How to select the right accounting software.EXECUTIVE SUMMARY * THE INTERNET IS CHANGING the way businesses do business, and that means business managers must rethink re·think tr. & intr.v. re·thought , re·think·ing, re·thinks To reconsider (something) or to involve oneself in reconsideration. re what they expect from their accounting software. Your software should be able to * Publish Web catalogs directly from, and make links to, the software's inventory module, which means customers can see, among other things, real-time 1. real-time - Describes an application which requires a program to respond to stimuli within some small upper limit of response time (typically milli- or microseconds). Process control at a chemical plant is the classic example. information on prices and quantities on hand. * Retrieve orders directly from the Web site and import them automatically into the sales order The sales order, sometimes abbreviated as SO, is an order received by a business from a customer. A sales order may be for products and/or services. Given the wide variety of businesses, this means that the orders can be fulfilled in several ways. module. Print all reports to a Web page format. * Allow users to access reports and accounting data across the Internet. * WITH INTERNATIONAL SALES GAINING, even for smaller businesses, your accounting software system should be able to handle foreign currency, including fluctuating fluc·tu·ate v. fluc·tu·at·ed, fluc·tu·at·ing, fluc·tu·ates v.intr. 1. To vary irregularly. See Synonyms at swing. 2. To rise and fall in or as if in waves; undulate. v. exchange rates. * WHILE IT'S it's 1. Contraction of it is. 2. Contraction of it has. See Usage Note at its. it's it is or it has it's be ~have HARD TO RATE software user-friendliness, it should at least have the following attributes: graphic guidance, default-rich settings and a "look and feel" that's comfortable to all those who use the product. * THE SOFTWARE MUST address the Y2K bug Y2K bug or Year 2000 bug or millennium bug Potential problem in computers and computer networks at the beginning of the year 2000. Until the 1990s, most computer programs used only the last two digits to designate the year, the first two digits being . Some software is fully compliant and other packages are only compatible; it's best to have compliant software. Handling the Web and international commerce. The Internet is changing the way businesses do business, and that means business managers must rethink what they expect from their accounting software. The Internet is transforming the retail channel--from an elaborate distribution system with wholesalers, distributors and a vast array of retailers to a simplified system in which a growing number of sales are made directly to the consumer. For manufacturers of both consumer and industry products, that change translates into generally lower over-head--and new demands on accounting systems. Recognizing this trend, many accounting software vendors have added features designed to accommodate the Internet. The new functions include the ability to * Publish Web catalogs directly from, and make links to, the software's inventory module. This means customers can see, among other things, real-time information on prices and quantities on hand. * Retrieve orders directly from the Web site and import them automatically into the sales order module. Print all reports to a Web page format. * Allow users to access reports and accounting data across the Internet using a password. * Let remote users securely enter accounting data and transactions via the Web. * Track an order automatically via links to tracking pages of Federal Express or United Parcel Service United Parcel Service, Inc. (NYSE: UPS), commonly referred to as UPS, is the world's largest package delivery company, delivering more than 15 million packages[1] a day to 6.1 million customers in over 200 countries and territories around the world. . * Allow users to send e-mail reports to users or groups of users. * Configure See configuration. (software) configure - A program by Richard Stallman to discover properties of the current platform and to set up make to compile and install gcc. Cygnus configure was a similar system developed by K. a system to automatically send e-mail reports and messages when triggered by predefined events. Exhibit 1, page 69, lists the Internet features of leading accounting software products. Three accounting software vendors at the forefront of Internet applications are Great Plains, SBT SBT Symplastin bleeding time and RealWorld. All three provide Web sites where prospects can test the Internet features they're they're Contraction of they are. they're be interested in. At the Great Plains site, users can log on and operate Great Plains Dynamics C/S See client/server. + across the Internet. SBT's site provides links to more than 200 companies that use the SBT Web-Trader module to sell goods and services In economics, economic output is divided into physical goods and intangible services. Consumption of goods and services is assumed to produce utility (unless the "good" is a "bad"). It is often used when referring to a Goods and Services Tax. across the Internet. Real-World's Web site allows users to log onto a virtual Web store that can be created in less than 30 minutes using the RealWorld Expertise new Web site wizard Instructional help in an application or system development environment that guides the user through a series of multiple choice questions to accomplish a task. For the most part, wizards are more effective than the help menus found in most applications, which often border on the atrocious. . Simply answer a few dozen questions and Expertise generates a complete, ready-to-run Web site using data and graphics contained in the inventory module. The resulting site is linked automatically to the accounting data, as are sales tax sales tax, levy on the sale of goods or services, generally calculated as a percentage of the selling price, and sometimes called a purchase tax. It is usually collected in the form of an extra charge by the retailer, who remits the tax to the government. , discounts and freight charge calculations.
