Credit Accounting Firm with E-procurement Initiative

As a $17 billion company, privately held PricewaterhouseCoopers has tremendous leverage when it goes to the marketplace to make purchases. Now the company is offering to share that leverage by creating a purchasing consortium. Its new e.conomy marketplace will offer members the ability to purchase products, services, travel and software. It will also cover best practices, contract negotiation, and other content areas. The marketplace was launched in the United States and will expand to Canada, Europe and countries in Asia and the Pacific early next year.

Market Impact

Like the similar announcement by TD Bank of Canada (See TEC News Analysis article: "Bank is First Mover in Canadian E-Commerce" December 27th, 1999), PricewaterhouseCoopers is taking the position that anyone can create a marketplace. While the largest financial consulting firm is hardly "anybody," what we see here is the beginning of a flood of similar ventures from companies of all kinds, including similar consulting companies, banks, other large companies with purchasing leverage, and potentially anyone else. Look for a lot of confusion at the beginning of 2000, with some serious shakeouts near the end.



SOURCE:
http://www.technologyevaluation.com/research/articles/credit-accounting-firm-with-e-procurement-initiative-15381/

Best-of-breed Approach to Finance and Accounting

CODA Group, a finance and systems specialist headquartered in the United Kingdom, offers financial solutions that help companies grapple with international business issues such as language, currency, and compliance. Designed to be an "upgrade friendly system", CODA applications offer open and standards-based reporting tools. CODA's alliance with Microsoft Corp. has allowed it to deliver a range of financial and management accounting systems, and it has made several strategic acquisitions to further strengthen its position as a compliance solution.

Part Three of the Composing Collaborative Financial Applications, CODA series.

Among its recent endeavors, CODA has recently announced new set of financial planning and budgeting products: CODA s-Planning ("s" standing for "standard") and CODA c-Planning ("c" standing for "collaborative"), as well as a range of improved analysis and reporting tools, which will be detailed shortly. Nevertheless, to date, these corporate performance management (CPM) capabilities have targeted mainly existing customers of the CODA transactional systems. These users have focused on financial analytics, budgeting, and planning, either through Microsoft Excel integration within CODA c-Planning and CODA s-Planning, or through a partnership with Cognos for enterprise-level planning and budgeting. CODA's consolidation capabilities have traditionally been limited to the basic ones inherent in Coda-Financials. While these are adequate for simpler enterprises, the vendor has thus far been unable to successfully compete with offerings from specialists such as Hyperion Solutions, Geac (formerly Comshare), Applix, Longview, Outlooksoft, or Cartesis. Yet, the importance of these functionalities has been witnessed by Cognos' acquisition of Adaytum in 2003 and Business Objects' recent acquisition of the specialist SRC. See Financial Reporting, Planning, and Budgeting as Necessary Pieces of EPM for information on the functionality.

Thus, this merger deal should benefit both parties for many reasons. While Simple Concepts should get access to CODA's well developed global distribution channel and benefit from its financial stability, CODA should fill the financial consolidation gaps in its solution. Immediate cross-selling opportunities into CODA's install base will expand further as CODA translates OCRA into more languages. Not to mention, there are opportunities coming from OCRA's prior integration with SAP, Oracle, and other leading enterprise resource planning (ERP) solutions. The acquisition also gives CODA a base for strengthening its direct sales operation and presence in Scandinavia.

The two recent acquisitions came at the heels of CODA's June 2005 launch of a suite of add-on applications that extends the range of planning and budgeting requirements: CODA s-Planning and CODA c-Planning . These could offer more benefits for CODA-Financials users. The suite includes Version 3 of the much talked about CODA-XL application. CODA-XL allows the fairly simple and secure output, manipulation, display, sharing, and input of CODA-Financials data within Microsoft Excel. s-Planning and c-Planning were seen to enable users to carry out a range of day-to-day tasks, such as producing and sharing statutory reports; processing expenses; or even developing and setting financial budgets using CODA-Financials alongside Excel and the other familiar Microsoft Office tools that most organizations probably already have in place. These new products were meant to make CODA-Financials the launch pad for a quicker and easier budget cycle. By combining the functionality and embedded control of CODA with the familiarity and convenience of Microsoft Excel, CODA s-Planning and CODA c-Planning should streamline the seeding, preparation, manipulation, and production of budgets, based on (or update) the user's CODA-Financials data. Moreover, CODA continues to develop its relationship with Cognos, offering the Cognos Enterprise Planning product where clients have wider enterprise requirements. The vendor also uses a mix of partnership and in-house development to address other CPM elements, such as activity-based costing (ABC), strategic planning and scenario analysis, shareholder value measurement, activity monitoring, information distribution, etc.

In addition to the "standard" budgeting and forecasting facilities provided by CODA s-Planning, users have the option to make their entire cycle more coordinated, efficient, and controlled by opting for the "collaborative" add-on of the CODA c-Planning product. This interfaces with the CODA-Control process management solution, adding a facility to publish budgets as CODA-Control web sites and tasks. This will keep all participants informed and aware of the input needed and when it is required. There are also audit trails and document history to support compliance reporting. CODA c-Planning aims to help organizations set financial budgets and collaboratively develop plans, which both reflect top-down business objectives and assess the need to account for bottom-up creativity and realities. For example, it will give budget managers visibility of process bottlenecks, including vacation and sick days of department managers, information on groups waiting for information from subsidiaries, and vice versa. Conversely, many other peer products focus purely on bringing together and reporting the figures in the system, and not on collaborative processes that are key to collecting and verifying the figures in the first place. The application's aggregation features often make the budgeting and planning process quicker, more dependable, and more predictable, giving financial professionals more time to analyze and consider their overall budget before making decisions crucial to the organization's mid-term plans.

