As we roll into the new financial year, next year's tax time can be made a lot easier with the right accounting software. But deciding which option is best is not easy, explains Daniel James.
A couple of months ago BIT published this article looking at accounting software, including explanations of how it can help and reviews of some of the major software.
Unusually for a comparative review we did not attempt to identify the 'best' product - that's because after talking to accounting and bookkeeping professionals we realised that businesses have varying requirements, and an accounting program that's good for one business might not suit another. If it lacks a feature that's essential for a particular business, it is practically useless in that context. It's also easy to waste money on a high-end edition of a particular program if a simpler edition would have done the job adequately.
But despite not "rating" the products, we did observe that "We found good and not so good points about every single one of [the products]. As we approached the end of this project we found ourselves wishing someone would learn from the mistakes made by other developers and produce a really good and comprehensive small business accounting system without the shortcomings and irritations we encountered while examining these seven products."
As far as we could see, none of the products we tested stood out from the pack, even in the limited context of our imagined photography business. So we can see how difficult it would be for a small business person to make a rational choice between the specific products (say Moneyworks Express or MYOB AccountRight Basics, let alone between the Moneyworks and MYOB families) that do provide the required features.
And that, we suspect, gives accountants and bookkeepers a lot of influence over the software that their clients end up using. That was reflected in one of the comments on the original article, which read in part, "Also you need to ask your tax accountant what they are happy with and will they work with what you have chosen. (and also ask if you are prepared to move accountants)".
It would be one thing for a firm to say to its potential clients "We have developed significant experience with accounting program X, and if you use it we will be able to provide you with the best service in the smallest number of billable hours. But we've looked at your business, and edition Y will do the job for you."
But as some of the professionals we interviewed for the article told us, there are commercial arrangements between accounting software companies and accounting and bookkeeping firms, which might sometimes lead to a product being "recommended when it hasn’t necessarily been the best choice for that particular business."
We would be annoyed to find out that we were subjected to a more awkward and time-consuming task every time we issued an invoice or received a payment just to boost our accountant's income or to maintain their status in an affiliate program.
Before we are accused of tarring all the apples with the same brush (yes, a deliberately mangled metaphor!), we are prepared to believe that most accountants and bookkeepers do work in their clients' interests. But the fact that two of the professionals we interviewed suggested this is not always the case should give pause for thought.
Our message? Get good advice. A good bookeeper or accountant (like those we spoke to) will help you understand which product is right for you. We highly recommend getting advice from professionals like these to guide you in the right direction and make sure you're making the most of the technology. Just make sure your bookkeeper is open to all the options, even if it means sending you to someone else if they don't deal with the product you need to use.