Exhibit 1: Internet Features of Accounting Software
Produces a Retrieves
Ready-to- Orders
Publish From the
Web Catalog Web
For the low-end market
BusinessWorks for Windows 12.0 No No
M.Y.O.B. Premier 1.0 No No
Peachtree Complete Accounting
for Windows 6.0 Yes Yes
QuickBooks Pro 6.0 No No
For the middle market
ACCPAC for Windows Series 4.0(*) No Yes
Great Plains Dynamics 5.0 No No
MAS 90 for Windows 3.X(*) No Yes
Navision Financials Yes Yes
Peachtree 2000 4.0 No No
Platinum for Windows 4.6 No Yes
RealWorld Expertise.LAN 5.0 Yes Yes
SBT Professional Series 5.0 No Yes
Solomon IV for Windows 4.0x(*) No No
Traverse 8.3 No Yes
Visual AccountMate 4.0 No Yes
For the beginning ERP market
Acuity Applications 4.0(*) No No
Great Plains Dynamics C/S+ 5.0 No Yes
Platinum ERA 4.2 No Yes
RealWorld Expertise.SQL 5.0 No Yes
SAP Accelerated Financials R/3 No Yes
SBT Executive Series 3.10 No No
Solomon IV for BackOffice 4.0x(*) No No
Prints Supports
Reports to Remote Data
HTML Entry Via
Format the Web
For the low-end market
BusinessWorks for Windows 12.0 No No
M.Y.O.B. Premier 1.0 No No
Peachtree Complete Accounting
for Windows 6.0 No No
QuickBooks Pro 6.0 No No
For the middle market
ACCPAC for Windows Series 4.0(*) Yes Yes
Great Plains Dynamics 5.0 Yes No
MAS 90 for Windows 3.X(*) Yes No
Navision Financials Yes Yes
Peachtree 2000 4.0 No No
Platinum for Windows 4.6 Yes Yes
RealWorld Expertise.LAN 5.0 Yes Yes
SBT Professional Series 5.0 Yes No
Solomon IV for Windows 4.0x(*) Yes Yes
Traverse 8.3 Yes Yes
Visual AccountMate 4.0 No No
For the beginning ERP market
Acuity Applications 4.0(*) No Yes
Great Plains Dynamics C/S+ 5.0 Yes Yes
Platinum ERA 4.2 Yes Yes
RealWorld Expertise.SQL 5.0 Yes Yes
SAP Accelerated Financials R/3 Yes Yes
SBT Executive Series 3.10 No No
Solomon IV for BackOffice 4.0x(*) Yes Yes
Supports
Ability to
View Reports
Across the Web
For the low-end market
BusinessWorks for Windows 12.0 No
M.Y.O.B. Premier 1.0 No
Peachtree Complete Accounting
for Windows 6.0 No
QuickBooks Pro 6.0 No
For the middle market
ACCPAC for Windows Series 4.0(*) Yes
Great Plains Dynamics 5.0 Yes
MAS 90 for Windows 3.X(*) Yes
Navision Financials Yes
Peachtree 2000 4.0 No
Platinum for Windows 4.6 Yes
RealWorld Expertise.LAN 5.0 Yes
SBT Professional Series 5.0 No
Solomon IV for Windows 4.0x(*) Yes
Traverse 8.3 Yes
Visual AccountMate 4.0 No
For the beginning ERP market
Acuity Applications 4.0(*) Yes
Great Plains Dynamics C/S+ 5.0 Yes
Platinum ERA 4.2 Yes
RealWorld Expertise.SQL 5.0 Yes
SAP Accelerated Financials R/3 Yes
SBT Executive Series 3.10 No
Solomon IV for BackOffice 4.0x(*) Yes
(*) Vendor reports that these features are either available through third-party add-on A purchase of additional goods before payment is made for goods already purchased. An add-on may be covered by a clause in an installment payment contract that allows the seller to hold a security interest in the earlier goods until full payment is made on the later goods. products or are expected to be available this year. So, whatever your immediate Internet plans, be sure to assess an accounting product's Web-readiness. As Internet importance grows, Web-enabled features will become more critical to a business. THE INTERNATIONAL SCENE The international marketplace has never been stronger, and the Internet is making that huge market more accessible to even the smallest enterprises. Companies with Web sites suddenly find prospects from halfway around the world can order their products as easily as a customer down the street. Businesses that have never dealt with any currency other than the U.S. dollar are finding they must contend with pounds and rubles and yen and euros, and for the first time they must consider the need for accounting software that supports foreign currency transactions and reporting. Such support is more difficult than it first appears. Only a handful of accounting packages process multiple currencies in compliance with FASB Statement FASB Statement A standard set by the Financial Accounting Standards Board regarding a financial accounting and reporting method. Essentially, FASB statements determine the acceptable accounting practices that Certified Public Accountants use in reporting no. 52, Foreign Currency Translation, Statements of Standard Accounting Practice 20 (the United Kingdom and Canadian Canadian (kənā`dēən), river, 906 mi (1,458 km) long, rising in NE New Mexico. and flowing E across N Texas and central Oklahoma into the Arkansas River in E Oklahoma. authoritative pronouncement), International Accounting Standard 21, The Effects of Changes in Foreign Exchange Rates (the IASC's authoritative pronouncement), or the European Community European Community: see European Union. European Community (EC) Organization formed in 1967 with the merger of the European Economic Community, European Coal and Steel Community, and European Atomic Energy Community. EC Directives 4, Annual Account of Certain Types of Companies, and 7, Council Directive on Consolidated Accounts. Exhibit 2, page 70, lists how the leading accounting software modules handle multiple currencies.
Exhibit 2: How Accounting Software Handles International Commerce
Foreign Foreign
Currency Currency
Supported Supported
FASB 52- in General in Accounts
Complaint Ledger Payable
For the low-end market
BusinessWorks for Windows
Windows 12.0 No No No
M.Y.O.B. Premier 1.0 No No No
Peachtree Complete
Accounting for Windows 6.0 No No No
QuickBooks Pro 6.0 No No No
For the middle market
ACCPAC for Windows
Series 4.0 Yes Yes Yes
Great Plains Dynamics 5.0 Yes Yes Yes
MAS 90 for Windows 3.X No No(*) No(*)
Navision Financials No No Yes
Peachtree 2000 4.0 No No No
Platinum for Windows 4.6 Yes Yes Yes
RealWorld Expertise.LAN 5.0 No Yes Yes
SBT Professional Series 5.0 No Yes Yes
Solomon IV for Windows 4.0x Yes Yes Yes
Traverse 8.3 No(*) No(*) Yes
Visual AccountMate 4.0 No(*) No(*) Yes
For the beginning ERP market
Acuity Applications 4.0 Yes Yes Yes
Great Plains Dynamics
C/S+ 5.0 Yes Yes Yes
Platinum ERA 4.2 Yes Yes Yes
RealWorld Expertise.SQL 5.0 Yes Yes Yes
SAP Accelerated
Financials R/3 Yes Yes Yes
SBT Executive Series 3.10 No Yes Yes
Solomon IV for
BackOffice 4.0x Yes Yes Yes
Foreign
Currency Foreign
Supported Currency
in Accounts Supported in
Receivable Inventory
For the low-end market
BusinessWorks for Windows
Windows 12.0 No No
M.Y.O.B. Premier 1.0 No No
Peachtree Complete
Accounting for Windows 6.0 No No
QuickBooks Pro 6.0 No No
For the middle market
ACCPAC for Windows
Series 4.0 Yes Yes
Great Plains Dynamics 5.0 Yes Yes
MAS 90 for Windows 3.X No(*) No(*)
Navision Financials Yes No
Peachtree 2000 4.0 No No
Platinum for Windows 4.6 Yes Yes
RealWorld Expertise.LAN 5.0 Yes Yes