Another analytic module worth mentioning is the CODA Collaborative Scorecard, which helps user organizations link corporate goals through group objectives and individual performance. Designed to be deployed to every desktop in the enterprise, the product supports multiple performance management methodologies. Generally speaking, scorecards assist organizations in monitoring their business performance beyond bottom-line results by tracking both financial and non-financial measures, and then reporting them in a graphical user interface (GUI). A key element is the way they cascade corporate goals through the organization, helping managers to set individual objectives, and then aggregate performance results back up through the company structure, so that management can review the contributions made by individuals and groups. This aligns corporate strategy with the activities of individuals within the organization.

CODA believes that scorecards should be a strategic pillar of any analytic framework, bonding personal accountability to the enterprise's overall performance management. Initial releases of CODA Collaborative Scorecard have complied with commonly used performance management methodologies, such as the European Foundation for Quality Management (EFQM) balanced scorecard, Six Sigma, etc. to provide a relatively functional and flexible method of managing and aligning enterprise, group, business unit, and personal objectives. However, one should note that, although scorecards should be the fundamental link between personal performance and the overall objectives of the enterprise, they are frequently the weak link in the CPM closed-loop cycle, either because they are too difficult to deploy widely in the organization, or because they have fixed, inflexible methodology (see Why Most Balanced Scorecards are Subverted).

Related to the above line of products is CODA Analytic Explorer, which is a business intelligence (BI) tool that allows CODA users to carry out multidimensional browsing across CODA-Mart and any other relational data source. It is a generic, on-line browsing tool with both two-dimensional and multidimensional browsing capabilities built in, and has a separately licensable cube builder that provides extra performance. As finance departments struggle to add value to their businesses, performance management enables them to deliver better decisions more efficiently. However, CPM is not about static plans that sit on the shelf and get dusted off at board meetings, but rather about continuously adjusting to the range of inputs that the business is constantly receiving. To that end, CODA Analytic Explorer provides the ability to investigate exceptions and trends quickly and easily, so that corrective actions can be taken, and forecasts and plans reviewed.

CODA-XL is now in its third release. It provides a two-way bridge between Excel, which is indisputably the most popular spreadsheet, and CODA's enterprise-level financial and CPM products. CODA-XL was launched in 2003 and brings the familiarity of the Excel interface to CODA-Financials. It should provide customers with several benefits, such as reduced training for end users of CODA-Financials during implementation. Other benefits typically include the elimination of transcription errors and file-handling overheads during the transfer of data between CODA-Financials and Excel. Thus, it may prevent the proverbial "islands of information," where local systems containing great value and insight are locked on individuals' desktops and personal computers and cannot be shared across the organization. However, unlike some similar products from competitors, CODA-XL goes beyond exploiting the familiarity of the user interface (UI) and makes use of the success that Excel enjoys as an informal business modeling and planning tool. It provides "What If?" scenario testing with the option of writing back from the spreadsheet to CODA-Financials. For example, the CODA Security Model is fully embedded within CODA-XL, thus ensuring consistent data security. This means that while add-ins to Excel deliver rich CODA functionality accessed directly from the Microsoft Office desktop, they must respect the same CODA security, validation, and business rules. For example, Excel formulas referencing live account balances are stored directly in CODA Database, with all necessary authorizations for users appearing down to the spreadsheet cell level. For more on the advantages and the inherent risks of Excel-based tools, see Vendors Harness Excel (and Office) to Win the Lower-end of Business Intelligence Market.

Within CODA e-Finance (a Web-based version of the product), all reports validated and cross-checked on-line to validate, to eliminate separate, unsecured reporting tables. "Lights out" scheduling and Web document publishing also eliminate manual intervention. In addition, the data manipulation capabilities of Excel mean that management accountants can build and model scenarios that can be tested against real data relatively quickly, which can be very useful for creditor and debtor management, customer profitability analysis, and ad hoc queries. Furthermore, US Security and Exchange Commission (SEC) submissions can be made through Microsoft Word documents with embedded "live" Excel documents that do not have cut and paste, export, and manipulation functions, which can introduce the potential for errors. Non-programmatic, wizard-driven automation of data entry with real time validation direct from Excel (transactions, allocations, masters, budgets, and forecasts) also eliminates open database connectivity (ODBC), direct structured query language (SQL) updates, relational database management systems (RDMBS) logons, etc., which are also points of risk.

Last but not least along collaboration lines, CODA Collaborative Close is yet another application built using Microsoft Office technologies, one that is designed to help organizations close their books more quickly, more dependably, and more predictably, giving financial professionals more time to analyze and consider data before making crucial decisions. The product was designed to recognize and support the neglected collaborative processes that underpin period close. Other products in this area focus merely on consolidating and reporting the finance figures, but not on collaborative processes that are key to collecting and verifying the figures in the first place. Unfortunately, verification is traditionally carried out manually, which can be time-consuming and makes the process hard to track and improve.

