Three Things That You Should Look For In A Project Accounting Software Package

Feb 112011

This may not apply to all companies, but generally speaking companies need to have project accounting software in order to manage their projects effectively. This software is really needed because it can help project managers with handling the project finances. Every event where money is used is accounted for by this software and it will also prevent you from spending “generously” on items which may not be needed. Now that you know how important it is to have this project accounting software, here are the three things that you should consider before you buy one.

1. Popularity

Although this point may not be an absolute indication of the software quality, popularity of the accounting software is still an important aspect that you should consider. Taking note of the popularly used programs in the market will enable you to narrow down your choice to at least two or three software programs. You can do this by asking some of the people you know who have been exposed to this type of software, by participating in a couple of Internet forums, or by simply researching the different software on the web. This research is very important so that you do not waste your time buying a product that does not have any approval rating whatsoever. If the product is not a little bit popular, then it probably is not good at all.

2. Functionality

This is another aspect of the software that you need to look into. Before buying project accounting software, you must first ask yourself this question: what do I really need? When you have answered this, you can now choose a software application that will meet your needs without the unnecessary features that common programs have. A lot of people prefer to use programs that have a lot of features that will enable them to do complex accounting tasks while others prefer to use those simple programs with simple features that can meet their needs.

3. Price

Fist and foremost, it is never a good thing to use project software that has been pirated or stolen from download sites. Even if the chances of you being caught using a pirated software are slim, the ethical and moral implications of such actions will be tremendous. That being said, everyone should look into the price of project software before buying. If you find something that will meet your needs, then you should buy it as long as the cost is within your budget. If you find a package that you like that is out of your budget, then you can either save up and buy the product later or you can move on to another option.

All the three things mentioned in this article are important to remember when selecting best project accounting software for your organization. Remember these criteria when you go shopping for project software. If you don’t, then you’ll likely waste your money on software that doesn’t work for your company.

The Basics Of Project Accounting Software

Feb 042011

Company projects are always hard to handle. You have to take note of a lot of things before the project can be successful (the ability to multi-task is a must). To start, you must have planned everything down to the last detail. With that planning, you also have to take note of all the needed expenses for your project. Keeping a detailed explanation of all the money that you need to spend will give your company an idea of how much you need. For all of the financial aspects in your project, you will want to use project accounting software to make your job easier. If you are not familiar with this type of accounting software, then you need to know some of the basic modules which take care of the different sections in accounting.

1.     Money Received

This section in accounting deals with all the money that you have received for the implementation of your project. This section is brought about by the planning of the budget that you have done prior to the start of the project. The company first assesses how well you have planned and how well you can allocate your resources. If the board or the chairman approves all of the plans and the allocation of money for your project, then you will be given a go signal to start your project. Using project accounting software to demonstrate to the board how you will allocate your resources will help your project get approved. The software will also help you keep track of the money you have received.

2.     Accounts Payable

With the planning of the budget and the acceptance of the money for the project, you must be able to spend all the money allocated to your project wisely. Fortunately project software takes note of all the bills that you have to pay. Using the software, you enter all the money which you have spent during your project. Keeping track of all payable entities of your project will help you to know where the money has gone to and if the money was well spent according to the plan. When this area of the accounting software is monitored frequently, then you will be assured that your project is sticking closely to the budget and that no amount of precious resources are ever wasted.

3.     Stock or Inventory

The stock or inventory portion of project software is the area in which you will be able to know and control all the inventory that you own. The type of inventory that you manage will vary depending on the type of project that you have. If you have a project that is based on construction for example, then stock or inventory may pertain to the number of cement sacks, the number of glass windows to be installed, or the amount of lumber needed for scaffolding or decorative purposes. These stocks are very important for the success of your project which is why you should treat them like gold.

These three modules are only few of the many that you will find in project accounting software.  If you paid a lot of money for a software program that does not have any of these modules or lacks even one of these modules, then you have likely wasted your money. You are better off using a common spreadsheet if these modules are not present.