SBT Professional Series 5.0 Yes Yes
Solomon IV for Windows 4.0x Yes Yes
Traverse 8.3 Yes No
Visual AccountMate 4.0 Yes No
For the beginning ERP market
Acuity Applications 4.0 Yes Yes
Great Plains Dynamics
C/S+ 5.0 Yes No(*)
Platinum ERA 4.2 Yes Yes
RealWorld Expertise.SQL 5.0 Yes Yes
SAP Accelerated
Financials R/3 Yes Yes
SBT Executive Series 3.10 Yes No(*)
Solomon IV for
BackOffice 4.0x Yes Yes
Supports
Euro- Foreign
Complaint Languages
For the low-end market
BusinessWorks for Windows
Windows 12.0 No No
M.Y.O.B. Premier 1.0 No No
Peachtree Complete
Accounting for Windows 6.0 No No
QuickBooks Pro 6.0 No No
For the middle market
ACCPAC for Windows
Series 4.0 Yes Yes
Great Plains Dynamics 5.0 Yes Yes
MAS 90 for Windows 3.X No No(*)
Navision Financials Yes Yes
Peachtree 2000 4.0 No No
Platinum for Windows 4.6 No Yes
RealWorld Expertise.LAN 5.0 No(*) No
SBT Professional Series 5.0 No No(*)
Solomon IV for Windows 4.0x Yes No(*)
Traverse 8.3 No Yes
Visual AccountMate 4.0 No Yes
For the beginning ERP market
Acuity Applications 4.0 No No(*)
Great Plains Dynamics
C/S+ 5.0 Yes Yes
Platinum ERA 4.2 Yes Yes
RealWorld Expertise.SQL 5.0 No No
SAP Accelerated
Financials R/3 Yes Yes
SBT Executive Series 3.10 No No
Solomon IV for
BackOffice 4.0x Yes No(*)
(*) Vendor reports this feature either is in the process of being added or can be achieved via third-party add-on applications or by modifying the source code. The accounting software packages with the strongest international features are currently produced by ACCPAC ACCPAC Accounts Package ACCPAC Accounting Package International, Epicor EpiCor is a product derived from fermented baker's yeast culture. It was discovered after insurance data on employees of an animal food factory showed reduced illness. The producers espouse it to have antioxidant properties due to a combination of trace elements found including Software, SAP, Great Plains and Solomon Solomon, d. c.930 B.C., king of the ancient Hebrews (c.970–c.930 B.C.), son and successor of David. His mother was Bath-sheba. His accession has been dated to c.970 B.C. According to the Bible. . Unfortunately, many other packages don't don't 1. Contraction of do not. 2. Nonstandard Contraction of does not. n. A statement of what should not be done: a list of the dos and don'ts. provide multiple currency support at all, don't support it fully or don't support it in all relevant modules. From a balance sheet reporting perspective, accounting for fluctuations in exchange rates became much easier in 1981 when FASB Statement no. 52 called for using the current exchange rate to compute To perform mathematical operations or general computer processing. For an explanation of "The 3 C's," or how the computer processes data, see computer. both the value of the assets (and liabilities) and the related accumulated depreciation accumulated depreciation The total amount of depreciation that has been recorded for an asset since its date of acquisition. For example, a computer with a 5-year estimated life that was purchased for $2,000 would have accumulated depreciation of $800 [( . However, other foreign currency computations can be more involved. For example, the value of inventory held in foreign warehouses must be restated each reporting period when fluctuating exchange rates result in the recognition of an unrealized gain Unrealized Gain A profit that results from holding on to an asset rather than cashing it in and using the funds. Notes: Let's say you own a stock that has doubled, but you haven't sold it yet. This is said to be an unrealized gain. or loss. Further, international sales transactions that take place often aren't aren't Contraction of are not. See Usage Note at ain't. aren't are not aren't be processed until several minutes (or several hours) later, resulting in a gain or loss due to fluctuating exchange rates. Those adjustments also must be considered when restating data in foreign currencies. To handle these complexities, Platinum's multiple-currency module provides a screen to input the daily exchange rate for each relevant foreign currency. In that way, users can toggle To alternate back and forth between two states. toggle - To change a bit from whatever state it is in to the other state; to change from 1 to 0 or from 0 to 1. This comes from "toggle switches", such as standard light switches, though the word "toggle" actually refers to between converting U.S. dollars to the foreign currency and converting the foreign currency back to dollars. Platinum for Windows can even deal with budgeted exchange rates, producing reports that show the effects of favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. and unfavorable exchange rate fluctuations. Some smaller international companies attempt to avoid the complexities of foreign currency translation by offering goods for sale only in their base currencies and by accepting only credit card payments from international customers. With this strategy, they account for all receivables Receivables An asset designation applicable to all debts, unsettled transactions or other monetary obligations owed to a company by its debtors or customers. Receivables are recorded by a company's accountants and reported on the balance sheet, and they and include all debts owed in U.S. dollars and the credit card company converts all revenue to U.S. dollars before receipt. While it may minimize the materiality MATERIALITY. That which is important; that which is not merely of form but of substance. 2. When a bill for discovery has been filed, for example, the defendant must answer every material fact which is charged in the bill, and the test in these cases seems to of fluctuating currencies, this strategy doesn't does·n't Contraction of does not. avoid the problem completely because transactions are seldom transacted and consummated con·sum·mate tr.v. con·sum·mat·ed, con·sum·mat·ing, con·sum·mates 1. a. To bring to completion or fruition; conclude: consummate a business transaction. b. simultaneously. Beginning this year, foreign currency requirements became even more complicated as the euro became the official currency of the European Union European Union (EU), name given since the ratification (Nov., 1993) of the Treaty of European Union, or Maastricht Treaty, to the European Community (EU). Some EU companies already were adjusting for the euro. However, by 2002, when the new euro coins and notes enter circulation, all EU businesses must use the euro as their local currency. Currently, 11 of the 15 EU member countries have fixed their currencies to the euro: Austria Austria (ô`strēə), Ger. Österreich [eastern march], officially