Period-end reporting has always been a challenge for all accounting departments, and this challenge grows when an organization is distributed. The cost of an extended period close in human resources is considerable, since each extra elapsed day can cost a finance department many days of labor. Period-end closing is a collaborative process of questions and answers, of confirming detailed information, and of individuals collaborating to arrive at the answer and generate a picture of numbers about the organization's current financial situation. Every organization in the world has to address this, and they all have different processes; often, financial processes across corporations vary due to merger and acquisition activity, which has absorbed different groups using different business models. This adds complexity to the task of gathering information to close the financial period, and makes it all but impossible to fully automate using conventional systems. Ironically, the aim is to ensure that accountants spend more time adding value to management and performance information, and less time "chasing" data.

The use of technology to render the process less painful, to enable people to collaborate, to progress tasks, and to automate the final postings may be of help in delivering a true, fast closing process to business. Another potential benefit is that CODA's Collaborative Close may uses only information technology (IT) infrastructure and technology that a customer likely already uses. CODA Collaborative Close uses the latest technologies and features from Microsoft Office 2003, Microsoft SharePoint Portal Server, and Microsoft Office Infopath. These, together with task modeling technology from CODA, allow CODA Close to manage approvals, exception reporting, stock reconciliations, aged debt processes, and a string of other potential bottlenecks in the period-end closing process. The application automatically generates a period-end web site through the Microsoft SharePoint Portal Server. Related links then automatically bring up InfoPath forms to gather information from different participants and to drive period-end processes, while the web site dynamically reflects data in the back-office finance system. Real time information sharing between CODA and Microsoft applications is driven through Office Research Panes in Microsoft Excel, Word, and Outlook.

It is a well-known fact that many accountants currently use Microsoft Office tools like Excel in their closing processbut in isolation. Conversely, CODA Collaborative Close integrates these tools with a wide variety of corporate finance systems to bring a unified approach to the problem, with the likely result of improved speed and control over information gathering, allowing more time for analysis and planning. The idea is to help user organizations meet the regulatory demands of the Sarbanes-Oxley Act (SOX), International Accounting Standard (IAS), Basel II, etc., and also to give finance managers more time to analyze their finance figures, and to think about and plan for the near future. CODA Collaborative Close has been designed to work with extensible markup language enabled (XML)-financial applications from vendors such as Microsoft Navision, Microsoft Great Plains, SAP, and Oracle (including PeopleSoft), as well as CODA's own CODA-Financials.


SOURCE:
http://www.technologyevaluation.com/research/articles/best-of-breed-approach-to-finance-and-accounting-18267/

Your Reference Guide to SMB Accounting Software Features

So, you're looking for an accounting system.

This reference guide provides insight into the accounting features and functions currently available on today's market for small to medium businesses (SMBs). It will help you determine which features your organization needs—or doesn't need.

You can also download an extended guide in Excel format at TEC's Accounting Software Request for Proposal (RFP) Template page.

But first, here's a brief overview:

What Are Accounting Systems?

Accounting systems manage procedures for accurately entering, tracking, and maintaining information related to an organization's financial operations. These accounting applications typically support general ledger, accounts payable and accounts receivable, payroll, job and project costing, and multinational accounting.

Many SMBs require that other functions (such as inventory control, manufacturing management, and financial reporting) also integrate with their accounting system.

About This Guide

Although a full accounting system RFP can contain upwards of 4,000 features and functions, we'll focus on the "big picture" features for now, for (obvious!) considerations of space.

You'll notice that we've grouped accounting features by broad category. These categories correspond to a high-level functional breakdown of software features. In this reference guide, we provide a brief explanation of how each category impacts your accounting processes.

If you'd like more information about a full listing of accounting software features and functions, please visit TEC's RFP Templates page.

Reference Guide to SMB Accounting Software Features

1. General Ledger

Chart of Accounts
The chart of accounts is, for all practical purposes, the business management system. If revenues and costs are not captured and segregated into the best suited categories, the financial statements you produce will be useless.

Transaction Processing
This category describes features that address typical journal entry processes, including general transaction processing, workflow period closing, batch layout configuration, and job cost adjustments.

Month- and Year-end Closing
While you can bill revenue and collect cost information, if this information is not published in the form of financial statements in a timely manner, the statements themselves are essentially useless.

Control Reports
All business management systems must have some form of controls to make sure information is input correctly. Software features covered in this category are designed to accomplish this task.

Financial Statements
Financial statements drive the company. However, for smaller companies this may not be true to the same extent, since the owner or manager should have a "feel" for operations rather than relying on printed reports. Larger companies cannot do this, simply because they are too big.

2. Accounts Payable

Vendor Master File
Master files are the starting point in any application. For accounts payable, the vendor master file must be set up first, as that drives the rest of the accounts payable functions.

Purchasing Controls
While anyone can issue a purchase order, the process should be controlled. This category covers the purchasing process as well as control systems you can use.

Data Input
Once a purchase order has been sent and goods received, the obligation for that purchase needs to be recognized. This category reviews the various steps required to actually get information into accounts payable.

