Tag: small business

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Business Owners to Accountants – Tell Me in Real Time

Business Owners to Accountants – Tell Me in Real Time

Business accounting is defined as the system of recording and summarizing business and financial transactions and analyzing, verifying, and reporting the results.  It sounds pretty dull, and to most small business owners it is the last thing they want to think about.  “Accounting” is what happens at the end of the month, quarter or year – or when any type of taxes are due.  What matters to the small business owner is their cash flow and cash availability to meet immediate operational demands, and how they will get past today’s problems to reach their future goal of comfortable retirement, leaving a legacy for the kids, or selling the business at a high value.  It may even be that, during periodic visits to deliver the monthly paperwork to the accountant, business owners express interest in discussing their ability to meet future business goals, yet these conversations often take a back-burner to simply getting the work processed and reports and returns completed.

Accounting has traditionally been approached as an after-the-fact activity, recording transactions for things that were already done in the business.  While this may be a handy approach to getting an annual tax return completed, it really does nothing for the small business owner in terms of providing them with information to run the business. Further, it does nothing toward helping the business owner get to where they want to go with the business, reaching whatever goals they had in mind when they first got started.

Cloud solutions and Internet-based applications have emerged which provide a high level of capability and information to small business owners, much like the E*Trade tools which enabled any user to “take control of their financial futures by providing the products, tools and services they need to meet their near- and long-term investing goals”.  Where E*Trade delivered simplicity, insight, and guidance for investors in real-time, so do many of the new business analysis and financial dashboard solutions, but in a business financial context.

Individuals who are focused on meeting their financial or investment goals are very interested in monitoring their progress toward reaching those goals, and guidance often suggests that making adjustments in strategy or approach at certain points along the way may be required.  Similarly, business owners have a great interest in monitoring the progress and status of their businesses, and many are taking steps to gain that insight and obtain guidance through the use of online banking solutions and other real-time reporting tools.

By simply connecting financial systems to some of these online reporting tools, business owners are able to gain a significant level of insight into their business operations, including bank balances, cash coming in and going out, and other information which supports making daily business decisions.  Unlike a static financial statement or annual report, these dynamic tools can provide business owners with real-time information about their businesses, which is what the business owner is looking for.  But guess what?  It’s not happening like it ought to.

Business owners are becoming increasingly impatient with their accounting professionals, and are demanding higher levels of service at more competitive rates than ever.  Further, many business clients of accounting professionals are gaining a belief that the value their accountant delivers is diminishing as do-it-yourself tools are gaining in popularity due to ease of use and well-stated value propositions.  If accounting professionals would only take a proactive, rather than a reactive, approach to working with their clients, this question of value would be much less of a question.

The biggest problem facing these accounting professionals is that they rely upon the client to deliver the work.  Waiting around for clients to bring in information for processing, or traveling around to client offices to pick up materials when they say it’s ready, is creating a divide between the client and the accountant which is difficult to overcome.  This divide – the lag in time between when business things happen and when they are accounted for – eliminates any possibility for the business owner to operate with all the information they need.

Accounting professionals must become proactive in their relationships with business clients, establishing the initial groundwork for how each will perform in order to achieve the desired result – real-time information for real time decision support.  The accountant has a responsibility to not only ensure that the information is processed appropriately and accurately, but also to ensure that it is obtained and processed in a regular, timely manner.  Increasing the frequency of capturing and processing data is necessary in order to provide information when it is most useful.  This means that accountants must not only organize their workflows to adjust to the new frequency and timeframe for processing, but that they must also be far more proactive in obtaining the source information from clients on a regular and recurring basis.

It has always been a problem to get information from client businesses so that it can be processed and reported on.  Now, with the demand for more timely data and “instant insight”, business owners are expecting faster returns on the processing of accounting information even as they continue to be the bottleneck in providing the source data.  Accounting professionals and the tools they use will have to adjust to this reality, creating a stronger focus on the organization of work and turning notification and exception handling processes around so that they drive the workflow rather than simply result from it.

Make Sense?

