Masonry Magazine May 2003 Page. 37
While most software vendors understand their programs and most convey how to use them, many fall short when it comes to understanding the masonry business and its demands. If you have been using a general accounting system, like QuickBooks by Intuit, you may have come to the conclusion that something was missing.
Changing your accounting system is a big deal and you need to thoroughly shake down the proposed system before you buy-kick the tires so to speak-by setting up a job and processing some transactions. The number one mistake is to rely on what the software vendor said the program does. Be sure to shop for your software first and then buy the hardware that will run your system.
Know your costs upfront, including the cost of the software, future software upgrades, installation costs, training, annual support and other fees that may be involved. A reference from a mason contractor currently using the software would also be beneficial.
Access to information is the name of the game, and as such, the accounting software needs to be Internet-enabled or even web-based. Owners and management are on the move and need to be able to access crucial data regarding their company, such as production, sales, etc., from anywhere. As your company grows, you may need to distribute the workload geographically; as society changes, you may also have to cater to those people that may need or want to work remotely. Also, as time passes, your suppliers will eventually want to send those darn invoices to you electronically. Why not? Beats entering them and it would give you more time to chase down those elusive "signed," or should I say "unsigned," delivery tickets.
Look for a fully integrated, database driven, multi-user, multi-company, divisional, windows-based system that has the same look and feel throughout. The database underneath should come with a report writing capability. Software purchased will not have all of the reports that you may be accustomed to but if the data resides in the database in the correct format, it should be very easy for your software vendor to add those custom reports for a small price. Reports should be effectively date-driven so that you can go back to any time period and re-run those old reports that somehow got lost.
Security is an issue. A good system will allow you to customize the login for each user. In other words, if the user shouldn't have access to payroll, then payroll should not display as an option for them to select. What the user sees is what the user has access to. Blocking options from displaying also helps create a simpler looking screen for those users that may have trouble navigating the system.
The various accounting modules should have no closing and update routines that have to be executed before going on to the next accounting period. Each accounting module needs its own accounting period and closing the period should be as simple as flagging the period as being closed so that no more transactions can be posted to that period by the user. It's also nice to be able to flag a job as being closed so that no more transactions can be posted to that job. Closing the GL-General Ledger-period should prevent postings from all accounting modules regardless of their individual status.
The various accounting modules will also require numerous rates to be entered such as employee/employer tax rates, employee wage rates, insurance rates, billing rates, union wage rates, union fringe benefit rates etc. The best way to deal with all of the rate changes that take place throughout the year is to enter them into the system as they come in. All rates should therefore be entered into the system based on an effective date.
Having said all of the above, now let's take a look at the core accounting software modules that you will need to get started.
Accounts Payable (AP)
Since most of us are not receiving invoices electronically, the invoice entry program should be looked at closely. This program should allow for easy entry and distribution of an invoice to Job Cost (JC) and General Ledger. The general ledger distribution should default to entries that have been predefined for the job elsewhere in the system. If being used in conjunction with the Purchasing module (recommended), the invoice entry program needs to check the invoice unit prices against the purchase order unit prices and not just check to see if the purchase order dollar amount has been exceeded. It is far easier to resolve a unit price issue at the beginning of a job rather than a purchase order dollar discrepancy at the end of a job.
Oftentimes, material is bought on an "as needed" basis, so you need to have the ability to enter a purchase order with unit prices only. It is for this reason that it may not be realistic for your accounting system to send committed costs over to the job cost module.
The invoice entry program should also recalculate the sales tax involved since many vendors undercharge and overcharge at times. Underpaying sales tax can result in additional taxes, interest and penalties down the road. The invoice entry program should also allow you to enter the different levels of sales tax such as state tax, local tax and special assessments by job. This allows you to later generate reports for sales tax reimbursement on tax-exempt jobs.
Other points of importance:
* You should be able to disburse funds from multiple bank accounts.
* There should be a method of selecting out only those invoices you wish to pay, discounts being automatically calculated for you.
* As for voiding a check or an invoice, this should be automatically done by the system simply by specifying the check or invoice number.