Payables Analysis
Once an invoice has been input, it needs to be approved and scheduled for payment. This category covers those steps.

Check Writing
Once an invoice has been processed and approved, it needs to be paid. This category addresses various check-writing features, including bank account assignment and check formats.

Control Reports
While you may choose to assume that information has been input correctly, that is not always the case. The features in this category address reports that give users the ability to check information to make sure it has been input correctly.

Financial Reports
Once data has been input into accounts payable, users will probably need to review slices of that data to determine if costs are in line, where costs are being incurred, and how those costs compare against other benchmarks.

3. Accounts Receivable

Customer Master File
Accounts receivable starts with customers. This category addresses the processes whereby you can set up customers, and define all the controls relating to that customer.

Customer Relationship Management (CRM)
CRM and its relatively lightweight cousin, contact management (CM), are the keys to managing your relationship with customers.

Invoicing
This category covers the invoicing processes you should adopt to send invoices quickly and accurately.

Cash Receipts
Customer payments must be received in a timely fashion, recorded properly, and deposited into the bank as quickly as possible. This category includes features for variable payment terms, less-than-full payment, and so on.

Debt Collection
Recording profitable business counts for nothing if you are not receiving payment in a timely fashion (or at all). This category covers some of the procedures you can adopt to make your customers pay you in a timely fashion.

Control Reports
While you may choose to assume that information has been input correctly, that is not always the case. The features in this category address reports that give users the ability to check information to make sure it has been input correctly.

Financial Reports
Once data has been input into accounts receivable, users will probably need to review slices of that data to determine if revenues are in line, where revenue is being generated, and how that revenue compares against other benchmarks.

4. Payroll

Employee Files
The payroll application will not operate efficiently unless all parameters have been defined or set up. Features in this category cover typical setups, such as pay periods, deduction calculations, sick leave accrual basis, and so forth.

Human Resource (HR) Management
HR applications track detailed information for each employee. If users need to track educational qualifications, training, and other activities for employees, they probably require some form of HR application.

Canadian Payroll Processing
If your organization has Canadian employees, you will require a payroll system that meets various Canadian regulations. This category covers some of the more common requirements.

Data Input and Cost Distribution
Payroll information drives not just the production of payroll checks, but also the distribution of those costs to various departments and activities.

Payroll Check Writing
This category covers such features as flagging abnormal checks, voiding or reprinting selected checks, direct deposit, facsimile checks, and so on.

Control Reports
While you may choose to assume that information has been input correctly, that is not always the case. The features in this category address reports that give users the ability to check information to make sure it has been input correctly.

Financial Reports
Once data has been input into payroll, users will probably need to review slices of that data to determine if costs are in line, where costs are being incurred, and how those costs compare against other benchmarks.

5. Inventory

Inventory Master File
As with all other applications discussed up to this point, the inventory application will not operate efficiently unless all parameters have been defined or set up. This category covers such parameters as customer price matrix options, bar code tracking, and inventory costing methods.

Inventory Control and Assembly Systems
There are any number of activities that control how goods are received, stored, assembled, and ultimately shipped. This category addresses a variety of features, including bill of material types, computer-aided design (CAD) integration, tool management, work orders, and so on.

Data Input and Cost Distribution
Inventory information drives not just the shipping and receiving process, but also the distribution of those costs to various departments and activities.

Receiving Activities
This series of features highlights the receiving process and its many component activities.

Shipping and Withdrawal Activities
Once an order has been received, the objective of the exercise is to ship the goods to the customer as quickly and efficiently as possible. In some instances, the shipping is internal only, with goods being sent to a production line. This category of features traces each of the steps necessary to get material where it needs to go.

Financial Reports
Once data has been input into inventory, users will probably need to review slices of that data to determine if costs are in line, where costs are being incurred, and how those costs compare against other benchmarks.

6. Job and Project Costing

Job Initiation
The process of setting up a job is similar to setting up any other master file. First you have to define system defaults. Then you define how the system is going to work. Finally, you define the jobs themselves.

Data Input and Cost Distribution
Once a job has been launched, cost information will flow into it either directly or from other applications, such as payroll, accounts payable, and inventory. The key to the success of any job-related organization is allocating costs to jobs accurately and in a timely manner. Once the actual costs have been posted to a job, managers can control that job and bill for the work done.

Job Control
Small jobs are relatively easy to control. Larger jobs may be so complex that several people may act as managers. In cases like this, it is very easy to lose track of costs and labor. This category covers some of the support a business management system can provide.

Cost Analysis and Reports
While it is important to post all costs to jobs, it requires some degree of study to make sense of this information. This category covers some of the activities and information managers may need to help them control each job.

Job Invoicing
Collecting cost information is the first and most important step, but if those costs are not billed properly, then all control efforts go to waste.

7. Fixed Assets

Equipment Files
Equipment files perform the same function as master files for customers, employees, etc.

Cost Calculation and Distribution
Once an asset has been acquired, its acquisition cost must be amortized over a period of years. This category covers functions that control that process.

Reports
Users need to access reports that analyze depreciation. This category covers such features as cost distribution reports, maintenance cost analysis, and detailed fleet maintenance analysis.