J

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Being Proactive, Not Reactive – Accountants Need to Increase the Speed of Service Delivery

Being Proactive, Not Reactive – Accountants Need to Increase the Speed of Service Delivery

infoTechnology models are changing dramatically, with cloud services and mobile computing being the focus of the IT community and the customers they serve, and those technology changes are driving equally dramatic changes in how businesses and the accounting professionals who support them work together.

As the cloud enables an “anytime, anywhere” model for access to business applications and information, it is also driving accounting professionals to embrace those solutions in order to meet the demands of the business client  who wants their information anytime, anywhere… accurate and up-to-date.  For most accounting professionals, this means being more proactive in working with the client rather than taking the traditionally reactive, after-the-fact approach to providing service.  More frequently, accounting professionals will be judged by their prospective (and current) clients as to their ability to meet the demands of these savvy clients who know that having accurate real time information is critical to managing a business.

Cash management is one of the biggest challenges for a business owner, and this is an area where the accountant or bookkeeper is an essential player, making sure that bank accounts are reconciled frequently and reporting accurately on outstanding receivables and payables.  Business owners need to know where they stand financially, yet many accounting professionals only provide reconciliation and reporting at period ends.  The result is often a client who watches the bank balance and works from that, not realizing that there were outstanding checks or undeposited funds waiting to clear.  Clearly, this owner is not working from current and accurate information, and they will eventually realize it if they haven’t already.

The cloud is increasing the speed of business at all levels, and accounting professionals must also increase their speed of service delivery in order to retain relevance in the changing market.  While there will be hold-outs and businesses that elect to take the more traditional approaches, those clients will start to become fewer and the opportunities they represent more limited in scope.

For a little while, accounting professionals may rely upon traditional approaches to client service delivery, and continue with their position as the last person to know what’s going on in the client business.  But only for a little while.

Make Sense?

J

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Surprise! Consumer apps get IT approval in small businesses: GIGAOM.com

Surprise! Consumer apps get IT approval in small businesses: GIGAOM.com

In a recent article on GigaOm, author Barb Darrow discusses the findings of a survey of small businesses in the US, UK, Canada, Australia and New Zealand, where it was found that the use of “consumer” information technology is being more widely accepted for use in small businesses, and that many of these selections are happening without the knowledge or participation of the IT department.

“Employees are driving business apps selection in many small and medium businesses, according to new research. A good percentage of productivity, social and collaborative apps now sanctioned by IT in SMBs were brought in by workers without IT knowledge.“

Reporting that small businesses are adopting “consumer” IT, and that it is OK with IT departments, isn’t a surprising finding.  Small businesses have begun leveraging mobility and cloud solutions to their benefit, being able to take advantage of powerful technologies that previously only enterprise IT departments could enjoy.

 “.. the line between personal and workplace technologies has become all but invisible. That poses real challenges to IT departments that have to deal with all sorts of technology coming in over the transom. But it also opens up opportunities for vendors that design easy-to-use consumer apps to enter the business realm as well.”

The cloud introduces new agility and capability for all businesses, not just small business. For IT departments in larger businesses, this is a big IT management issue. For smaller businesses, the IT manager is often the business owner or an occasionally contracted on-site technician.  When faced with IT needs in the business, many small business owners will at some level rely upon the solutions they also use in their personal lives – in many cases, there simply isn’t a budget for both.  The line between business and personal has always been “blurry” for the small business owner.

Make Sense?

J

Read more: Disruptive Trends = Emerging Opportunity: Adapting to a changing technology and business environment

What will my business be worth, when I need it to be worth a lot?

bodeguy

Business Enlightenment

Get on the path…

  • Read more about how accountants need business intelligence, too
  • Read more about how there’s no fear and loathing in accounting
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  • Read more about Data Warriors: accounting in the cloud
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Not Everybody’s Accounting Online: Outsourced Bookkeeping and Accounting for “Offline” Clients

Not Everybody’s Accounting Online: Outsourced Bookkeeping and Accounting for “Offline” Clients

With all the focus on online technology, solutions that help you work smarter and not harder, and having mobile access to information at any time and from anywhere, you’d think that the entire world had adopted an entirely mobile and high-tech approach to life and business.   The popularity of software-as-a-service models and apps for just about everything are certainly a testament to the movement toward a more connected and mobile lifestyle and business environment.  However, not every business has adopted a comprehensive paperless, mobile-accessed, virtual working world – not by a long shot.  In fact, more folks than you may realize are still using actual paper, writing things by hand (things like checks and invoices), filing piles of paperwork in stand-up filing cabinets, and generally doing things the long, slow, painful way and then recording it on PC-based spreadsheets.  You know – the way we did things before the Internet showed up.