Does My Company Need Project Accounting Software?

Jan 282011

When you are assigned to a project by the company, you are not only accountable for the money used on the project but you are also entrusted with a big responsibility of finishing the project with flying colors. This thought might put a lot of pressure on you because of the fact that all of your bosses or superiors are counting on you to make the project successful. The way you see it, there are only two outcomes of a project and that is either to fail miserably or to finish it successfully. Bearing this thought in mind, you will probably want to be on the success side of the continuum. In order for you to be there, you must use project accounting software.

Project accounting software is something that many companies use in order to keep track of the finances which are needed to make the project a success. This software is able to make the project manager’s job of monitoring finances easy because of the common accounting capabilities that this software has. Despite its perceived use and capabilities, it is still debatable if a company needs to have this type of software or not and the reasons for this are explained in the following paragraphs.

Why You Need It

You need to have this software if you have a big project that requires a lot of money management. With this technology you won’t have to try and keep track of things mentally, you will be able to hold money in a safe place and still be efficient in receiving and paying several people. With the use of this software, everything that you need to spend will be monitored down to the last cent. You will never have to waste anything because all finances will be accounted for. To make everything easy for you, the accounting software interface will make you see all of the financial activities in your project with just one glance. That, to me, speaks of convenience in its purest sense.

Why You Don’t Need It

On the other side of the coin, many experts believe that using project accounting software may not be useful for all companies. Those companies that do not have a lot of projects lined-up annually may not need to have this type of software. All of their accounting needs may be done easily through the conventional methods and going for this type of software may only be a waste of money. It is commonly believed that those companies which are project-oriented will benefit the most out of this software but if your company is otherwise, then this software is not right for you. After all, what is the use of buying an expensive and well designed software if you are only going to use it once or twice in a given year?

Knowing these two arguments will help you decide whether you truly need a project accounting software package or not. If you work in a project-oriented business then this software might be just the ticket for you.

Project Accounting Software: What to Expect From It

Jan 212011

Accounting is very important for every company. No company can really thrive without the presence of an accountant because money will always be a constant (and accountant’s flat out know how to manage money). It is well-known that accountants are those professionals who will take care of the financial expenses of the company through certain activities like tracking and monitoring. Nowadays, accounting may not be limited to routine matters because it is also needed in exciting projects that the company has. Nowadays most accountants use project accounting software for this type of work.

If you are new to the accounting software world, you should be oriented quickly with the common things that you can do with this technology. One thing that you can do easily with accounting software is the monitoring of the time and the expenses used by your employees. In every project that you have, workers will always be needed. These people will carry out several tasks needed to make the project successful. Of course, labor does not come cheap which is why you have to take note of how much you are going to pay these people and at what basis are they receiving the money (by the hour or day).Project Accounting Software

One thing that you should know about project accounting software is that this software will help you track the general costs of your project. Every single piece of money (down to the last cent) will always be noted and accounted for when it comes to every project. Knowing where the money is and how well it was spent will be very easy with this software. One of the best features is that you can break the whole project down into different areas and track each area’s revenues and expenses. This way, you will have a great overview of how well the project is moving and how much money is spent in each area.

The last thing that you should orient yourself with when it comes to project accounting software is that the software can track the amount of money spent in a given time period. This aspect in the software is very important because you can monitor each and every area in your project and determine if money was spent wisely during a certain time period (with manager A) and then poorly during a different time period (with manager B). This is a great evaluation tool for upper-management.

Although keeping track of finances may seem very basic, this part of the software is actually a very crucial one. It lets you know if the money you have planned for a certain activity at a particular time is enough to meet the needs of your project.  If you are running on a tight budget, then knowing when money is short can be really helpful because you can take measures to either increase funding or cut back on costs.

Orienting yourself with the common features which are found in a project accounting software package will help you work efficiently on your projects. Your knowledge on how to use this tool properly will be your big ticket to the success of your project.