8. Order Entry

Order Entry (Set Up)
Order entry is not just about taking orders and subsequently shipping goods. There are many other activities you need to consider when you set up an order entry system. This category covers some of those functions and activities.

Order Receipt
The process of receiving an order can be simple or it can be complex, depending on the nature of the order, how it is recorded, and the industry in which you're operating. This category covers various aspects of the order receipt process.

Order Tracking
To assume that an order has been received is a mistake. Anything can happen to prevent an order from being shipped or delivered on time. This category covers functionality that help users track orders from the moment they're placed to the moment they're delivered.

Shipping
The process of actually getting a shipment out of the door can be complex as well as costly. This category covers some of the activities that can be enhanced by a well designed business management system.

Invoicing
Once a shipment has been dispatched, invoices should be printed as soon as possible. This category addresses the procedures supported by a business management system.

Reports
Reports coming from the order entry system should help you get shipments out the door efficiently and on time—and also learn where improvements can be made.

9. Budgeting

Budgeting (General)
This category covers features relating to the budgeting process.

Review Process
Before a new budget can be created, users should review the results from the previous year (and earlier). This may give them trend information that will be useful when establishing a new budget.

Construction of New Budget
The actual process of constructing a new budget can be fairly simple or very complex, depending on the nature of your business, as well as your inclination to split the budget into smaller pieces.

10. Manufacturing

This category includes features for

* product costing
* master production scheduling (MPS)
* material requirements planning (MRP)
* capacity requirements planning (CRP)
* shop floor control
* quality control


11. Multinational Accounting

This category includes features for

* installation and support
* basic information
* currency rate tables
* transaction entry
* gain/loss reporting
* financial/management reporting

A comprehensive RFP will also include general considerations, including reseller and value-added reseller (VAR) channels and industry-specific modules. It should also address technology-related information, such as technical requirements, control and audit features, and operational functionality.


SOURCE:
http://www.technologyevaluation.com/research/articles/your-reference-guide-to-smb-accounting-software-features-19938/

Geac Upgrades Accounting And Human-Resources Apps -- SQL Release 6.0 Simplifies Purchasing And HR Services For Midsize Companies

Geac SmartEnterprise Solutions released an updated version of its human resources and accounting applications for midsize companies at the beginning of January. SQL Financials and HR Release 6.0 are available immediately, as are a set of employee self-service applications that integrate with the suite. Geac SmartEnterprise, a division of Geac Computer Corp., acquired the SQL suite last year from Clarus Corp. The company says a key benefit of HR Release 6.0 is tight integration with the Clarus eProcurement suite, an application available separately through Clarus that simplifies and controls the purchase of office supplies and services by individual employees. Used with Geac's SQL financial suite, eProcurement enables a seamless purchasing process that links requisition activity directly to accounting systems, such as budgeting and accounts payable.

In addition, the rollout of a new component of the SQL HR suite called HRPoint gives users access to HR, benefits, and payroll information through a Web browser. Geac says HRPoint can reduce administrative costs and improve HR service to employees by eliminating paperwork and phone calls. Beth Price, Geac's human resources management systems product manager, says the SQL product line is aimed at companies with less than $1 billion in annual revenues, which typically require less complex tools than the high-end packages offered by Oracle, PeopleSoft, and SAP. SQL Release 6.0 and HRPoint are compatible with the latest versions of Microsoft SQL Server and Oracle database platforms. Financial and HR packages start at $40,000 per module, while HRPoint starts at $70,000. Pricing varies according to the number of licensed users.

Market Impact

Geac has proven itself an adroit and disciplined acquirer of application software businesses. The latest announcement of its expedient incorporation of Clarus' former product line is the most recent example. Furthermore, the mission-critical nature of its solutions makes the company a "first call provider" in some esoteric markets whose customers turn to it first for further system enhancements (See user recommendation). Geac intends to mine its existing large client base. While we believe that Geac's product strategy against the largest ERP vendors is shrewd, one should not discount fierce competition coming from its nimble mid-market competitors, like Lawson Software and Great Plains. These vendors have been offering self-service applications via the Web for over a year. Geac also trails these vendors with its CRM capabilities, which may prove detrimental to its new license revenue growth.


SOURCE:
http://www.technologyevaluation.com/research/articles/geac-upgrades-accounting-and-human-resources-apps-sql-release-6-0-simplifies-purchasing-and-hr-services-for-midsize-companies-15514/

Accounting for SMBs: A Solution Beyond Entry-level Systems Red Wing Software

The market for middle-market accounting software spans a large range based on price, functionality, and the size of the target organization. Most people are familiar with entry level products such as QuickBooks, Peachtree, and Simply Accounting and they are equally familiar with higher-end products such as Microsoft Great Plains Edition, MAS 90, ACCPAC Advantage Series, and Navision. Unfortunately there is a significant gap between these two classes of products and that's precisely where products from companies such as Red Wing Software compete.

