In the world of enterprise solutions, accounting software provides one of the most visible impacts to an organization. Employees ranging from executives to front-line employees rely heavily on the data and reports provided by an accounting and financial solution. Most accounting packages are able to provide basic chart of account and period-end close processes, along with standard reports to help run your business.
However, not all accounting software is created equally. Just as with other modules and functions of ERP, some solutions handle accounting better than others. Below are five things to look for when evaluating potential accounting software:
Considerations for Evaluating Accounting Software Packages
- Reporting and executive dashboards. Most companies have fairly unique reporting needs. Executives and employees may need to view profit and loss by product lines, work in progress, or other variations. In addition, different users have different needs for transparency into the internal day-to-day workings of the company. These needs should be clearly defined and compared to the functionality of your potential accounting solutions.
- Job and product costing. This can be one of the trickier aspects of reporting out of an enterprise accounting solution. Therefore it is important to closely examine the ability to gather this information from
- Budgeting and forecasting. This may be one of the more challenging aspects of accounting software. Rather than manually forecasting in Microsoft Excel and loading into your ERP or accounting system, more robust packages will provide tools to develop budgets and forecasts based on historical trends, seasonality, and other more sophisticated statistical models. Strong functionality in this area can pay huge dividends in increased efficiencies and more accurate planning.
- Integration with operations. Standalone accounting packages can be very powerful on their own, but they are even more powerful when they integrate into the core operations of your business. Drilling down from income statements to specific customer orders, for example, provides a great deal of visibility to employees. In addition, accounting data is even more useful when it incorporates real-time data around inventory levels, production orders, and other critical business data.
- Internal business controls. Accounting is more than just reporting results – it is also about providing internal controls. Even if your organization is not required to be Sarbanes-Oxley compliant, your accounting system’s automated workflows, approvals, and transaction security will ensure that you are minimizing your business risk and making your auditors happy.
There are countless other areas that need to be explored as part of an effective evaluation of accounting software options. However, the five areas listed here should provide a good starting point of where to focus.