While paperless offices and technology-enabled approaches to collaborative business are gaining popularity and adopting users every day, there is a community of business users out there who are not as laser-focused on the high-tech approach to online accounting and working closer with their outsourced accountant or bookkeeper.  These business people are just getting the job done, and have found ways to handle their information and processes that work for them.  It is this business user that accounting professionals should not forget as they seek to adopt new and innovative cloud approaches to service delivery, and for a couple of reasons.  First, this type of client is likely to be in need of process support and additional service as the business grows, and the accounting professional is in a great position to help with those needs.  Second, this type of client exists in great number.

Consider the following scenario; a discussion I discovered when perusing a small business forum recently.  The interesting thing is that this is a discussion I see pretty frequently with small business owners and entrepreneurs – the discussion about the value of actual accounting or bookkeeping solutions versus a simple spreadsheet approach to record keeping.

I am the owner of a brand new small business. It has only been up and running for a short time. My accountant is pressuring me to use the online version of QuickBooks, but I am doubtful as to whether this is the right software for me.

I know that QuickBooks has a lot of different features, but I really only need it to track spending and customer payments, and since it’s still early on, I don’t have a lot of either. I would only need the very basics, and would probably only check it every two weeks at most.  The fees they want for the software would add up pretty quickly for something I’m not really going to use much.  My business is very small (just me) and service-based (tour guide), without much potential for repeat customers. I don’t need the payroll, invoicing, or other advanced features.

I honestly think that the easiest thing for me would be some sort of spreadsheet or really basic software that I could put directly on my computer instead of accessing online.

The truth of the matter is that spreadsheets often provide the common ground between small business owners and their accountants.  For a business owner, spreadsheets offer a simple and intuitive way to organize and record information because the column layout makes it easy to understand where to enter which data.  For the accountant, a spreadsheet can fairly quickly be sorted, filtered and prepared as accounting or tax return data.  While working with clients in a fully online, collaborative model may be the “best case scenario” in terms of delivering high levels of service in the most efficient manner, understanding how best to work with those clients in other scenarios is also necessary.  Getting the spreadsheet from this type of client is generally not terribly difficult – they are often more than willing to email it.  As long as the professional has a good document management solution to capture and manage these files, and introduce them into the firm workflow, then working with this type of offline client doesn’t have to be a huge impact to internal firm efficiency.

For accounting and bookkeeping professionals working with small business owners around the country, this type of client likely fits into the “normal” category more than those with a strong motivation to use cloud computing and having a great desire to use the Internet and connected services for everything they can (eventually the “new”normal?).  I believe the reality is that only a small fraction of smaller companies – solo, soho, and small/medium business – are actively managing the majority of their business process and information online.  In fact, Intuit (makers of QuickBooks) and other entry-level accounting and bookkeeping solution providers continue to heavily target small business users who are still tracking their finances using spreadsheets and other methods.  This simplified and after-the-fact approach to spreadsheet record keeping is being further facilitated by the banks and credit card companies providing customers with a greater ability to classify and categorize transaction information, and then quickly download it into said spreadsheet.

Yes, the dichotomy is clear: many small business owners resist (or are, at least, unimpressed with) cloud accounting approaches, yet these very same individuals are likely utilizing cloud services from banks and other financial institutions to support their spreadsheet and checkbook record keeping, as well as accessing email and other services via the web for various reasons.  It makes some sense, though, when you look at it from the business owner perspective.  Their way sounds easier, is less overwhelming, and meets the need – for now.