Company History

Founded in 1979 with offices in Red Wing, Minnesota (US), Red Wing Software (http://c.technologyevaluation.com/?u=/cp/TEC_article_20050121_al.asp&cl=1&i=712&c=205&l=1) offers a strong middle market accounting system, as well as industry specific products that are leaders in their respective fields. In 2001, three companies (Red Wing Business Systems, Champion Business Systems, and FMS/Harvest) merged to create Red Wing Software, Inc. (1-800-732-9464). The merger was strategic and consolidated two of the leading agricultural products (AgCHEK by Red Wing Business Systems and Perception Accounting by FMS/Harvest) under one corporate umbrella. Additionally the merger allowed Champion Business Systems to offer a mid-range, Windows-based accounting product (TurningPoint) to its large DOS customer base. Red Wing Business Systems developed TurningPoint from the ground up with their DOS users in mind. Consolidating resources further provided each company the ability to enhance quality support services for their product lines, something on which each company prides themselves.

Agricultural Products

Agriculture (Ag) has always been a strong niche market for Red Wing. Focusing on financial management tools for producers (farmers and ranchers) and agribusinesses, AgCHEK and Perception Accounting are Ag-specific and recommended over general purpose, small business products. Cow/Calf is a complete herd management tool with analytical reports that track individual animal information, veterinary history, weaning, yearling, etc. for bulls, cows and their calves. Crop/Chemical and Livestock Management are comprehensive production management applications that integrate with AgCHEK accounting.

TurningPoint

TurningPoint is Red Wing's premier business product. First introduced in 2001, TurningPoint targets companies with revenues of $1 to $25 million (USD). Written in Visual FoxPro, Red Wing does not provide source code, but does provide COM object technology to integrate third party applications. Five user-defined fields are provided for each master record and Crystal Reports is used as the reporting engine. User-defined reports can be created, if Crystal is purchased separately.

TurningPoint 3.0 was released in July 2004. Development of TurningPoint is based largely on the company's knowledgebase of customer requests and suggestions. In addition, Red Wing strives to develop relationships with alliance companies to form integrations, such as point of pale and dispatching services, to provide a broad suite of capabilities for customers and to drive new market development.

TurningPoint consistently receives high accolades from industry experts and publications. Standard pricing is $895 (USD) per module. A bundled core accounting system costs $2,495 (USD) while a bundled inventory suite costs $4,495 (USD). TurningPoint provides value for wholesale distributors with an expansive list of capabilities, including multiple-location inventory, drop shipments, and up to twenty pricing levels per item for customers with complex distribution methods.

It is also a prime choice for agribusinesses, due to 1099-Patronage export to payroll. The 1099-Patronage export to payroll is designed for US agricultural cooperatives that use the 1099-Patronage form, which deals with the allocation of dividends. The feature allows unlimited and customizable units of measure and customized labeling, and integration to a payroll product (Red Wing Payroll) that includes piece rate, multiple language pay stubs, and government reporting specific to migrant workers.

TurningPoint is easy-to-use with a design that follows the Microsoft Explorer hierarchy of folders. Due to TurningPoint's modular nature, users can customize their solution by purchasing only the pieces that are necessary and then grow into a more advanced solution as needed.

Currently TurningPoint supports the following applications:

* System Manager
* General Ledger
* Accounts Receivable
* Accounts Payable
* Purchase Orders
* Inventory
* Order Entry
* Red Wing Payroll (integrated or as a stand-alone option)

TurningPoint - What's Interesting

TurningPoint has been designed to serve the needs of companies with 5 to 100 employees in the $1 to $25 million (USD) revenue range looking for software that costs $5,000 (USD) or less. As such one, would not expect to find sophisticated functionality. However that's not necessarily the case here. The product is very well designed with menus and screens that are crisp and easy to understand for even a novice user. Although some training will be required, users should be able to move quickly to full utilization of the system.

Other features include pop-up reminders that can be created to alert users to meetings, tasks, and exceptions that require their attention. While these alerts are not that sophisticated, they certainly will be sufficient for most middle market companies. Also, the Document Manager can be used to link files to master records and Microsoft Office can be launched from within the system and merge documents created for announcements or even to remind customers about overdue accounts. TurningPoint can also integrate with GoldMine as its contact manager.

Menus can be also be customized or user-defined as an alternate to the main menu for specific, user functions. These personal task lists can then display only those functions to which a user has been assigned rights. Entries can also be customized by changing field labels and skipping fields.

Also, reports created in TurningPoint can be saved or e-mailed in multiple formats, printed for any time frame, and information can be exported in various formats including Excel. Also, the Order Entry screens are very well designed and allow users to move from section to section quite easily. Users can even accept deposits from an Order Entry screen.

TurningPoint also has light manufacturing and production planning features that are superior to other products in its price range. For example, while most products support assemblies, TurningPoint takes this concept one step further. It allows users to create production plans that list the sequence of events that need to be followed. This is particularly useful when an order calls for the creation of a set such as a table and matching chairs. Users can also create a production plan that combines assembly operations to create a single plan. Finally, TurningPoint allows users to include labor costs in an assembly, thus reflecting the true cost of each assembly (parts and labor). This is the only example in this price range of which I am aware that allows users to control production without having to move to what may be an overly complex MRP application.

Moreover, TurningPoint has features that are not supported by lower-end products. For example, it allows multiple substitutes for each inventory item and it tracks vendor item IDs, and will print the vendor part number on a purchase order.

Most notably, however, is that TurningPoint also has features that are not supported by many higher-end products such as multiple locations, including costing and pricing per location. It will also create a suggested purchase order based on either a forecast or the order point within inventory. In addition, users can create a purchase order from an Order Entry screen for non-stocked items or drop-ships.