Fund Accounting Software

Dec 082010

This page is designed to help you find the best accounting software for your nonprofit organization. Let’s admit it, fund accounting is an interesting creature. I’ve already written some of the basics of fund accounting, but as we talk about fund accounting software, we will review some of the basics.

Who needs fund accounting software?

Organizations that are not-for-profit. Businesses that are out for gain don’t use this type of accounting. Nonprofit organizations such as governmental organizations, religious organizations, humanitarian organizations, charities, etc. (“any organization that does not distribute it surplus money to owners or shareholders”).

Why do nonprofit organizations (also called NPOs) need fund accounting software?

Well technically they don’t need the software. If an NPO wanted to meet all of the requirements by doing the accounting by hand then it could (this would probably take forever).

Perhaps the more important question is, “Can a nonprofit organization use business accounting software or does it need specialized fund software?” You could probably finagle your way into using normal business accounting software, but it would be a headache (if not now, then later). You see the rules are different for businesses and nonprofits. When nonprofits are audited their financial statements look quite different. The main difference is the way that net assets (assets minus liabilities) are presented in the financial statement of an NPO.

The financial statements of NPOs are governed by FASB Statement 116 and 117. Basically the idea is that you have three categories of Net Assets: Unrestricted, Temporarily Restricted, and Permanently Restricted. Unrestricted net assets are assets (usually donations) that have no strings attached. Temporarily restricted are donations or contributions that have some strings attached: i.e. the donor says the money must be used at a certain time or for a certain purpose. Finally permanently restricted net assets are donations that are never to be directly used; however, any interest made off of these donations can be freely used. Most organizations set up funds to keep track of the different types of donations that they receive. Hence the need for fund accounting software.

What are some good fund accounting software options?

QuickBooks NonProfit

QuickBooks accounting software is probably the most popular accounting software available in both the business sector and the nonprofit sector.  This software is easy-to-use. One of its best features is that it comes with an example nonprofit organization already setup on it. You can model your accounting system after the one that has already been set up.

Sage MIP Fund Accounting

Sage also offers extremely popular accounting software for nonprofits. One great feature in Sage MIP fund accounting is the flexible reporting. Nonprofits have unique financial statements and it’s nice to have a piece of software that will create these reports for you in accordance with the rules set by the Financial Accounting Standards Board (FASB).

The Financial Edge by BlackBaud

Blackbaud is a bit different from the previously mentioned options. Whereas QuickBooks and Sage focus on almost all types of accounting software, Blackbaud only focuses on nonprofit accounting software. Their slogan is fairly telling, “Looking for a nonprofit technology partner instead of just a software vendor? We’re so glad you found us.” They have positioned themselves nicely to help NPOs.

AccuFund Accounting Suite from Accufund Inc.

Accfund is another leader in the fund accounting software area. They have been around since 2001 and they are focused on nonprofit organizations only. In 2009, the CPA Technology Advisor gave them a 5 star rating on their accounting software.

If you have had any good or bad experiences with any of the accounting software packages listed above please leave comments below. In addition, if there is a software program that you feel like fits in this category, please comment below.  Together we can turn this page into a great resource for other nonprofit organizations.

Review of EZChef Software

Nov 112010

This product is brought to you by RRG (The Restaurant Resource Group). These are the same people that provide the excellent QuickBooks Restaurant Accounting Software guide. The idea behind this restaurant software is to save managers time when performing their accounting and managerial tasks. The truth is that most restaurant managers are starting to see the benefits from tracking inventory, costs, and sales very closely. If information about these items is organized, managers can use it to make smarter decisions for their restaurants.

EZChef helps with inventory management. You can enter your inventory into the software and it will help you keep track of everything. This program is based off of Microsoft Excel. Some accountants frown upon the use of spreadsheets because of their lack of controls. However, this program has some serious functionality that would be helpful for restaurant managers. Here’s a quick look at an inventory worksheet.