Republic of Austria, federal republic (2005 est. pop. 8,185,000), 32,374 sq mi (83,849 sq km), central Europe. , Belgium Belgium (bĕl`jəm), Du. België, Fr. La Belgique, officially Kingdom of Belgium, constitutional kingdom (2005 est. pop. 10,364,000), 11,781 sq mi (30,513 sq km), NW Europe. , Finland Finland, Finnish Suomi (swô`mē), officially Republic of Finland, republic (2005 est. pop. 5,223,000), 130,119 sq mi (337,009 sq km), N Europe. , France, Germany Germany (jûr`mənē), Ger. Deutschland, officially Federal Republic of Germany, republic (2005 est. pop. 82,431,000), 137,699 sq mi (356,733 sq km). , Ireland Ireland, Irish Eire (âr`ə) [to it are related the poetic Erin and perhaps the Latin Hibernia], island, 32,598 sq mi (84,429 sq km), second largest of the British Isles. , Italy Italy (ĭt`əlē), Ital. Italia, officially Italian Republic, republic (2005 est. pop. 58,103,000), 116,303 sq mi (301,225 sq km), S Europe. , Luxembourg Luxembourg, province, Belgium Luxembourg, Du. Luxemburg, province (1991 pop. 232,813), 1,706 sq mi (4,419 sq km), SE Belgium, in the Ardennes, bordering on the Grand Duchy of Luxembourg in the east and on France in the south. , the Netherlands Netherlands (nĕth`ərləndz), Du. Nederland or Koninkrijk der Nederlanden, officially Kingdom of the Netherlands, constitutional monarchy (2005 est. pop. 16,407,000), 15,963 sq mi (41,344 sq km), NW Europe. , Portugal Portugal (pôr`chəgəl), officially Portuguese Republic, republic (2005 est. pop. 10,566,000), 35,553 sq mi (92,082 sq km), SW Europe, on the western side of the Iberian Peninsula and including the Madeira Islands and the Azores in the and Spain Spain, Span. España (āspä`nyä), officially Kingdom of Spain, constitutional monarchy (2005 est. pop. 40,341,000), 194,884 sq mi (504,750 sq km), including the Balearic and Canary islands, SW Europe. . The remaining 4--Britain, Denmark Denmark (dĕn`märk), Dan. Danmark, officially Kingdom of Denmark, kingdom (2005 est. pop. 5,432,000), 16,629 sq mi (43,069 sq km), N Europe. , Greece Greece, Gr. Hellas or Ellas, republic (2005 est. pop. 10,668,000), 50,944 sq mi (131,945 sq km), SE Europe. It occupies the southernmost part of the Balkan Peninsula and borders on the Ionian Sea in the west, on the Mediterranean Sea in the south, on and Sweden--plan to participate in the euro conversion. Therefore, if you plan to do business in Europe Europe (y  r`əp), 6th largest continent, c.4,000,000 sq mi (10,360,000 sq km) including adjacent islands (1992 est. pop. 512,000,000). , your accounting
software should be euro-compliant.EASE OF USE Another important feature to look for when evaluating accounting software is user-friendliness. Unfortunately, that feature is hard to quantify Quantify - A performance analysis tool from Pure Software. : What is user-friendly user-friendly - Programmer-hostile. Generally used by hackers in a critical tone, to describe systems that hold the user's hand so obsessively that they make it painful for the more experienced and knowledgeable to get any work done. to some is of no significance to others, which means the only way to measure ease of use is to have every user group test a candidate product's features--a task that may be unrealistic to perform. The basic areas to test are installation, setup See BIOS setup and install program. and training and the day-to-day day-to-day adj. 1. Occurring on a routine or daily basis: the day-to-day movements of the stock market. 2. operation. Here, using several products as examples, are some of the features that makes software easy to use: Graphic guidance. Peachtree Peachtree can be several things:
Graphical representation of a process, such as a manufacturing operation or a computer operation, indicating the various steps taken as the product moves along the production line or the problem moves through the computer. symbols (invoices, journals, general ledger General Ledger A company's accounting records. This formal ledger contains all the financial accounts and statements of a business. Notes: The ledger uses two columns: one records debits, the other has offsetting credits. ) that help a novice bookkeeper understand how data flow through the system. The text-only menu is designed for speed and for the more experienced user. The graphical menu provides much more help to the novice. The following example illustrates how it works and why it's important. Assume a novice bookkeeper assigned as·sign tr.v. as·signed, as·sign·ing, as·signs 1. To set apart for a particular purpose; designate: assigned a day for the inspection. 2. to conduct an inventory count discovers a discrepancy DISCREPANCY. A difference between one thing and another, between one writing and another; a variance. (q.v.) 2. Discrepancies are material and immaterial. : The inventory report shows 15 lamps on hand; the inventory count shows only 12. To make the appropriate adjustment, the bookkeeper clicks on the graphic menu labeled Inventory, which displays flowchart symbols depicting the flow of transaction entries through the inventory system. The pictures suggest that an inventory adjustment flows to an inventory adjustments report, which in turn flows to both the general ledger and the item card. The bookkeeper clicks on the flowchart symbol titled Adjustments and the appropriate adjusting journal entry screen pops up. The bookkeeper selects Lamps from the inventory lookup A data search performed within a predefined table of values (array, matrix, etc.) or within a data file. list to display the item information, including the quantity on hand of 15 lamps. The bookkeeper enters a "-3" in the adjustment box and clicks the Post and Close buttons. In recording that transaction, the bookkeeper didn't did·n't Contraction of did not. didn't did not didn't do have to know what to debit A monetary amount that is subtracted from an account balance. A debit from one account is a credit to another. See credit. or what to credit--the place where some bookkeepers run into trouble. When a novice bookkeeper has to decide to which accounts transactions should be posted, he or she is likely to make errors. Here, our novice bookkeeper might not have known whether to post the debit side Noun 1. debit side - account of payments owed; usually the left side of a financial statement accounting system, method of accounting, accounting - a bookkeeper's chronological list of related debits and credits of a business; forms part of a ledger of accounts of the entry to purchases, to cost of goods sold Cost of goods sold The total cost of buying raw materials, and paying for all the factors that go into producing finished goods. cost of goods sold or elsewhere. On many occasions, I've I've Contraction of I have. I've I have I've have found bookkeepers mistakenly mis·tak·en v. Past participle of mistake. adj. 1. Wrong or incorrect in opinion, understanding, or perception. 