Although TurningPoint does not support highly sophisticated pricing schemes, it does support product line pricing, unit of measure pricing (e.g. case and item) as well as location pricing. Users can set up twenty different prices for an item for any one quantity price point. This allows users to associate a customer to one of these price points and therefore build a fairly sophisticated matrix.

SOURCE:
http://www.technologyevaluation.com/research/articles/accounting-for-smbs-a-solution-beyond-entry-level-systems-red-wing-software-17737/

Project-oriented versus Generic GL-oriented ERP/Accounting Systems

The unique business needs of project-oriented organizations, when addressed by large ERP vendors that offer general-purpose enterprise software, require heavy customization in order to work. On the other hand, when project-oriented organizations turn to small off-the-shelf project-management solutions, these solutions are soon outgrown by the user company. These organizations are looking for systems to support the project manager, who is responsible for sharing and tracking the revenue, expense, and profitability of a project. Most enterprise-wide business systems sold by software vendors are general purpose in design and without significant tweaking, they do not address many of the unique requirements of businesses engaged primarily in providing products and services under project-specific contracts and engagements.

Project-oriented organizations have many project-specific business and accounting requirements including the need to track costs and profitability on a project-by-project basis, to provide timely project information to managers and customers, and to submit accurate and detailed bills/invoices, often in compliance with complex industry-specific and regulatory requirements. Yet, traditional generic GL-oriented accounting systems have not been designed with project phases, work breakdowns or detailed time capturing in mind, and thus, they can merely report how much has been spent or collected, but not why a certain project is losing or winning money.

Not many enterprise products will support the following project-based processes: job costing, managing the sub-contactor, financial reporting, managing the workforce, process time and expense, winning new business, purchasing goods and services, managing the project, and building to order. If these high-level processes sound too ordinary, then digging to a level deeper might reveal their true intricacy and attention to detail such as employee time, billing rates, budgeting, collections, or project proposals, which are supported by only a few vendors.

For example, the job costing process can be broken down into the following steps: setup project work breakdown structure (WBS), pay suppliers, pay employees, accrue purchase orders, allocate indirect costs, calculate estimated time to completion, calculate contract ceilings, compute revenue, bill customer, and report the project status. The process time and expense cycle would have the following steps: create project, create project workforce, enter timesheets by project, enter labor adjustments, enter travel expenses, apply project business rules, approve time and expenses, pay expenses and payroll, bill expenses and payroll, revenue recognition, and project status reports (PSRs), which are used for period reporting on a project/task/phase level, and which can be regarded as the financial statement for the project.

The managing-the-project process would feature the following detailed steps: create opportunity plan, establish detailed scope of services, create project plan with work breakdown structure (WBS), establish task schedules, search and add resources to plan, establish budget at resource level, add consultant and expenses to project plan, add direct costs for plan, establish profit performance, save baseline budget, monitor time and expense costs, monitor schedule projected profit and revenue, and submit the project deliverables and closeout project. A build-to-order process would involve ERP materials management functionality through support for the following steps: customer demand, bills of materials (BOM)/routings, engineering change notice (ECN), materials requirement planning (MRP), capacity planning, purchase requisition/order, receiving and quality assurance, fill inventory, issue manufacturing orders, final subassembly and finished goods, customer delivery, billing, revenue recognition, and PSR.

Dealing with Government Contracts

Furthermore, many project-oriented organizations provide products and services under government contracts, and project accounting for these organizations often requires the use of sophisticated methodologies for allocating and computing project costs and revenues. There are many different types of contracts governments use and within each of those there are dozens or more variations, whereby each variation will drive its own type of billings, revenue recognition and requirements for reporting back to the government customer.

The US government requires its contractors to collect and allocate costs in certain ways; for example, according to the Defense Contract Audit Agency (DCAA) rules, labor costs must be recorded daily. Also, a contractor is required to keep track of several contracts simultaneously, meeting the rules for different types of contracts and being consistent in accounting for a number of indirect costs. According to the Small Business Administration Pro-NET sourcing service database, there are tens of thousands of small and minority-owned companies that are doing business with the federal government. With the new emphasis on improving homeland security and expanding anti-terrorism operations around the world, many of these firms will likely experience significantly greater demand for their services and grow rapidly over the next several years.

Expanding Market

Additionally, service business application software systems are expanding as a result of a number of economic trends. Service organizations traditionally have utilized project accounting more than manufacturing firms due to the need to customize services for each client and to properly allocate the associated revenues and costs. Therefore, as the shift from a manufacturing-based economy to a service-based economy continues, the market for project-oriented organizations is expanding. Furthermore, the trend towards outsourcing an increasing range of activities broadens the market for project-oriented organizations as both customers and vendors need to track the costs associated with their projects.

Finally, many organizations with significant internal development activities can benefit from the use of project accounting systems to closely monitor progress and costs. Also, although somewhat conversely, more progressive firms may even try to boost their marketing, advertising, and PR expenditures in order to gain more project contracts during the market contraction, where for example, a proposal automation capability can come in handy. While project management and resource planning software applications help service organizations deliver within a budget, in the long term, these organizations need to win a new stream of projects or customers, which involves pre-sales customer relationship management (CRM), marketing and proposal management, and post-sales elements like travel and expense (T&E) management.