J

Learn more about Working Online With Clients: How to leverage the internet and cloud computing to work closer with your clients

Read more about Online Accountants and Their Clients: Working Smarter, or just Closer?

Read more about Data Warriors: Accountants in the Cloud

Read more about using the cloud to extend “connectedness” beyond traditional boundaries

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Simultaneous Syncing Sinks Solution: Extend Access but Control Integrations

Simultaneous Syncing Sinks Solution: Extend Access but Control Integrations

Accounts and ProAdvisors: Make sure you “enable” only those who need it

In this wonderfully interconnected world of hosted and online applications and the integrations which complement them, it is important to not let the excitement of connectivity and collaboration replace reasonable control.  While there is much conversation on this topic when it involves file sharing and similar services, the discussion of data synchronization and data integration doesn’t often come up.  However, it has been my experience that there is usually a misunderstanding in how, exactly, a particular sync or integration should be applied and who should have access to the functionality when it is deployed as an extension of the QuickBooks desktop financial software.

An example of the problem might be seen when QuickBooks desktop editions are set to integrate or sync data with a web-based solution such as Method Integration or Santrio Open for Business Order Bridge.  Solutions like these, which extend the functionality of QuickBooks through extending access and integrating data, rely upon QuickBooks integration functionality move data between their solutions and the QuickBooks database.  These solutions are quite beneficial for businesses because they can affordably deliver support for various business functions via a true web application and incorporate QuickBooks data in those application views.  Additionally, this type of solution is able to push information from the web application to QuickBooks, allowing for complete integration of financial and other relevant data.

While having this type of integrated service is beneficial, there are a lot of businesses who don’t fully understand how to appropriately implement the solution and end up creating a great deal of difficulty for themselves.  One of the most frequent failures I have seen when implementing this type of solution is where the customer doesn’t really understand who should or should not have the integration.

When a web-based solution exchanges data or syncs with QuickBooks, a path is created to communicate between the two systems – the web solution and the QuickBooks application and data file.  This path must be open, and both sides of the communication identified, in order for data to sync.  The most important thing to remember is that there should be only one controlling entity on each side handling the integration.   What this means for QuickBooks users is that only one installation – one PC accessing QuickBooks – should be configured to facilitate the primary integration with the QuickBooks company file.

To illustrate, consider an implementation of Method Integration and QuickBooks that was done for a business some time ago.  This business used Method-based applications for a variety of business functions, and those applications used data sync’d from QuickBooks desktop.  Just after implementation, it was discovered that system sync’s were not happening as they should, and sometimes when they went to sync data, it would take a huge amount of time (which was not supposed to be normal behavior).  In short, the system proved to be problematic and, at times, unusable.  But the problem didn’t have anything to do with the Method Integration system, nor the technology.

The problem was that all workstations in the office were set up to sync data between QuickBooks and Method.  QuickBooks was installed on all the PC’s, even though most of the users did not use QuickBooks (they used the Method Integration system to do their jobs), and each PC had the Method Integration sync engine installed and set up to run.  This caused the system to be frequently overloaded with sync requests and caused QuickBooks to behave erratically or crash.  In addition, users who did not need (and should not have had) access to QuickBooks financial information were starting up QuickBooks and opening the company file every day because they thought it was required to allow them to access or use QuickBooks data in the Method Integration system.

The benefits of using web applications which can connect to and integrate data with QuickBooks is that a business can give users functionality and data access required to get the job done, but not expose those users to more software or data than they need.  In most cases, if not all, QuickBooks is not necessary for users of the web application (saving you the cost of purchasing and installing QuickBooks for these users).  Further, to ensure proper functionality and to remove any possible conflict or confusion in the sync process, only one workstation with QuickBooks should be set up to sync data to/from the web solution.  While it makes sense to have a “backup” PC setup with the ability, syncing should remain inactive on this machine unless the primary “sync machine” is out of service.  The key element to remember here is that the data coming from the web application is being added to the QuickBooks company file.  Once the data is in QuickBooks, QuickBooks users may access the data from QuickBooks and do not need the connection to the web application.