As a restaurant manager, it can be a nightmare to track the costs of all of the different items on the menu (especially without a good restaurant accounting software package). Some managers don’t do a good job of this and they end up paying for it later. In order to turn a profit with your restaurant you need to accurately monitor the cost of your ingredients. The EZChef software has a pretty good tool for doing this.

There are two ways to keep track of your menu costs with this software. (1) You create recipes and sub recipes. A sub recipe is exactly what it sounds like. It isn’t a complete recipe, but it is a mixture of a few ingredients that are used in many of your different menu items. You then manually enter the price in for the ingredients that make up the sub recipes. Now anytime you enter in a new recipe (using the sub recipes) into EZChef, the software will automatically show you the cost of that recipe or menu item. If the price of an ingredient changes, simply manually update the ingredient prices and the costs of each of your menu items will also be updated.

A Look at the EZ Chef Pricing Spreadsheet

The (2) second method is quite intriguing to say the least. If your restaurant’s ingredients are changing on a daily basis, it can be a huge hassle to keep changing the price of ingredients. Some managers have decided that they simply won’t update the prices because it is too time consuming. These managers are probably promoting menu items don’t have as big of a gross margin as they think. In our opinion, the single best feature of EZChef software is that it can automatically update the prices of your ingredients as often as you want. Once the prices are updated on the ingredients, the software automatically updates the cost of each of your items on the menu. A restaurant manager armed with this information will know which menu items to push. This could lead to drastic gains for some restaurants.

This automatic updater only works with certain food distributors: Sysco, Ben E. Keith, U.S. Foodservice, and Gordon Food Service. The software can interact with these distributors. When they update their prices, all you have to do is click a button and your ingredient prices and menu costs will also be updated. Pretty nifty in our opinion. Note that there are many different types of restaurant software.

The price of this software is $189 for the standard version. The standard version is the one that you have to update manually. The standard version will probably be a good choice for companies whose ingredients don’t change prices that often. The automatic update version costs $249. This might be a good investment for those restaurant managers who want to add another tool to their arsenal.

The EZChef software isn’t a complete restaurant accounting software package. However, it is a great tool for managing inventory and pricing. The automatic update feature may just make it one of the best restaurant management software packages available.

Advantages and Disadvantages (In review)

Advantages

  • Great for managing inventory
  • Great for keeping track of menu costs
  • Automatic update feature provides incredible information

Disadvantages

  • Excel Based (may have control weaknesses)
  • Not necessarily a restaurant accounting software package. In our opinion this tool does not replace the need for accounting software (for reporting and tax purposes). This is a tool that can help you make smarter decisions.

Would I use it in my restaurant? If I already had an accounting software package, then yes. This tool could give you information that would make your restaurant much more profitable. It would be nice to see this software interact smoothly with other popular accounting software packages. They already wrote the book on QuickBooks for restaurants so why not?

Forty-Four Different Types of Accounting Software

Mar 012010

Most people believe that accounting software is not a very broad topic. However, it turns out that there are about as many different accounting packages as there are people in a small country. Below is a list of all the

different types we could identify. We’ll provide a short summary of each here, but in the future we plan to go more in depth into each category. In fact look for a post on each software category in the future.

Business Accounting Software – This is a pretty broad category within the accounting softwares arena. It basically consists of all of the accounting packages that a business might use. Some popular choices include QuickBooks, Sage, Peachtree, etc. Note that a lot of larger businesses will develop special software just for their business.

General Ledger Accounting Software – Just like it sounds, this software is specifically designed to interact with the general ledger. Most software out there has this integrated within the package, but there are still some places where you can buy just general ledger software.

Manufacturing Accounting Software – Turns out that manufacturers want their own type of accounting software. We’ll dive more into this topic at a later time, but manufacturers need something that will not only keep them in compliance with GAAP, but will also keep track of vital manufacturing information that can give them an edge on their competitors.