2. Based on error; wrong: a mistaken view of the situation. plugging into the other side of transactions to retained earnings Retained Earnings The percentage of net earnings not paid out in dividends, but retained by the company to be reinvested in its core business or to pay debt. It is recorded under shareholders equity on the balance sheet. . Such errors can go undetected for months or until yearend, when the accountant compiles or reviews the financial statements. Default-rich settings. Peachtree protects against errors such as the above because the product is default-rich--that is, the product allows users to establish default settings that address that problem. Here's how it solves the inventory problem: The novice bookkeeper can't determine the adjustment amount for the lamps. Assume the company currently purchases them for $60 each but had paid just $52 each for 12 lamps that are still on hand. Would the bookkeeper choose to adjust the books using the $52 price, the $60 price or the average price of $567 In this example, the correct answer is none of the above; the company values inventory using the weighted-average method so the correct adjusting entry would be $57.33 each (4 purchased at $52 and 8 purchased at $60). Peachtree solves this problem by allowing the default setting to specify the weighted-average method. Another example of default-rich settings can be found in Great Plains Dynamics. Setting up one inventory item in Dynamics requires the user to specify 15 different account numbers for each item entered. Even seasoned installers find this a formidable task. However, once the defaults are established, all future posting operations are easy, automatic and essentially error free. Look and feel. Then there's the look-and-feel factor--that is, how do the screens look to the user and how does the overall operation of the software feel? Is it hard to use the software? Are the screen labels and instructions confusing con·fuse v. con·fused, con·fus·ing, con·fus·es v.tr. 1. a. To cause to be unable to think with clarity or act with intelligence or understanding; throw off. b. and complicated? Are the processes intuitive? Are the menus clear? ACCPAC for Windows has a screen appearance that is easy for anybody to relate to: The screens look like a spiral spiral /spi·ral/ (spi´ral) 1. helical; winding like the thread of a screw. 2. helix; a winding structure. notebook complete with user tabs. This may appear a bit cute cute adj. cut·er, cut·est 1. Delightfully pretty or dainty. 2. Obviously contrived to charm; precious: "[He] , but the concept works very well for many users who find they are better able to understand the user screens, require less training time and are more comfortable with the software. ACCPAC solves a problem faced by the entire accounting software industry: the efficient use of screen real estate. Ask yourself, How many screens would you prefer to input a single vendor invoice An itemized statement or written account of goods sent to a purchaser or consignee by a vendor that indicates the quantity and price of each piece of merchandise shipped. A consular invoice is one used in foreign trade. ? Most people wish it was just one. Unfortunately, most of today's accounting software packages have so many features that it usually takes three or four screens just to accommodate all data input options for a single vendor invoice. Some accounting software vendors attempt to solve this problem by squeezing more data fields onto each user input screen. They may succeed in reducing the total number of screens, but those screens are so crowded they can be intimidating in·tim·i·date tr.v. in·tim·i·dat·ed, in·tim·i·dat·ing, in·tim·i·dates 1. To make timid; fill with fear. 2. To coerce or inhibit by or as if by threats. . ACCPAC's design provides the illusion Illusion See also Appearances, Deceiving. Barmecide feast imaginary feast served t0 beggar by prince. [Arab. Lit.: Arabian Nights, “The Barmecide’s Feast”] Emperor’s New Clothes of one data input screen when, in fact, there are eight. Because of the notebook look coupled with the bottom tabs, the user doesn't feel lost or buried bur·y tr.v. bur·ied, bur·y·ing, bur·ies 1. To place in the ground: bury a bone. 2. a. To place (a corpse) in a grave, a tomb, or the sea; inter. b. in the accounting package. THE Y2K BUG Most of the accounting software packages written in the past used a two-digit field to refer to the four-digit year, omitting the first two digits that referred to the century--the Y2K bug. Such software interprets a 00 entry to be the year 1900 instead of the year 2000. With the widespread publicity about this problem over the past decade, you might expect accounting software vendors would have solved this problem long ago. The reason they didn't is because they found it easier to model new source codes based on the same flawed flaw 1 n. 1. An imperfection, often concealed, that impairs soundness: a flaw in the crystal that caused it to shatter. See Synonyms at blemish. 2. date syntax syntax: see grammar. syntax Arrangement of words in sentences, clauses, and phrases, and the study of the formation of sentences and the relationship of their component parts. of the older code for the sake of backward compatibility See backward compatible. (jargon) backward compatibility - Able to share data or commands with older versions of itself, or sometimes other older systems, particularly systems it intends to supplant. . Only recently did many accounting software vendors solve this problem. Others report that a fix effort is still under way. It's possible some vendors won't complete the fix by yearend, so buyers should check before buying. Some vendors have made their products Y2K-compliant while others have made them Y2K-compatible. The difference is important. Y2K-compliant means the vendor rewrote the software to use a four-digit year--totally eliminating the problem. Y2K-compatible means the software uses an algorithm algorithm (ăl`gərĭth'əm) or algorism (–rĭz'əm) [for Al-Khowarizmi], a clearly defined procedure for obtaining the solution to a general type of problem, often numerical. to get around the problem. Exhibit 3, at right, lists how the leading accounting software vendors have addressed the Y2K problem Y2K problem or Y2K bug: see Year 2000 problem. (Year 2000 problem) The inability of older hardware and software to recognize the century change in a date. .