When deploying this combination of solutions with a hosting service provider, the same rules will apply.  Only users who need the sync capability require service with both QuickBooks and the integration installed.  In some cases, this may make selection of host services more affordable, as only those who need the “additional application” (being the sync solution or integration tool) require customized service, and the rest of the QuickBooks-only users need standard QuickBooks service.  *It might also be worth noting that many hosting providers do not support “persistent” connections – sync connections which continue to run even when you are not logged in), so syncing of data would only be able to occur if the primary user was logged in to QuickBooks and had the sync integration active on the host solution.

Accounting professionals, QuickBooks ProAdvisors, and small business consultants can help their clients understand the value and potential of extending QuickBooks desktop editions with connected web-based solutions.  The additional value these professionals bring to the conversation is the understanding of the need for structure and control of the data flowing into and out of the financial systems, offering their expertise to ensure that the accountability and appropriate treatment of the information exists throughout the business.

Make Sense?

J

Read more …

There’s a lot of legacy ERP out there, and it’s not going anywhere any time soon

https://coopermann.wordpress.com/2012/05/29/theres-a-lot-of-legacy-erp-out-there-and-its-not-going-anywhere-any-time-soon/

Compliance in the Cloud – their system, your responsibility

https://coopermann.wordpress.com/2012/05/23/compliance-in-the-cloud-their-system-your-responsibility/

Beyond Bookkeeping to Total Business

https://coopermann.wordpress.com/2012/05/25/beyond-bookkeeping-to-total-business/

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QuickBooks Hosting Services and Accounting Professionals

The value of applying an application hosting model for your clients

The concept of application hosting is not at all new.  In fact, there are literally millions of business users accessing hosted applications and similar services every day, and adoption didn’t reach those numbers overnight.  For several years now, Intuit (the makers of QuickBooks financial software, among other things) has even had an “Authorized Commercial Host for QuickBooks” program.  If Intuit recognizes the value of a hosted application service model, then there must be something to it, because Intuit rarely does anything unless it’s big.

The value of application hosting services, such as QuickBooks hosting, may differ from business to business, but the underlying benefits are there for all to achieve.  For some, the main value is in being able to access business information and data while traveling.  Using mobile devices, business users are able to get information on customers, orders, payments, and other valuable data – from anywhere they choose to work.  Being able to keep tabs on the business even when they aren’t there is very important to some business owners.

For others, the value of application hosting services is the collaboration that it enables.  With public accounting in particular, the client business and the accounting professional do not work at the same place at the same time.  Being able to work on the same software and data, and doing that work at the same or different times (it doesn’t matter when or where they work) allows business owners and their accounting and bookkeeping professionals to work seamlessly together in support of the business.  This online model allows the business owner to benefit from better financial data in real-time, rather than waiting for the work to be done after the fact, at the end of the month or year.

The underlying benefit that all parties get from a hosted application and online working model is better information technology management and greater predictability in IT service costs and capabilities.  Businesses need to be able to focus on their business and not on the IT which supports it, and outsource professionals such as accountants and bookkeepers need to be able to work with clients efficiently without having to invest in expensive tools and services to make it happen.  A hosted application approach, when applied to the client business, delivers many benefits to the business owners while at the same time providing tangible benefits in efficiency through more effective time management and improved access to information for the professionals who support those businesses.

When developing a working model for outsourced bookkeeping, accounting, or virtual CFO services, it is essential to recognize that businesses need technology to support their operations, and there may be “line of business” solutions in use as well as accounting or financial software.  Too often, outsource bookkeeping and accounting professionals focus only on the accounting or financial systems, and fail to consider the critical aspects of the operational level applications which support the various functions of the business.   With a hosted application approach, the business solutions in use can be “enabled” – from operational solutions to accounting and finance supporting applications – so that accounting professionals may gain access to the complete realm of business data, putting them in a far better position to ensure that the information resulting in the accounting system is of high quality and may be trusted.

Make sense?

J

Read more about Accountants and Bookkeepers Working With QuickBooks Clients: App Hosting Approaches That Work