Inventory Control Software – This in all honesty is some of the coolest accounting software available. The normal software tracks the information provided by bar codes and scanners. The high-end packages are really awesome; the software actually interacts with RFID (Radio-Frequency Identification) tags to keep track of where your inventory is at all times. Very nice, and very expensive.

Property Software – Like all the categories we are discussing, this one has a lot of different functions. The basic function of this type of software is to be able to keep track of a Landlord’s many properties and tenants while still being able to generate reports that satisfy banks and investors.

Restaurant Accounting Software – Another fun area of accounting. There is actually a whole field of accounting software dedicated to restaurants. Who would have thought? More on this coming in the future.

MRP  Software – Stands for material requirements planning software.  This software is used to account for the type, quantity, and quality of material that will be necessary for the manufacturing process.

Small Business Inventory Software – This is just like the inventory software mentioned above except it is specifically designed for smaller businesses. This usually means that the package is not as detailed, and in most cases not as expensive.

Payroll Accounting Software – This software is specifically designed to keep track of the payroll department of a business. It tracks payroll information, generates checks, and generates payroll reports for management.

Insurance Accounting Software – If you’re not part of the insurance industry you may believe that we’re making up this type of accounting software. Although it doesn’t seem like the Insurance industry would need its own accounting software, there are companies that specialize in making accounting software for these companies.

Trust Accounting Software – Trust accounting is a difficult area, burdened with all sorts of laws and policies. Having specific software for this industry helps, but don’t expect it to solve all your problems.

Warehouse Inventory Software – Similar to inventory software, but designed for larger warehouses.

Asset Software – This type of software can be as basic as you want or as high tech. Some people keep track of their assets with excel, while others have some complicated programs that interact with RFID tags to keep track of depreciation, life, location, and value of each asset (pretty cool software).

Audit Management Software – Just like it sounds, this software industry provides a tool for auditors to manage their audits. Most of the larger audit firms (The Big 4) have their own proprietary software, but some of the smaller firms may be interested in some over-the-counter packages.

Retail Inventory Software – Similar to normal inventory software, but for retailers. On a big scale think Wal-Mart’s vendor managed inventory system that basically forces all of their suppliers to keep their inventory stocked. On a smaller scale, think of a Mom-and-Pop shop that needs some inventory tracking software that will alert them when they need to reorder.

Construction Accounting Software – QuickBooks Premier Edition actually has a specific industry section for construction; that shows you how large of an accounting software industry this is.

Online Accounting Software – This type of software, known as software as a service (SAAS) has become very popular in recent years. Basically the idea is that you don’t need to store your information on local computers. Instead the information is stored on secure servers. This can be beneficial because you can access key information from anywhere in the world, even when you’re on vacation.

Personal Accounting Software – Excel is probably the most used personal accounting software. There are some other popular services out there such as QuickBooks. There is also a wealth of free resources available on the Internet.

Accounts Payable Software – Not a lot to add about this type of software. It simply tracks a company’s accounts payable. Most accounting software comes with this included, but you some still sell it as a separate module.
Accounts Receivable Software – Tracks your accounts receivable. This software can help you reduce your days receivables outstanding.

ERP Accounting Software – ERP (Enterprise Resource Planning) software is a growing trend amongst today’s businesses. The idea is that you have one software package to manage all parts of the business. As you can imagine, these are often custom built because each business is different. However there are a few basic packages that will work if you’ll mold them to your business model.

Fund Accounting Software – Fund accounting is most often used by governments, non-profits, and churches. This is a growing area of accounting software with a few well-established providers, but room for others to move in.

Tax Accounting Software – Almost everyone knows about this type of accounting software. Turbo Tax and Tax Act are some of the more popular services out there. More and more this type of software is moving to the Internet. FreeTaxUSA is a popular online tax service, and the federal filing is free.

Cost Accounting Software – There are some over-the-counter packages that deal with managerial accounting. However, there are no rules when it comes to cost accounting so many companies develop their own accounting packages and consider these packages a confidential, competitive advantage.

Linux Accounting Software – Specifically designed accounting software for Linux.