Exhibit 3: How accounting Software Addresses the Y2K Bug
Y2K-Complaint(*)
For the low-end market
BusinessWorks for Windows 12.0 Yes
M.Y.O.B. Premier 1.0 Yes
Peachtree Complete Accounting for Windows 6.0 Yes
QuickBooks Pro 99 No
For the middle market
ACCPAC for Windows Series 4.0 Yes
Great Plains Dynamics 5.0 Yes
MAS 90 for Windows 3.X Yes
Navision Financials Yes
Peachtree 2000 4.0 Yes
Platinum for Windows 4.6 Yes
RealWorld Expertise.LAN 5.0 Yes
SBT Professional Series 5.0 Yes
Solomon IV for Windows 4.0x Yes
Traverse 8.3 Yes
Visual AccountMate 4.0 Yes
For the beginning ERP market
Acuity Applications 4.0 Yes
Great Plains Dynamics C/S+ 5.0 Yes
Platinum ERA 4.2 Yes
RealWorld Expertise.SQL 5.0 Yes
SAP Accelerated Financials R/3 Yes
SBT Executive Series 3.10 Yes
Solomon IV for BackOffice 4.0x Yes
Y2K-Compatible(*)
For the low-end market
BusinessWorks for Windows 12.0 No
M.Y.O.B. Premier 1.0 No
Peachtree Complete Accounting for Windows 6.0 No
QuickBooks Pro 99 Yes
For the middle market
ACCPAC for Windows Series 4.0 No
Great Plains Dynamics 5.0 No
MAS 90 for Windows 3.X No
Navision Financials No
Peachtree 2000 4.0 Yes
Platinum for Windows 4.6 No
RealWorld Expertise.LAN 5.0 No
SBT Professional Series 5.0 No
Solomon IV for Windows 4.0x Yes
Traverse 8.3 Yes
Visual AccountMate 4.0 No
For the beginning ERP market
Acuity Applications 4.0 No
Great Plains Dynamics C/S+ 5.0 No
Platinum ERA 4.2 No
RealWorld Expertise.SQL 5.0 No
SAP Accelerated Financials R/3 Yes
SBT Executive Series 3.10 No
Solomon IV for BackOffice 4.0x Yes
(*) Y2K-compliant means the software uses a four-digit year. Y2K-compatible means the software uses some kind of algorithm--for example, adding 1900 to any two-digit year higher or equal to 28 and adding 2000 to any two-digit year less than 28. A programming routine expected to trigger Y2K problems is the validation See validate. validation - The stage in the software life-cycle at the end of the development process where software is evaluated to ensure that it complies with the requirements. check. Many programmers This is a list of programmers notable for their contributions to software, either as original author or architect, or for later additions. See also: Game programmer, List of computer scientists routinely built in procedures to test data as they are entered into the system. For example, when the user inputs the year 84, the system tests to be sure the value falls between 00 and 99--the validation range. If the value falls properly within that range, the data are accepted; otherwise, they are rejected. Because some programs test for "greater than 00" or "less than 99," this validation may improperly im·prop·er adj. 1. Not suited to circumstances or needs; unsuitable: improper shoes for a hike; improper medical treatment. 2. reject amounts entered either as 1999 or 2000. In many cases, programmers avoided this problem entirely simply by using the "greater than or equal to" and "less than or equal to" expressions. It's important to note that even if your accounting software package is Y2K-compliant, your computer may not be. The accounting software picks up the date from the operating system operating system (OS) Software that controls the operation of a computer, directs the input and output of data, keeps track of files, and controls the processing of computer programs. , and the operating system picks up the date from the computer's ROM BIOS--a basic program permanently stored in a chip. Many of those chips will not be able to tell the computer the correct date on January 1, 2000. Half the PCs shipped in June 1997 reportedly contain such a flawed chip, while PCs purchased before then have a 70% to 90% chance of having it. The extent of the Y2K problem varies from PC brand to brand. In some cases, although your computer may fail to properly calculate the new date on January 1, the problem can be corrected permanently simply by inputting the correct date. In other cases, your PC may require that you input the correct date each time you boot up. In extreme cases, your PC may not accommodate 2000 at all and replacement of the ROM BIOS (ROM Basic Input Output System) The BIOS in a PC stored on a ROM chip. Early PCs used a ROM BIOS, but PCs today use a flash memory BIOS because it can be updated in place. chip--or the entire computer--will be your only solution. During the past year, Microsoft has identified, and in most cases corrected, minor Y2K problems in Windows 95, 98 and NT; it publishes a list of all the known problems in its product line at www.microsoft.com/year2000. To help you determine the extent of Y2K problems in your PC, search the Internet for utilities available for download To receive a file transmitted over a network. In any communications session, "download" means receive, and "upload" means send. The download/upload often implies a big/little scenario, in which data is being downloaded from the "big" server into the "little" user's computer. ; when you run those utilities, you will learn what steps you need to take to ensure your computer will provide the correct date at the turn of the year. Even if your company's computer systems are completely Y2K-compliant, you still may fall victim to this bug. Every business depends on data from an intricate network of suppliers, distributors and consumers; Y2K problems may adversely affect any or every one of these organizations. As you evaluate and select an accounting software package, make Y2K See Y2K problem and Y2K compliant. Y2K - Year 2000 compliance a leading consideration. Another anticipated date problem relates to date confusion. To illustrate, in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. , the entry 3/4/2000 is commonly interpreted as March 4, 2000. However, outside the United States, this same date often is interpreted as April 3, 2000. Because no international standard has yet emerged, the potential exists for serious errors. ACCOUNTING SOFTWARE COST The cost of a new accounting system has three primary components--software, hardware and consultant fees. It's important to understand how they affect the total cost of a system. * Software costs. As shown in exhibit 4, page 77, the cost of accounting software varies widely and climbs quickly as the number of concurrent users In computer science, the number of concurrent users for a resource in a location, with the location being a computing network or a single computer, refers to the total number of people using the resource at the same time. increases. Companies purchasing low-end products can expect to pay from $149 to almost $5,300 for the product. Companies purchasing middle-market products can pay from $2,000 to more than $200,000. Companies purchasing beginning ERP (Enterprise Resource Planning) An integrated information system that serves all departments within an enterprise. Evolving out of the manufacturing industry, ERP implies the use of packaged software rather than proprietary software written by or for one customer. market software can expect to pay between $22,500 and $450,000.
