas as well as the profitability and costs of its depots, explains Fintan Meagher, group financial director, Greyhound Waste.
In addition, it opted for the Sage Intelligent Reporting system. "Sage Intelligent Reporting has not only enabled us to get the most out of Sage Line 50 but it has also allowed us to quickly drill-down to isolate problem areas or opportunities, and to better understand the financial details that have given rise to those," says Meagher. "The Sage solution is easy to use and it enables us, a complex organisation, to pinpoint areas that require action, thereby empowering us to take appropriate action," he concludes.
Case study: Adston Construction
When Co Cavan-based Adston Construction Ltd realised it needed integrated financial and job costings, which couldn't be done on their existing accounting system, it was time for change. Olivia Smith, finance director, states that they chose Exchequer because in addition to catering for the company's core financial requirement it had job costings which could be accessed in a quickly manner.
"With Exchequer the ease of access of information and the clarity of the information is a huge plus; these are things that stand out."
One of the major advantages of job costing, she continues, is "it allows the information to be laid out in a manner familiar to a contract management team".
"You can see the variant, you can see are you coming online or are you not. Hopefully you'll see it early enough to make a decision on another stage so that overall the job will come in at the same percentage as we wanted at the budget as opposed to the general ledger which just records information for the whole company."
By Elaine Larkin
Pictured - Jessica McIntire, product manager, Sage Ireland