As the number and type of project-oriented and professional service organizations increases, such businesses are demanding increasingly sophisticated tools to address their core information and accounting needs, including project accounting, employee time collection, project budgeting, project reporting, CRM, sales force automation (SFA), and proposal generation. At the same time, these organizations are recognizing that because most aspects of their businesses revolve around their customer project relationships, they can achieve efficiencies in a number of project accounting and core back-office business functions. These accounting and business functions such as general ledger, accounts payable, accounts receivable, materials management, and human resources, are supported through the use of software applications designed to address the special needs of project-oriented organizations. Like other businesses, project-oriented and professional services organizations are also demanding solutions that allow them to combine their business software applications into a single integrated, enterprise-wide system.

Time is of the essence for any business that bills for its services rather than sells a physical product, but the concept can be particularly tricky for design/construction firms that may need billing at different rates depending on, for example, project phase, task, client type, or escalation clause. At the same time, the industry is quite fragmented, with legions of specialist contractors, and it also has a long tradition of technophobia.


SOURCE:
http://www.technologyevaluation.com/research/articles/project-oriented-versus-generic-gl-oriented-erp-accounting-systems-19393/

Accounting for SMB Showdown

General Ledger (G/L)
Both solutions offer a full set of chart of accounts. Besides the fact that Infor FMS SunSystems supports variable length segments while Exact North America Software's Exact Globe Enterprise uses account identifications that are of fixed length, there are no significant differences in this section.

There are three differences within month- and year-end closing:

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Infor's FMS SunSystems leads in flexibility to perform single-period and temporary year-end closings, whereas Exact North America Software's Exact Globe Enterprise has a more restricted set of options.
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Infor's FMS SunSystems offers multiple tests of year-end closings, whereas Exact North America Software's Exact Globe Enterprise limits that activity to individual periods.
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FMS SunSystems allows posting of account summaries to the GL, whereas Exact Globe Enterprises requires the exact details.

Accounts Payable (A/P)
Differences in A/P are within the products' invoicing functionality, in the areas of contract price management, partial or extended payments, and in their abilities to examine various credit criteria (customer, product, etc.).

Both products are rich in A/P controls and functionality. The major difference between the two vendors is that Infor provides interfaces to the Web for e-procurement, whereas this remains a future deliverable for Exact Globe Enterprise.

Accounts Receivable (A/R)
The most important aspects of A/R are the ability to update collections, and the ability to manage credit. FMS SunSystems leads in the number of options. It can provide credit notes by line item, whereas Exact Globe Enterprise does it by invoice. Automatic intercompany sales transfers is another area where differences arise between the products: FMS SunSystems does it automatically, while Exact Globe Enterprise requires manual intervention.

A cash receipts comparison shows a large difference between the two products. The difference has to do with routings. FMS SunSystems will route outstandings to a collection agent that is assigned to that account, while Exact Globe Enterprise does it to a single resource. As for collection agency tools, FMS SunSystems provides automatic past collection histories. With Exact Globe Enterprises, you must generate the information manually via a display or online report. Both products are industry leaders when it comes to the essential tasks for cash receipts; this module within both products is essentially identical.

Fixed Assets
Both solutions correspond for most of the essential elements of fixed assets. However, FMS SunSystems goes beyond Exact Globe Enterprises with better handling of "equipment leasing." FMS SunSystems also provides functionality for tracking leases from other modules as well as generating alerts when a lease's termination date is approaching.

Budgeting
When we drill down into detailed budgeting functionality, there are essentially no major differences between the two products. FMS SunSystems' product interfaces to external budgeting systems, while Exact Globe Enterprise does not. FMS SunSystems allows comparisons of budget variables, also in contrast to Exact Globe Enterprise. FMS SunSystems offers the ability to add a percentage to a budget to compensate for inflation, and automatically determines a new budget.

Multinational Accounting
FMS SunSystems supports 27 languages, whereas Exact Globe Enterprise supports 11 languages. In budget postings, FMS SunSystems has a distinct advantage in that it can perform a semi-automatic re-evaluation of transactions above a threshold value.

You Can Do Your Own Custom Accounting Software Evaluation

Now that you've had a high-level look at a couple of accounting for SMB vendors and solutions, how do you determine which accounting solutions are the best fit for your company's unique needs? We recommend you do a quick comparison using TEC's Accounting Evaluation Center.

TEC's Accounting Evaluation Center allows you to set priorities that reflect your organization's business model and special needs at every level of functionality. At the modular and submodular levels—even down to the individual criteria—you can tell the system which business processes are critical, less important, or not important to your organization. The system then compares your priorities against the vendor responses to produce a shortlist of solutions. You get a custom comparison—one that ranks vendor solutions on how well their functionality matches the business requirements of your organization.

We know of no better way to quickly and easily evaluate accounting solutions, and we invite you to give it a run-through. Plus, you'll get your results in mere minutes. Simply click on the link below to visit our Accounting Evaluation Center and conduct your fast, free custom accounting solution comparison. After all, there's no other organization quite like yours.



SOURCE:
http://www.technologyevaluation.com/research/articles/accounting-for-smb-showdown-19392/