Exhibit 4: Sample Pricing for Eight Core Modules(*)
Single User 5 Users
For the low-end market
(companies with revenues up to $5 million
BusinessWorks for Windows 12.0 $3,760 $4,550
M.Y.O.B. Premier 1.0 $449 $647
Peachtree Complete Accounting for
Windows 6.0 $149 $149
QuickBooks Pro 6.0 $149 $500
For the middle market
(companies with revenues from $2 million to $50 million)
ACCPAC for Windows Series 4.0 $7,800 $7,800
Great Plains Dynamics 5.0 $3,500 $11,000
MAS 90 for Windows 3.X $4,400 $13,900
MAS 90 Client/Server for Windows NT $4,400 $17,900
Navision Financials 3.0 $10,100 $16,500
Peachtree 2000 4.0 $1,999 $2,998
Platinum for Windows 4.7 $13,160 $18,655
RealWorld Expertise.LAN 5.0(*) $3,855 $6,375
SBT Professional Series 5.0 $9,600 $9,600
Solomon IV for Windows 4.0x $8,700 $9,450
Traverse 8.3 $4,000 $9,120
Visual AccountMate 4.0 $9,460 $9,460
For the beginning ERP market
(Companies with revenues from $25 million to $250 million)
Acuity Applications 4.0 N/A $43,500
Great Plains Dynamics C/S+ 5.0 N/A N/A
Platinum ERA 4.2 N/A $85,000
RealWorld Expertise.SQL 5.0 N/A $31,750
SAP Accelerated Financials R/3
(pricing includes all modules) N/A $22,500
SBT Executive Series 3.10 N/A $48,000
Solomon IV for BackOffice 4.0x N/A $22,717
10 Users 25 Users
For the low-end market
(companies with revenues up to $5 million
BusinessWorks for Windows 12.0 $4,755 $5,255
M.Y.O.B. Premier 1.0 $1,142 N/A
Peachtree Complete Accounting for
Windows 6.0 $149 $149
QuickBooks Pro 6.0 N/A N/A
For the middle market
(companies with revenues from $2 million to $50 million)
ACCPAC for Windows Series 4.0 $17,550 $28,800
Great Plains Dynamics 5.0 $15,500 $28,500
MAS 90 for Windows 3.X $15,400 $19,900
MAS 90 Client/Server for Windows NT $21,900 $33,900
Navision Financials 3.0 $20,100 $29,700
Peachtree 2000 4.0 $3,499 $3,499
Platinum for Windows 4.7 $28,645 $41,120
RealWorld Expertise.LAN 5.0(*) $6,875 $21,235
SBT Professional Series 5.0 $11,100 $15,600
Solomon IV for Windows 4.0x N/A N/A
Traverse 8.3 $11,120 $34,960
Visual AccountMate 4.0 $9,460 $18,960
For the beginning ERP market
(Companies with revenues from $25 million to $250 million)
Acuity Applications 4.0 $83,500 $113,500
Great Plains Dynamics C/S+ 5.0 $79,500 $117,000
Platinum ERA 4.2 $94,500 $120,000
RealWorld Expertise.SQL 5.0 $35,500 $46,750
SAP Accelerated Financials R/3
(pricing includes all modules) $45,000 $112,500
SBT Executive Series 3.10 $53,000 $68,000
Solomon IV for BackOffice 4.0x $33,383 $58,983
100 Users
For the low-end market
(companies with revenues up to $5 million
BusinessWorks for Windows 12.0 N/A
M.Y.O.B. Premier 1.0 N/A
Peachtree Complete Accounting for
Windows 6.0 N/A
QuickBooks Pro 6.0 N/A
For the middle market
(companies with revenues from $2 million to $50 million)
ACCPAC for Windows Series 4.0 $176,500
Great Plains Dynamics 5.0 $94,000
MAS 90 for Windows 3.X N/A
MAS 90 Client/Server for Windows NT $87,900
Navision Financials 3.0 $75,300
Peachtree 2000 4.0 N/A
Platinum for Windows 4.7 $101,000
RealWorld Expertise.LAN 5.0(*) $58,660
SBT Professional Series 5.0 $38,100
Solomon IV for Windows 4.0x N/A
Traverse 8.3 $118,680
Visual AccountMate 4.0 $37,960
For the beginning ERP market
(Companies with revenues from $25 million to $250 million)
Acuity Applications 4.0 $233,500
Great Plains Dynamics C/S+ 5.0 $304,500
Platinum ERA 4.2 $225,000
RealWorld Expertise.SQL 5.0 $103,000
SAP Accelerated Financials R/3
(pricing includes all modules) $450,000
SBT Executive Series 3.10 $143,000
Solomon IV for BackOffice 4.0x $218,983
(*) Includes general ledger, accounts receivable accounts receivable n. the amounts of money due or owed to a business or professional by customers or clients. Generally, accounts receivable refers to the total amount due and is considered in calculating the value of a business or the business' problems in paying , accounts payable, payroll, inventory, order entry, job cost and system manager. * Hardware costs. When purchasing a new accounting software package, it's usually best-for a variety of reasons--to buy new hardware as well. First, if you are in the market for new software, chances are your hardware already is fairly old. In fact, it's wise to replace hardware at least every three years as the warranty expires. Another reason to upgrade hardware is because operating systems Operating systems can be categorized by technology, ownership, licensing, working state, usage, and by many other characteristics. In practice, many of these groupings may overlap. and technologies change frequently. Yesterday's equipment was not designed to run today's latest operating systems and applications. In fact, keeping old equipment is often more costly than just replacing it, especially after you consider how much you pay for system upgrades and a consultant's time tweaking tweaking Vox populi Fine-tuning to produce optimal results the systems to work properly. Keep in mind that hardware is the cheapest component of a new system. Finally, hardware keeps getting faster. The time savings alone typically pays back the hardware cost in a matter of months. Over time, it gets expensive if an employee has to wait while an application launches, for screens to refresh (1) To continuously charge a device that cannot hold its content. CRTs must be refreshed, because the phosphors hold their glow for only a few milliseconds. Dynamic RAM chips require refreshing to maintain their charged bit patterns. See vertical scan frequency and redraw. , for data to post and for reports to print. Newer, faster hardware that crashes less frequently and causes fewer problems always results in time--and money--savings. * Consulting fees. In many cases, consulting fees account for the lion's share of the cost of implementing a new accounting system. Here's why that is. For starters, the term installation engagement is misleading. The actual time spent installing the software is minimal--less than 5% of the engagement. The vast amount of time spent "implementing" a new accounting system actually is spent training employees to assemble the various accounting data, to enter that data and to close out each period and produce the month-end reports. For this reason, it's far more accurate to describe them as training engagements. When installing a low-end accounting system, the