Project Accounting Software – This is usually used for managing large projects. You would be amazed at how difficult it can be to manage a large project without some software.

School Accounting Software – What type of accounting a school does really depends on its affiliation with the government. If it is a public school then it will likely want to use some form of governmental accounting software. If the school is a private, not-for-profit, then it will probably still want to use fund accounting. If the school is a for-profit entity then it will probably just want to use basic accounting software.

Trucking Accounting Software – Yes even truckers need some form of accounting software. Basically this keeps track of where everyone is going.

Farm Accounting Software – Anytime there is something to keep track of you will see some form of accounting software popping up. Farms are no different; if you think about it they have plenty to manage.

Medical Accounting Software – This is a rapidly developing area. In the olden days, doctors were ridiculed for their lack of business prowess; nowadays they have software built especially for their practices. Some software packages in the medical industry are tracking patient information. Connecting this information with doctors around the world is the future of medical accounting.

Loan Accounting Software – This software handles loan billing, loan servicing, and loan amortization processes. It’s a smaller industry, but it exists.

POS Accounting Software – Point of Sale accounting software comes in very handy for those organizations that sell multiple products. Basically you integrate your point of sale system with your accounting software. This means that for each sale, the accounting information is automatically updated.

Hotel Accounting Software – Basically an accounting package designed for hotels. Surprisingly enough this has been around since the 1980’s.

Partnership Accounting Software – Partnerships have different rules and regulations than corporations. It only makes sense that they would have some slightly different accounting packages as well.
Time Accounting Software – We’re not talking about your average, run of the mill planners here. These are packages designed to track what hundreds of employees throughout the day. This comes in very handy when trying to eliminate employee waste.

Invoice Accounting Software – Software that processes invoices and automatically enters it into the accounting system.

Mortgage Accounting Software – Basically some software that mortgage companies use to track all of their customers payment and billing information.

Stock Accounting Software – Basically a glorified excel spreadsheet. This software tracks whatever stock information you ask it to.

Daycare Accounting Software – Who would have thought that daycares needed their own special accounting software? You won’t see QuickBooks having a special category for these guys, but there is some software out there that keeps track of important financial daycare information and interfaces with QuickBooks.

Municipal Accounting Software – Similar to governmental accounting software. Governments don’t account for their money in the same way that businesses do; so they need their own type of software. Government accounting has a lot of tricky rules that we don’t want to get into in this article, but we will talk more on this in the future.

Opensource Accounting Software – This type of software doesn’t entail a specific type of software, but more about how the software is created. Opensource refers to the fact that the code is available to manipulate the software and usually for free. This can be very helpful if your company is looking to develop custom software, but needs a base to begin.

Database Accounting Software – Most accounting softwares act as a type of database; however when people are looking for this type of software, we assume they are looking for something with a little more storage power than your average software. Database accounting software can be queried and manipulated for data mining purposes.

Rental Accounting Software – If your organization is more focused on renting than selling, then you may want to look for accounting software in this category.

Billing Accounting Software – Most accounting packages come with some form of billing function. However some software packages create the bills and automatically update your accounting ledgers.

Budgeting Software – For individuals budgeting software may just be excel or a personal QuickBooks. However, large companies that rely on budgeting need complex budgeting software. The government is probably the largest entity that uses budgeting regularly. Yes we know it is hard to believe, but the government’s budgeting techniques are rigorous and highly sophisticated. They more than anyone need and use budgeting software.

As most people know, the accounting software does not solve all of your accounting problems. It is simply a tool, but you still need to understand accounting in general, as well as any industry-specific accounting or legal issues. For example if you know nothing about trust accounting and you buy trust accounting software, don’t expect that you will automatically be in compliance with all of the industry standards.

Think this list isn’t comprehensive of all the accounting software out there? Please leave us a message below suggesting a category we missed. Think the list doesn’t provide enough information? Look for an individual, in-depth post for each of these categories in the future.

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