Choosing an accounting system can be a very challenging task. There are many considerations, and likewise nearly endless choices. Does your business require a simple over the counter solution? Does your business need a more customized or specialized system? Maybe your business doesn’t even need a specific accounting system and can function in standard spreadsheet software such as Microsoft Excel? Regardless of the scenario, the decision should not be made with haste.
Although every situation is unique, here are some common considerations that should be taken when assessing any accounting software or system:
- Accuracy and Relevance of information - Likely the most important consideration is whether the system is capable of producing the reports and information that you require in your business. Can the system run financial reports? Can the system create invoices? Depending on your business, you may need the system to produce a number of reports or documents, it is important to take the time upfront to think about the requirements and ensure that the system is capable of producing the appropriate information.
- Implementation time and training - How sophisticated is the system, will it require significant training for yourself or your staff?
- Converting from old systems processes and procedures - Do you have a current system in place? If so, how difficult will it be to convert your old process and procedures as well as historical data into the new system? Is there any chance for automation?
- Number of users and access to the system - Do you require multiple users or staff members to use the system at once? If so, can the system handle the number of users that you will require? Furthermore, does the system integrate with external users such as the CRA or external auditors?
- Access and Security - Is there appropriate security in place to restrict and monitor the access to the information in the system? Does your business hold confidential information that would require additional security?
- Support and Maintenance - The last thing you want to do is be caught with a system that you cannot support or maintain. Is there support available? What is the cost? Are there regular updates? Does the system update information such as tax rates, etc.?
- Additional Modules - Will you require additional modules such as an inventory management, fixed assets, payroll? If so are these included in the system or are they additional costs?
- Integration with any existing systems - Perhaps you already have existing systems in place for your business. Does the proposed system have the capabilities to integrate with your current systems? For instance, if you already have a point of sale system in place, is there an opportunity for automation between the two systems.
- Price - Last but not least, it is important to consider the price of the system. Not only the upfront costs, but also additional costs down the road. Are there monthly fees? Have we considered the costs of maintaining and upgrading the system? Are there hardware requirements that we’ll need?
It is very important to spend sufficient time considering the factors upfront in setting up any new information system, and accounting is no different. Without an appropriate system in place maintaining and accessing information can become extremely inefficient. It is often an excellent opportunity to consult an expert.