seasoned consultant typically spends 40 to 60 hours on the job, most of the time training the client's staff. On the other hand, the assignment might take as long as 100 hours or more if the staff is weak in bookkeeping bookkeeping, maintenance of systematic and convenient records of money transactions in order to show the condition of a business enterprise. The essential purpose of bookkeeping is to reveal the amounts and sources of the losses and profits for any given period. skills. Assuming an average billing rate of between $75 and $150 per hour, you could pay a consultant anywhere from $3,000 to $9,000 to get the job done. For larger accounting systems, the task at hand really remains the same, except the volume of data to be assembled as·sem·ble v. as·sem·bled, as·sem·bling, as·sem·bles v.tr. 1. To bring or call together into a group or whole: assembled the jury. 2. is larger and there are more people to train and more modules to be installed. In the middle market, consultants usually charge fees equivalent to the cost of the software. For example, a customer paying $9,500 for a 10-user version of Visual AccountMate can pay an additional $9,500 in consulting fees. Many seasoned consultants in larger cities charge fees at the rate of twice the cost of the software. At that level, fees can run from $8,000 to $50,000 and up. In the beginning ERP market, the 1:1 ratio still applies, with typical fees for installing higher end Coordinates: For other places with the same name, see Billinge. Higher End or Billinge Higher End is a district of the Metropolitan Borough of Wigan, in Greater Manchester, England. systems ranging from a minimum of $50,000 to $200,000 or more. These fees are dramatically higher due to the complexity of implementing the client/server technology and the advanced databases, tweaking the server operating systems See network operating system. and working out conflicts with other applications and printers. At this level, added inefficiencies relate to deploying systems in multiple locations and to tying those systems together. The consultant also must spend a lot of time granting user rights to appropriate servers, drives and folders and implementing the proper security measures Noun 1. security measures - measures taken as a precaution against theft or espionage or sabotage etc.; "military security has been stepped up since the recent uprising" security to prevent unauthorized access to data. FINDING HELP To aid in your search for the best software for your organization, check out the following resources: * My Web page (www.AccountingSoftwareNews. com) contains current information and opinions about the top accounting software products. * The Accounting Library (804-330-0000) is a computerized computerized adapted for analysis, storage and retrieval on a computer. computerized axial tomography see computed tomography. buyer's guide that contains an up-to-date list of accounting software features for more than 115 packages. Simply check what you need from a list of 1,750 features and the Accounting Library produces reports summarizing the products that best meet your needs. You also can produce a report summarizing the missing features in each accounting software package. Updated three times a year, it's the most comprehensive product on the market and sells for $395. A client/server version, available for $995, profiles the high-end, enterprise-level accounting software packages. * The Requirements Analyst (301-468-4800), published by Computer Training Services, Inc., is a loose-leaf book that covers approximately 20 products. It costs $595. * Software Compare, a software program from Practitioners Publishing Co. (800-323-8724), reviews 90 packages and sells for $300. * Local CPAs who sell and install accounting software packages. You usually can locate the top CPA (Computer Press Association, Landing, NJ) An earlier membership organization founded in 1983 that promoted excellence in computer journalism. Its annual awards honored outstanding examples in print, broadcast and electronic media. The CPA disbanded in 2000. dealers and installers in your area by calling your state CPA society. * Accounting software vendors' Web sites, which have up-to-date product information. In addition, you can ask vendors to send you evaluation copies of packages on CD. This allows you to install the product and give it a test drive. Finding the right accounting software is a time-consuming, tedious job. If you do it correctly and follow the guides in this article, the payoff will be well worth the investment in time.
How to Contact the Vendors
Products Vendor Contacts
ACCPAC for Windows ACCPAC International
Craig Downing
925-461-6716
www.accpac.com
Acuity Applications State of the Art
MAS 90 for Windows Taylor MacDonald
BusinessWorks for Windows 770-804-5845
www.sota.com
Crystal Reports Seagate Software
Phil Walston
800-877-2340
www.crystalreports.com
Forest & Trees Platinum Technologies
John Ulery
603-430-6587
www.platinum.com
FRx FRx Software
Robert Rohan
303-741-8000
www.frxsoft.com
Great Plains Dynamics Great Plains Software
Great Plains Dynamics C/S+ Pamela Kram
281-265-1662
www.greatplains.com
Navision Financials Navision Software--US
Geni Whitehouse
770-798-8386
www.navision-us.com
Peachtree Complete Accounting Peachtree Software
for Windows Cynthia Williams
770-564-5700
www.peachtree.com
Platinum for Windows Epicor Software
Platinum ERA Tami Eshelman
800-999-1809
www.epicor.com
QuickBooks Pro 99 Intuit
Richard Walker
619-453-4446
www.quickbooks.com
RealWorld Expertise.LAN RealWorld Software
RealWorld Expertise.SQL Christine Gilroy
800-678-6336
www.realworld.com
SAP R/3 SAP Software
Ken Bernstein
973-331-6000
www.sap.com
SBT ProSeries SBT Corp.
SBT Executive Series Brian Austin
415-444-9900
www.sbtcorp.com
Solomon IV for Windows Solomon Software
Solomon IV for BackOffice Cindy Bechtel
419-424-0422, ext. 485
www.solomon.com
Traverse Open Systems Accounting Software
Amy Reynolds
612-403-5726
www.osas.com
Accounting Software Series on the Web This entire series of articles on accounting software appears on the AICPA AICPA See American Institute of Certified Public Accountants (AICPA). Web page at www.aicpa.org/pubs/jofa/index.htm.3 |
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